The Governance of Blockchain Dispute Resolution

20 Pages Posted: 6 Mar 2019

See all articles by Darcy W E Allen

Darcy W E Allen

RMIT University

Aaron Lane

RMIT University - Graduate School of Business and Law

Marta Poblet

RMIT University

Date Written: February 15, 2019

Abstract

Blockchain technology acts as infrastructure for self-executing smart contracts. Because contracts are incomplete and some parties are opportunistic, these new contracting possibilities have created challenges of dispute resolution. For instance, will smart contracts be recognised, and any disputes resolved, within the existing courts of jurisdictions? In this paper we first map some institutional governance possibilities for contracting parties (e.g. mediation, private arbitration, courts) to create a Dispute Resolution Possibility Frontier (DRPF). Second, we provide case studies of emerging blockchain-based mechanisms to solve dispute resolution challenges. Blockchain-based smart contracts might not only create dispute resolution problems, but also act as a technology for entrepreneurs to create new mechanisms to solve dispute problems, including those arising from traditional legal contracts. Contracting parties will subjectively interpret their most effective governance mechanism to resolve disputes, and the costs of dispute resolution will change over time through a process of institutional innovation.

Keywords: Blockchain, Dispute Resolution, Online Dispute Resolution, Distributed Ledger Technology, Institutional Cryptoeconomics, Institutional Possibility Frontier, New Comparative Economics, Smart Contracts

JEL Classification: K12, K24, K40, P48

Suggested Citation

Allen, Darcy and Lane, Aaron and Poblet, Marta, The Governance of Blockchain Dispute Resolution (February 15, 2019). Available at SSRN: https://ssrn.com/abstract=3334674 or http://dx.doi.org/10.2139/ssrn.3334674

Darcy Allen (Contact Author)

RMIT University ( email )

440 Elizabeth Street
Melbourne, 3000
Australia

Aaron Lane

RMIT University - Graduate School of Business and Law ( email )

Melbourne
Australia

Marta Poblet

RMIT University ( email )

124 La Trobe Street
Melbourne, 3000
Australia

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