Towards a Privacy-Preserving Dispute Resolution Protocol on Ethereum

TL;DR

This paper proposes a privacy-preserving dispute resolution protocol on Ethereum that leverages zero-knowledge proofs and social incentives, enabling trustworthy governance without native tokens.

Contribution

It introduces a novel dispute resolution model combining zero-knowledge protocols with social governance via soulbound tokens, diverging from traditional token-based systems.

Findings

Ensures dispute resolution privacy through zero-knowledge protocols.

Uses soulbound tokens for social trust and governance.

Does not rely on native platform tokens for incentives.

Abstract

We present a new dispute resolution protocol that can be built on the Ethereum blockchain. Unlike existing applications like Kleros, privacy is ensured by design through the use of the zero-knowledge protocols Semaphore and MACI (Minimal Anti-Collusion Infrastructure), which provide, among other things, resistance to Sybil-like attacks and corruption. Differently from Kleros, dispute resolution is guaranteed despite the users having the final say. Moreover, the proposed model does not use a native token on the platform, but aims to reward stakeholders through a social incentive mechanism based on soulbound tokens, introduced by Weyl, Ohlhaver, and Buterin in 2022. Users with these tokens will be considered trustworthy and will have the ability to govern the platform. As far as we know, this is one of the first blockchain projects that seeks to introduce social governance rather than one based on economic incentives.