The crypto market’s decentralized and unregulated nature makes dispute resolution difficult. It has also made the crypto market a fertile breeding ground for criminals looking to capitalize on the loopholes. The U.K takes note of this problem and has launched a dispute resolution mechanism for investors in crypto and other blockchain-related technologies.
Yesterday, the U.K Jurisdiction taskforce released a document titled Digital Dispute Resolution Rules (DDRR) that spells out mechanisms for settling disputes that come up in crypto-related transactions. One of the issues that the task force will focus on is arbitration between investors and other players.
The arbitrators will be able to settle issues and implement their decisions on-chain. The best aspect of this arbitration mechanism is that it allows for the anonymity of the parties involved in the dispute resolution process.
The task force will also take cognizance of the importance of time in dispute resolution. For this reason, it will aim to solve disputes in 30-days or less. This is quite efficient given that traditional dispute resolution takes a lot longer.
However, while it is a welcome move in the crypto space, investors will have to contend with the added layer of bureaucracy. Part of the task force document states that the tribunal will have the authority to either alter or cancel any transactions in dispute.
The task force will also have the power to instruct any of the parties involved to modify or cancel a transaction. While this may seem intrusive, it creates an element of security in an industry that is increasingly prone to sophisticate criminal activities.