Kleros an efficient and effective way to dispute resolution

## 1.0 INTRODUCTION
Due to accelerated pace if globalization and digitization of the world today, it’s certain that there is an increase rate of online transactions between two persons or parties should be overemphasized on the course of each transactional process because dispute will certainly arise. Dispute being a natural part of any interaction are either handle through an amicable conversation or handle dreadfully long and painstaking.
Dispute resolution is a term that refers to number of processes used in resolving dispute and is divided into two namely
• Adjudicative process such as arbitration or litigation whereby a judge, juror or arbitrator determines the verdict
• Consensual processes such as collaborative law, mediation , negotiation and councilation whereby parties attempt to reach agreement.

Today the advent of technology with rising number of small businesses has come up with differs existing dispute resolution technologies which are slow, too expensive and unreliable for a decentralized dispute resolution mechanism in real time whereas modern civilization is demanding for a fast, inexpensive, transparent, reliable and decentralized dispute resolution mechanism that delivers ultimate judgement about the enforceability of smart contracts which is a key institution for the blockchain era.

Today, I present to us kleros as a decentralized applications built on top of ethereum that works as a decentralized third party to arbitrate dispute in every kind of contract from a simple to a complex once. It relies on game theoretic incentives to have jurors rule cases correctly. Kleros aims at delivering ultimate judgement in a fast, inexpensive, reliable and decentralized manner.

2.0 HOW KLEROS WORKS

2.1 ARBITRATED CONTRACT

Here kleros is an opt-in court system whereby contract creators

2.1.1 Make choices for the number of jurors needed

2.1.2 PRIVACY;

Instead situation whereby disclosure of information with jurors contracts creators create their contract, the creator submit it as hash and send it teaches juror through assymetric encryption in that only the juror receives of the contracts and of the options.

2.2 DRAWING JUROR

2.2.1 System token; the pinakoin

When applied as a juror there is financial incentives that will be given to jurors after each verdict which is gotten from the arbitration fee of each dispute resolution. Candidate can self-select himself as a juror using a token pinakoin. This depends on the amount in pinakoin he or she deposits, the higher the token, the greater the chances of being chose as a juror.

2.2.2 JUROR SELECTION

Candidate are selected as a juror through a randomly done selection and he or she can be chosen more than once for a specific dispute.

2.2.3 RANDOM NUMBER GENERATION

This are done through the help of proof of work and proof of stake blockchain such as
Initialization, computing the master random value, Getting result on the blockchain and getting all random value.

2.3.0 VOTES;

When all the evidence has been assesed, a juror vote once, to only one of these options
• Submit hash (votes, salt and address ) and when votes are over, the reveal votes and kleros smart contracts verifies it if it s matches the commitment. Juror don’t reveal their votes trustlessly and they provide justification to their votes.

2.4.0 ARBITRATION FEES;

In order compensate jurors for their work and avoid an attacker from spamming the system, those creating and appealing dispute must pay an arbitration fee.

2.5.0 APPEALS;

If a party is not satisfy with the verdict given to him or her both can appeal with an appealing fee and this number of jurors will be twice often previous jurors plus one extra juror.

2.6.0 INCENTIVE SYSTEM

In kleros juror rules dispute in order to collect arbitration fee and when the dispute is over juror whose vote is not coherent with group will loose tokens which will be given to coherent jurors in proportional to their weights.

2.7.0 ATTACK RESISTANCE

2.7.1 Buying half of tokens;

For the fact that one party can afford all the tokens at current market price does not mean that he or she can buy half of the token.

2.7.2 Bribe resistance;

in kleros, it is expensive for a party to bribe all the jurors because if there is an appeal he or she has to increase the number of tokens in order to bribe added jurors.

2.7.3 Court Arborescence

when registering users start in the general court and follow path to specific sub court in respect to how skillfull they are, each sub court such as policies, etc.

2.8.0 APPLICATION

Kleros can be used in large number of situation since it is a multipurpose system and some of its possible used cases are
• Escow
• Micro tasking
• Insurance
• Oracle
• Curated list
• Social network

3.0 USED CASES

Use case 1 :
Esther hired happiness to sew her a gown for the seamstress happiness quotes $2000 including labour and materials, she also guarantee that she will finish it in 3days, the first $500 was released. At the completion of the work Esther complain that the gown was not qualitative as she expected, what can Happiness do?
Going to small claims court or engaging in lengthy dispute would be expensive therefore she accept it as a loss, had it been she secure their agreement through kleros, there would have been a panel of judges that could've help to settle the dispute amicably, but Happiness has run out-of $1500.
Use case 2:
Samuel is a computer operator that lives in Lagos, he has a dog and was looking for an inexpensive carpenter who will help him repairs the roof of his dog's house, the carpenter quotes him $5000 including labour and materials with a guarantee of delivering the work in 5 days. Since the carpenter does not have much reputation, kleros was used to put into place a smart contracts that safeguard them in case that he couldn't perform his duties.The first day he didn't show up, out of 5days he showed up only 3 days and he shifted days of delivery to 2 weeks.
Samuel start a dispute through kleros and send a copy of their agreement as well as before and after pictures and their contracts states that 3 jurors specializing in renovation and their option is set as follows
• refunding of all money to Samuel
• Split 50/50
• paying the entire money to contractor
In three days the verdict came and four jurors chooses option A and one jurors chooses B