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Crowd-sourced Blockchain Arbitration With Kleros.io

By Adam Temple

Kleros.io offers a dispute resolution platform - blockchain based - that can integrate into your platform. Just like stripe would integrate into a shopping cart. This is really useful if you are dreaming up a blockchain platform that involves people interacting with other people. They like to have disputes. More specifically, it’s a crowd sourced, blockchain based, game-theory incentivised arbitration system. It’s, the Justice Protocol! Weave that into a pickup line and get chicks.

As of writing, they have settled 1200 disputes, paid 380 Eth to jurors, and have 771 active jurors. This isn’t a dream baby, this is live and working!

How can it integrate with your business?

Say for example that your blockchain business idea is to build a decentralized services market place. A competitor to Fivr, Upwork, Freelance.com, but with all the benefits of decentralization.

Luckily you’re smart and know that freelancers are going to have disputes with their clients, so you offer the Kleros arbitration option for their contracts.

One day you have a web dev who’s paid to create a website for a client. But, the client doesn’t like result! This isn’t a problem if they both agreed beforehand to settle their disputes with the Kleros.

The web dev just opens an arbitration case.

This is where it gets interesting.

How Kleros works

Kleros starts by randomly selecting from a pool of jurors that specialize in tech disputes. Jurors distributed all over the world. You can sign up to be a juror! Then Each side enters in the evidence for there case: - webdev: this looks really good - client: this looks so bad

But you might be asking yourself, how do we know these jurors will make the right decision? Wouldn’t they just vote as quickly as possible and run off with the arbitration fees? Also, some humans make it their life mission to troll the rest of us. Wouldn’t they troll here?

Not a chance! You can’t thwart THE JUSTICE PROTOCOL! Who watches the watchmen? Game theory.

If a juror does their research diligently and votes the clearest outcome, i.e. vote with the with the majority, they get paid. It’s important to understand that each juror has crypto staked, and if they vote against the majority, they are fined from their stake. I mean, actually lose money if you don’t vote with the majority.

In this case, the jurors vote against the developer. The money in escrow goes back to the client. Our sad developer turns his life around and becomes a smart contract developer, making bank from then on.

Proof of humanity (POH) example

The proof of humanity platform, https://democracy.earth is already using Kleros to resolve disputes.

Proof of humanity is a big challenge for blockchain. Actually it’s a big problem for the world. Can you imagine if only real humans could vote in an election? To prove your humanity on Democracy.earth you must record yourself on video, just like you see here. If anyone thinks it’s a duplicate or a fake, they activate dispute resolution through Kleros.

Arbitration is useful for a huge array of businesses. If you watched my video on Etherisc, you might be inspired to make your own decentralized insurance company, like AcreAfrica. A customer thinks they should get but the soil moisture oracle says no? Kleros! The company accidentally pays claims because of a bug and wants the money back: Kleros!

It can work for proof of humanity, for insurance companies, for market places. Maybe it could work for your blockchain business? And the world needs your decentralized business.

Things to be aware of

It’s not based on law. You could you bring someone to court because they didn’t give you their half of the bank robbery.

I could see that evolving. Maybe start with a natural law framework - if you are harming others intentionally, you can’t bring your case in. I know, this isn’t simple stuff.

Also, It’s not acceptable in arbitration clauses legally. Give it time, maybe the world will get there.

In conclusion, this is great for simple disputes, so maybe it fits into your product. Keep an eye on it as I bet they will evolve to handle larger cases as time goes buy. Maybe the highest courts in the world will be fully decentralized by the year 3000.