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RE: Tokenika's take on sustainable EOS arbitration

in #eos6 years ago

Thus appointment of arbitrators needs to be a part of smart contract that is voted upon, as only then a given arbitrator has any mandate to operate.

I think this could be very problematic. If arbitrators are voted, then whales have huge powers in the system because they can make sure there will be arbitrators who they prefer.

No one should have more power than others to influence who are taking the case which they are part of. Who would trust a system where rich people can get judges for themselves?

Let’s imagine the intricacies of more complex cases. Suppose funds gets stolen and transferred further, taking part in legitimate transactions. Scenarios are numerous, and each one of them could turn the arbitration process into a legal spaghetti.

This argument has been made by many who are skeptical about the system. But they seem to think it will be blind and automatic, instead of intelligent people considering the case from all angles. That's why we have humans involved in the system, so we can get a reasonable outcome.

Also note that freezing of accounts (executed by BP's) until resolution is found could be used as an attack vector, not to mention that any such intervention puts finality of EOS transactions in question.

My guess is that account freezing will be quite rare. Scammers learn pretty fast that this is not a good place for them, and on the other hand, arbitrators require strong evidence for freezing. Of course they know there will be people who are trying to abuse the system.

One way to mitigate this is to require bonds from users who open a case. Bond should be so big that it can be used to pay for arbitrator's work and compensate other party if there has been false claim. It's highly unlikely that attackers want to use huge sums of money for this .

Another thing worth mentioning is the volume of arbitrated transactions at hand — a cut-off point should exist, below which no case can be filed. This addresses a vector of attack on the network, where arbitration cases are purposefully too numerous to be handled by anyone. Think arbitration DDOS.

Arbitration costs money. If there are a lot of cases, there is a lot of money to be made which will attract new arbitrators to do the work. DDOSing is also highly unlikely if arbitrators ask for setting a bond before they take the case.

As experienced crypto-libertarians

I count myself as crypto-libertarian, too, and that's why I like this system so much. This is the first blockchain that actually defines property rights and tries to enforce them. Creating a new jurisdiction that's not depending on governments is a huge step forward.

It must be remembered that ECAF won't be the only arbitration forum. It's just the first one. There will be free markets for all kinds of arbitrators and mediators which users can choose. And on the other hand, as Dan has emphasized, the priority is to make the system so safe and easy-to-use that people won't be needing arbitration. Arbitration is only for cases when everything else has failed, which should get rarer over time when the system evolves.

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I think this could be very problematic. If arbitrators are voted, then whales have huge powers in the system because they can make sure there will be arbitrators who they prefer.
No one should have more power than others to influence who are taking the case which they are part of. Who would trust a system where rich people can get judges for themselves?

Actually what you're saying only proves the opposite point. As Dan Larimer has said, the role of arbitrators like ECAF is just to generate an opinion, not a final verdict, so that the ultimate judgment rests with BPs. And look what we have right now: Bitfinex, due to its impact on the top BPs, is the most powerful judge. Try to win a case against such a player.

That's why it's in the interest of all of us to have the power of the most influential players clearly limited by the Constitution. What we have right now is the opposite of that. We've granted enormous power to the richest. You might say they'll behave responsibly, as they value their reputation. But how is it different from PayPal?

The Constitution should be mostly about limiting the power of the most powerful. As it is now, it's mainly about everybody being subject to the unrestricted judgement of the most powerful.

This argument has been made by many who are skeptical about the system. But they seem to think it will be blind and automatic, instead of intelligent people considering the case from all angles. That's why we have humans involved in the system, so we can get a reasonable outcome.

Judgments in complex matters are... complex. What makes you think we can recreate on EOS a better justice system than the one we have in the real world?

I count myself as crypto-libertarian, too, and that's why I like this system so much. This is the first blockchain that actually defines property rights and tries to enforce them. Creating a new jurisdiction that's not depending on governments is a huge step forward.

Again, why do you think EOS obligatory arbitration has a chance to be a better solution than legacy systems?Just because we have "intelligent people considering the case from all angles"?

It must be remembered that ECAF won't be the only arbitration forum. It's just the first one. There will be free markets for all kinds of arbitrators and mediators which users can choose.

You're confusing arbitration to solve an actual dispute where both sides of the argument choose an arbitrator prior to entering a contract (in this case the competition between arbitrators is indeed a good solution) with "arbitration" to catch those who are accused of violating property rights (in other words, thieves and scammers). In the latter case, it doesn't really matter if ECAF is the only arbitration forum or not, as in this case ECAF acts as police and it's the victim who decides whom to employ, whereas the defendant has no choice in this matter. Imagine being accused of theft by someone connected to the top 21. You stand no chance of having a proper trial.

What makes you think we can recreate on EOS a better justice system than the one we have in the real world?

What makes you think we would be better off without a justice system? It's not like everything is always bad with existing justice systems and there is no upside to them. All systems are imperfect, especially where humans are involved, but some problems cannot be solved without human intervention. It doesn't mean we shouldn't try. I mean the argument that we should not do anything legacy systems do, just because we might fail to improve them, is wrong in my opinion.

All I'm not advocating writing off the justice & arbitration system completely. What I'd like to see is clear distinction between those two categories (as they serve different use cases) and applying the justice system only in very precisely defined cases. Rescuing people from theft is very tricky, especially when the ultimate judges (i.e. the top BPs) have disproportionate power and normal shareholders stand no chance against them.

Thus the primary thing the Constitution should do is define clear limits to the power of BPs instead of stating that all shareholders are effectively subject to justice served by them.

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