Hello, It seems to me that smart contracts is a bit difficult to understand. It confuses the basic interaction described. I know smart contract binds a relationship with cryptographic code means they carry out the tasks set by their makers.
Would anyone want to share how the Ethereum smart contracts works actually ?
You can try to learn more about how smartcontract works through ethereum wiki and that has explained a lot about that
https://github.com/ethereum/wiki/wiki/White-Paperas far as I understand the smartcontract is the evolution of the bitcoin protocol with some improvement that makes the chain will able to support dapps development.