We need a Bitcoin trust sidechain for OpenBazaar and BitSquare

[Elwar]

From reading up on OpenBazaar and BitSquare they are both using arbitrators and are trying to come up with their own way of rating users (akin to an e-bay rating for a transaction).

From the options I saw that OpenBazaar is taking they do not look very promising with the frontrunner being burning bitcoins to rate someone. BitSquare allows for a third party rating system which would be good if they could tie it into OpenBazaar.

I think the solution would be to have mediators that are paid to resolve conflicts in ratings, similar to arbitrators resolving a payment dispute.

You could do a multi-sig sort of transaction for rating. If all goes well, person A rates his transaction with person B, person B accepts and the rating is fulfilled.

If there is disagreement, the mediator is person C and can side with person A or person B.

By using a sidechain, the rating can be stored in a side blockchain designed specifically for rating people while still having the value of Bitcoin backing it.

And there should be more than just ratings of a person of 1 to 10 or 1 to 5 or whichever. Someone might be great at buying items but when they go to sell they are scammers. Or an arbitrator might be good at buying or selling but make piss poor decisions when arbitrating.

This is just an observation as someone who has not worked on either of these projects so it may have already come up.

What are your thoughts on this?

[newIndia]

Any decentralized system which is not purely trustless will be inferior than centralized trust systems. The reason of bitcoin's success is not only that it is decentralized, but also it is trustless. All these efforts like Bitsquare.io or OpenBazaar has failed to be purely trustless and relying on an arbitrator. IMHO, as soon as you bring in human interference you are no more trustless and just a flavor of centralized trusted systems.

[Elwar]

Any decentralized system which is not purely trustless will be inferior than centralized trust systems. The reason of bitcoin's success is not only that it is decentralized, but also it is trustless. All these efforts like Bitsquare.io or OpenBazaar has failed to be purely trustless and relying on an arbitrator. IMHO, as soon as you bring in human interference you are no more trustless and just a flavor of centralized trusted systems.

But the arbitrator is decentralized. Anyone can become an arbitrator, all they are doing is confirming a transaction just like a mining computer would confirm a transaction.

[SpanishSoldier]

Any decentralized system which is not purely trustless will be inferior than centralized trust systems. The reason of bitcoin's success is not only that it is decentralized, but also it is trustless. All these efforts like Bitsquare.io or OpenBazaar has failed to be purely trustless and relying on an arbitrator. IMHO, as soon as you bring in human interference you are no more trustless and just a flavor of centralized trusted systems.

But the arbitrator is decentralized. Anyone can become an arbitrator, all they are doing is confirming a transaction just like a mining computer would confirm a transaction.

Not sure about OpenBazaar, but arbitrators maintain a hierarchical structure in Bitsquare.io (ref: https://bitsquare.io/arbitration_system.pdf), which is very much like BitcoinTalk's Trust system. They have a supreme court type of thing, which can be compared with our DefaultTrust. Now, imagine some CanaryInTheMine will be sitting in that supreme court. How will he try to f**k around the arbitration system for his own profit ? This is impossible in bitcoin network, because there is no human judgement. Same is impossible in decentralized exchange/marketplace because FIAT transfer is always requiring manual approval (unless we can have a fixed value ALt).

[Elwar]

Any decentralized system which is not purely trustless will be inferior than centralized trust systems. The reason of bitcoin's success is not only that it is decentralized, but also it is trustless. All these efforts like Bitsquare.io or OpenBazaar has failed to be purely trustless and relying on an arbitrator. IMHO, as soon as you bring in human interference you are no more trustless and just a flavor of centralized trusted systems.

But the arbitrator is decentralized. Anyone can become an arbitrator, all they are doing is confirming a transaction just like a mining computer would confirm a transaction.

Not sure about OpenBazaar, but arbitrators maintain a hierarchical structure in Bitsquare.io (ref: https://bitsquare.io/arbitration_system.pdf), which is very much like BitcoinTalk's Trust system. They have a supreme court type of thing, which can be compared with our DefaultTrust. Now, imagine some CanaryInTheMine will be sitting in that supreme court. How will he try to f**k around the arbitration system for his own profit ? This is impossible in bitcoin network, because there is no human judgement. Same is impossible in decentralized exchange/marketplace because FIAT transfer is always requiring manual approval (unless we can have a fixed value ALt).

I only read the OpenBazaar paper on it. It looked quite decentralized. I need to read more on the BitSquare setup.

[SpanishSoldier]

Any decentralized system which is not purely trustless will be inferior than centralized trust systems. The reason of bitcoin's success is not only that it is decentralized, but also it is trustless. All these efforts like Bitsquare.io or OpenBazaar has failed to be purely trustless and relying on an arbitrator. IMHO, as soon as you bring in human interference you are no more trustless and just a flavor of centralized trusted systems.

But the arbitrator is decentralized. Anyone can become an arbitrator, all they are doing is confirming a transaction just like a mining computer would confirm a transaction.

Not sure about OpenBazaar, but arbitrators maintain a hierarchical structure in Bitsquare.io (ref: https://bitsquare.io/arbitration_system.pdf), which is very much like BitcoinTalk's Trust system. They have a supreme court type of thing, which can be compared with our DefaultTrust. Now, imagine some CanaryInTheMine will be sitting in that supreme court. How will he try to f**k around the arbitration system for his own profit ? This is impossible in bitcoin network, because there is no human judgement. Same is impossible in decentralized exchange/marketplace because FIAT transfer is always requiring manual approval (unless we can have a fixed value ALt).

I only read the OpenBazaar paper on it. It looked quite decentralized. I need to read more on the BitSquare setup.

Can u plz point me to the OpenBazaar's whitepaper ?

[abcdave]

Any decentralized system which is not purely trustless will be inferior than centralized trust systems. The reason of bitcoin's success is not only that it is decentralized, but also it is trustless. All these efforts like Bitsquare.io or OpenBazaar has failed to be purely trustless and relying on an arbitrator. IMHO, as soon as you bring in human interference you are no more trustless and just a flavor of centralized trusted systems.

But the arbitrator is decentralized. Anyone can become an arbitrator, all they are doing is confirming a transaction just like a mining computer would confirm a transaction.

What happens when they get it wrong from time to time or even become scammers themselves? Any issue with trust and a feedback system is a tricky business. Just look at ebay. It works well when you are scammed but it can also easily be abused by fraudulent buyers. It's going to be interesting to see how these decentralized markets handle this stuff as it could be make or break.

[Elwar]

Any decentralized system which is not purely trustless will be inferior than centralized trust systems. The reason of bitcoin's success is not only that it is decentralized, but also it is trustless. All these efforts like Bitsquare.io or OpenBazaar has failed to be purely trustless and relying on an arbitrator. IMHO, as soon as you bring in human interference you are no more trustless and just a flavor of centralized trusted systems.

But the arbitrator is decentralized. Anyone can become an arbitrator, all they are doing is confirming a transaction just like a mining computer would confirm a transaction.

Not sure about OpenBazaar, but arbitrators maintain a hierarchical structure in Bitsquare.io (ref: https://bitsquare.io/arbitration_system.pdf), which is very much like BitcoinTalk's Trust system. They have a supreme court type of thing, which can be compared with our DefaultTrust. Now, imagine some CanaryInTheMine will be sitting in that supreme court. How will he try to f**k around the arbitration system for his own profit ? This is impossible in bitcoin network, because there is no human judgement. Same is impossible in decentralized exchange/marketplace because FIAT transfer is always requiring manual approval (unless we can have a fixed value ALt).

I only read the OpenBazaar paper on it. It looked quite decentralized. I need to read more on the BitSquare setup.

Can u plz point me to the OpenBazaar's whitepaper ?

The docs I found are on their GitHub page. Here is one about the web of trust: https://github.com/OpenBazaar/OpenBazaar/blob/develop/docs/02%20Web%20of%20Trust.md

As for BitSquare's centralization. I do see that they have 10 arbitrators that are queried upon a problem with an arbitrator. But they are not a static 10, they are the 10 highest rated arbitrators and that could change daily. If they abuse their power, their rating goes down and they are no longer the top 10.

That is why the rating solution should be solid and decentralized. So that there cannot be abuses of the ratings in order to try to get to the top 10.

And even if you reach that top 10, people choose from among those 10 to resolve disputes with their arbitrator. If the arbitrator is found to be in the wrong then they lose some of their initial deposited funds.

[SpanishSoldier]

Any decentralized system which is not purely trustless will be inferior than centralized trust systems. The reason of bitcoin's success is not only that it is decentralized, but also it is trustless. All these efforts like Bitsquare.io or OpenBazaar has failed to be purely trustless and relying on an arbitrator. IMHO, as soon as you bring in human interference you are no more trustless and just a flavor of centralized trusted systems.

But the arbitrator is decentralized. Anyone can become an arbitrator, all they are doing is confirming a transaction just like a mining computer would confirm a transaction.

Not sure about OpenBazaar, but arbitrators maintain a hierarchical structure in Bitsquare.io (ref: https://bitsquare.io/arbitration_system.pdf), which is very much like BitcoinTalk's Trust system. They have a supreme court type of thing, which can be compared with our DefaultTrust. Now, imagine some CanaryInTheMine will be sitting in that supreme court. How will he try to f**k around the arbitration system for his own profit ? This is impossible in bitcoin network, because there is no human judgement. Same is impossible in decentralized exchange/marketplace because FIAT transfer is always requiring manual approval (unless we can have a fixed value ALt).

I only read the OpenBazaar paper on it. It looked quite decentralized. I need to read more on the BitSquare setup.

Can u plz point me to the OpenBazaar's whitepaper ?

The docs I found are on their GitHub page. Here is one about the web of trust: https://github.com/OpenBazaar/OpenBazaar/blob/develop/docs/02%20Web%20of%20Trust.md

As for BitSquare's centralization. I do see that they have 10 arbitrators that are queried upon a problem with an arbitrator. But they are not a static 10, they are the 10 highest rated arbitrators and that could change daily. If they abuse their power, their rating goes down and they are no longer the top 10.

That is why the rating solution should be solid and decentralized. So that there cannot be abuses of the ratings in order to try to get to the top 10.

And even if you reach that top 10, people choose from among those 10 to resolve disputes with their arbitrator. If the arbitrator is found to be in the wrong then they lose some of their initial deposited funds.

The main drawback of this rating is people will create sockpuppet and false trades to stay in the top 10. See how CanaryInTheMine is abusing DefaultTrust. He is adding those to his trust list, who is leaving him +ve feedback and thereby having a huge green signal. Same will happen for these decentralized arbitration systems. It can not be trustless, if it is manual.

[Q7]

I think the solution would be to have mediators that are paid to resolve conflicts in ratings, similar to arbitrators resolving a payment dispute.

Sounds interesting but I just wonder how are we going to moderate that. There are bound to be loopholes and even by burning bitcoins, there's a gap that people can manipulate in order to fake the ranking. As for the mediators, a person can also be bribed. I don't know. Overall, it's definitely workable and indeed looks to be a very promising and exciting solution to encourage trading. and that is provided if all these potential loopholes have been addressed and analyzed at every angle to prevent manipulation.

[Elwar]

The main drawback of this rating is people will create sockpuppet and false trades to stay in the top 10. See how CanaryInTheMine is abusing DefaultTrust. He is adding those to his trust list, who is leaving him +ve feedback and thereby having a huge green signal. Same will happen for these decentralized arbitration systems. It can not be trustless, if it is manual.

Yes, as the OpenBazaar paper says, this is the main thing that needs to be addressed:
"In decentralized systems, Sybil attacks [Douceur] make this situation particularly more challenging and without an easy way to resolve."

They go into a lot of different options to address it including proof of burn.

[countryfree]

I was interested in Openbazar when I first heard about it, but I'm horrified by all rating systems. That's one of the reason I don't use Airbnb. I don't want to be rated, and it's all BS anyway. I used to read Tripadvisor before I learned you could buy the work of Indians who will write as many fake reviews as you want. You think you're safe but you're not.

[HarryPotHead]

Counterparty is not far from smartcontracts i wonder if that will work,

BitHalo is another already out has been since july i believe