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In Solidity, the `self-destruct` function allows for the deletion of a contract from the blockchain. When invoked, it not only removes the contract but can also transfer Ether to a specified address, even if that address is a contract without a fallback function. In the demonstration, a contract named "Tail" is created, with an external function called "autokill" that executes `self-destruct`. This function takes a single input, an address, to direct the Ether stored in the contract. For instance, if the contract holds one Ether and the function is called with `message.sender`, the contract will be deleted from the blockchain, and the Ether will be sent to `message.sender`.
