Kleros - Is Always Fair -

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The world is currently presenting a big change, since the cryptocurrencies and blockchain have revolutionized it, so there are more new ideas added to make it easier for users to stay in relation to it, so this year was launched a decentralized application built on Ethereum, in order to facilitate, protect and close agreements in the most fair way, so I will talk about this wonderful application called Kleros.

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Kleros is a decentralized application based on a famous platform known as Ethereum, which will function as an external to arbitrate cases in which a state court can not intervene, so kleros will facilitate and get the most fair, safe and economical way to a final result to all users who present disputes in their contracts,

The arbitration process will be processed automatically, who will be responsible for having an agent, which in this case would be the jury that will obtain all the evidence to produce the final result (decision) using crowdsourcing and blockchain technologies.

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Users create a smart contract and choose Kleros as its adjudication protocol.
Dispute : The relevant information is securely sent to Kleros.
Selection: A tribunal is drawn from the crowd. Jurors evaluate evidence and cast their vote.
Enforcement : The decision is enforced by the smart contract.

Once the user makes an intelligent contract with kleros, the creators of the contract must select how many members of the jury and which court will decide their contract in case of dispute. They must choose a court that has knowledge and skills on their specific subject. For example (see the image below).

Source Whitepaper page 3

Example of dispute summing up how Kleros work.

Source Whitepaper page 14

Among the options to be taken by the jury, are.

Reimburs to the staff that is in disagreement with the project.
Give extra time to finish or make modifications to the project.
Make the payment to the user who made the project.

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Many will wonder, what is the incentive? Here I have your answer, simply this is based on a currency known as Pinakion. Candidates to be taken as jurors will increase their probability of being chosen with the largest amount of chips (pinakion) that are deposited. So that user who does not make a deposit of pinakion has no possibility of being elected, to be a judge of a dispute. This with the purpose that these disputes are evaluated by active users.

Pinakion play two key functions in Kleros design

First, they protect the system against the sybil attack

Second, pinakion provides jurors the incentive to vote honestly by making incoherent jurors pay
part of their deposit to coherent ones.

Source Whitepaper page 4

Kleros is a system that can be used in multiple situations that will be named below:

Escrow: To pay for an out-of-chain service, the payment can be placed in an smart contract, which after receiving the project, the funds can be transferred to the person who made it or in the event of a dispute, the refund can be made to the buyer or to the seller.
Micro tasking: Decentralized platforms could pay for microtasks (in the manner of the Amazon Mechanical Turk(1)). Taskers would put a security deposit and submit answers to microtasks. The tasks would be replicated. If a task gets different answers, taskers could admit their mistake, this would transfer a part of security deposit to the taskers who performed the task correctly Source Whitepaper page 12-13
Insurance : The insuree will pay a fee to the insurer to get a compensation in case a particular event would happen
Oracle : A party (which can be a smart contract) asks a question. Everyone can give a deposit and submit an answer. If everyone gives the same answer, it is returned by the Oracle. If there are multiple answers, a dispute resolution procedure ensues. Source Whitepaper page 12
Social networks: Parties can report violations of the network policies and put a security deposit. If the violation is contested, a dispute resolution process ensues. If the violation is not contested or confirmed by Kleros various effects can be implemented: the content can be removed, the content poster can lose a sign-up deposit and the reach of his other posts can be lowered. Source Whitepaper page 13

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In conclusion Kleros is a decentralized system that will facilitate a response to all disputes that occur between users, through a court system and agents (jury) that will collect all the necessary evidence to determine if the projects have all the regulations to receive funds or compensation without monetary loss. The work will be done by a team that will have the ability to study the situation and make an appropriate decision.