Why is understanding the covenant of grace essential for Christians?

The covenant of grace is central to Reformed theology as it acknowledges that God, through Christ, has fulfilled the terms of the law on our behalf. In the article, it's described as a new covenant that addresses our sinful nature and promises transformation through faith. By grasping the depth of this covenant, believers understand their need for grace, leading to gratitude and a lifestyle that reflects our relationship with God. The significance of recognizing that Christ is our substitute who completed the law's demands cannot be overstated; it provides believers with assurance of salvation and empowers them to live in a manner pleasing to God as they are sealed by the Holy Spirit.