Let's go back to the roots and think of Satoshi designing the decentralized financial system. By doing so, we might appreciate the way he fixed the problem of the participants' protection against double-spending: through the creation of a peer-to-peer network of independent nodes, capable of building a consensus. Some members of the community share a view that Satoshi Nakamoto was designing the principle of decentralized arbitration.

So, what would it look like if we could address a request in a digital jurisdiction? Vitalik Buterin, co-creator of Ethereum ecosystem, suggested that it could be an instrument, allowing a user to ask a question and in turn promting a decentralized mechanism to determine the answer.

In corporate landscape, all interactions always require a contract. In the case that a dispute emerges as a result of the deal, the matter of a dispute won't be the transaction itself, but a contract. At this stage, in non-digital world, parties involved in the deal would take legal action in the court.

In case companies are considering smart-contracts as a way to make a deal (which means, smart-contracts enroll the business agreements into programmable code), it's expected that parties encounter potential disputes as well. Regardless of the type of contract, disputes may appear after any agreement, a blockchain deal is no exception. That is the reason why trust is a foundational element of any business.

Having said that, we all realise that the traditional arbitration system doesn't fit into the digital cryptocurrency world. At this point, it's necessary to explore viable blockchain alternatives to substitute the current procedural, organizational, and technological infrastructure required to create trust. While maintaining trust throughout a digital economy is a big challenge, the payoff could be profound.

In order to make this decentralized ecosystem reliable, smart-contracts of differing natures (proprietary, labor, or other) have to be fixed in an immutable, un-fakeable and independent blockchain.

When one of the parties is dissatisfied with the outcome of the deal, it may order a decentralized arbitration hearing in the frame of digital jurisdiction. In other words, decentralized arbitration is an essential instrument for companies and organizations to interact safely with smart contracts and crypto-currency payments. Moreover, the ability of blockchain technologies to replace middlemen with mathematics is precisely why this technology is a perfect ground for new formation of jurisdiction.

We can now proceed to flesh out an entirely new conception of the arbitration system – functioning in a smart, digital and decentralized ecosystem:

• In order to build a system of decentralized arbitration, first of all, we should exclude the element of prejudice and possibly corrupt components. Due to these reasons, judges have to remain unknown for both plaintiff and defendant.
• Anonymous digital rooms will serve as an operational space for the procedure where both defendant and plaintiff will bring charges, offer evidence and statements of the witnesses.
• Following the principles of decentralized society, arbitrators will be suggested by mathematical algorithms, which analyze the digital reputation of the judges, sphere of their competence and practical involvement in specific jurisdiction and economic sector. The compensation for the arbitrators' contribution will be paid by the losing party. The amount of the compensation has to be distinguished in advance. Though, in the early stages, arbitrators may be incentivized to offer their service for free in order to develop a reputation.
• At the end of a trial, the defeated party receives the commitment requirement. The failure to meet the requirements of the court would be equivalent to losing business reputation and relations, linked to the digital ID of the participant. As a motivational reason to comply with the decision of the arbitration court, an open database of all preceding arbitration processes will be established so that all relevant information is available to other users.
• In the frame of this digital jurisdiction, smart-contracts will be available only for identified users. In the digital world, like in real life, a tarnished reputation will close many doors and constrain the future development for the unconscious actors.
• According to the New York Arbitration Convention, parties of the arbitration process may choose a preferred jurisdiction as a legal base for the trial. Until the day comes where most major states form trans-governmental regulation for the appliance of smart-contracts, a jurisdiction chosen by the parties to the agreement will serve as regulatory base for the resolution of decentralized arbitration disputes.

Conception of decentralized arbitration system can be realized in the frame of the blockchain-ecosystem Jincor, which is attempting to provide the digital jurisdiction for B2B interactions. The Jincor platform is currently in a pre-ICO stage, and welcomes any interested users to the website. While others are weighing the advantages of smart-contracts, one can start to build the decentralized ecosystem for a safe and easy B2B future together!