- Vitalik Buterin tweeted regarding the paper from Hitoshi Matsushima and Shunya Noda on blockchain-based smart contracts for arbitration.
- A mechanism to settle legal disputes without the involvement of a legal procedure utilizing the blockchain technology has been brought up by Professor Hitoshi Matsushima.
Vitalik Buterin, co-founder of Ethereum on April 10, 2020, tweeted regarding the paper from Hitoshi Matsushima and Shunya Noda on blockchain-based smart contracts for arbitration, also with the provision of the link of the same.
Paper from Hitoshi Matsushima and Shunya Noda on blockchain-based smart contract for arbitration (or what I’ve earlier called “decentralized courts”):https://t.co/sDavIEPsFf
— vitalik.eth (@VitalikButerin) April 10, 2020
Blockchain technology owns the potential to store the records of information in a way that there exists no chance for manipulation. Blockchain is designed to be decentralized: no involvement of administration or central government. Having numerous applications of its own in various fields, there has been a recognition of more comprehensive services it offers besides the popular Bitcoin cryptocurrency.
A mechanism to settle legal disputes without the involvement of a legal procedure utilizing the blockchain technology has been brought up by Professors Hitoshi Matsushima from the Department of Economics at the University of Tokyo and Shunya Noda from the Vancouver School of Economics at the University of British Columbia, in Canada.
It, for instance, is the expansion of the existing ideas for smart contracts with the exclusion of the central administration. However, in the field of legal enforcement, there exists no application up until now.
INSIGHTS INTO THE PAPER ABSTRACT
The paper outlines that the design of self-enforcing mechanisms that have no reliance on either a trusted third party or a long-term relationship is being studied, a smart contract written on the blockchain is being used instead. The design of the digital court, a smart contract, is such that it identifies and punishes agents who renege on the agreement.
The paper also proclaims that any agreement implementable with the legal enforcement could also be implemented with the enforcement by the digital court. To highlight the design of the digital court, it owns a unique equilibrium as long as there exists a positive fraction of the behavioral agents. The correct judgment in the equilibrium is given based on the count of the honest agents more than dishonest agents.
It reports that the self-enforcing mechanisms proposed in it could be used practically even now as the platform for smart contracts is already ready this year.
Also, drawing attention to the benefits, the paper details out that since the digital court could be used for the implementation of the general agreements, there is no provision for the leakage of the detailed information about the arrangement even after its deployment being on a public blockchain (e.g., Ethereum) as a smart contract.