> ## Documentation Index
> Fetch the complete documentation index at: https://docs.justly.one/llms.txt
> Use this file to discover all available pages before exploring further.

# Marketplaces (E-commerce, P2P, Services)

> The real problem (not a theoretical one)

<Note>
  Status: Live (Public Adversarial Dispute)
</Note>

The real problem (not a theoretical one)

In any marketplace where buyers and sellers **don’t know each other**, disputes are **not an edge case** — they are a normal part of the system.

Common, real-world examples:

* A buyer says *“the product never arrived”*
* The seller replies *“it was delivered, here’s the tracking”*
* A customer pays for a service (design, repair, delivery) and claims it **doesn’t meet the agreement**
* The provider claims they **did deliver as agreed** and the buyer is requesting an unfair refund
* A product arrives but:
  * it doesn’t match the description,
  * it’s damaged,
  * or it arrives later than promised

These situations happen **every day**, even on large marketplaces.

***

#### How disputes are handled today (and why this doesn’t scale)

Most marketplaces resolve disputes in roughly the same way:

1. Funds are held by the platform.
2. The user opens a support ticket.
3. A support agent:
   * reads messages,
   * reviews screenshots,
   * interprets internal rules.
4. The platform makes a decision and releases the funds.

This approach creates several structural problems:

* ❌ **The platform acts as judge and party**\
  It decides over funds it doesn’t own, while its own reputation is at stake.
* ❌ **High operational costs**\
  Every dispute requires human time and review.
* ❌ **Opaque decisions**\
  Users don’t clearly understand why a decision was made.
* ❌ **Poor scalability**\
  More users → more disputes → more support → higher costs.

As a result, many marketplaces:

* limit refunds,
* systematically favor one side,
* or simply ban users.

This **breaks trust**.

***

#### The key insight: escrow without arbitration doesn’t work

Many marketplaces rely on an **escrow model**:

* the buyer pays,
* funds are locked,
* funds are released if everything goes well.

But when a conflict arises, a critical question appears:

> Who decides who is right?

Without a clear answer:

* funds remain stuck,
* decisions become arbitrary,
* escrow loses its purpose.

👉 **Arbitration is what makes escrow work.**

This is exactly the insight Kleros addressed — and what Justly applies in a more modern, fast, and UX-friendly way.

***

#### How Justly solves this for marketplaces

Justly integrates as an **external dispute resolution layer**.

A simple flow:

1. The buyer pays → funds are locked in escrow.
2. The transaction proceeds normally.
3. If a conflict arises:
   * either party can open a dispute via Justly.
4. Evidence is submitted:
   * product description,
   * messages,
   * receipts,
   * deliverables.
5. A group of **independent jurors** evaluates the case.
6. Jurors vote based on clear rules.
7. The final ruling:
   * releases funds to the buyer **or**
   * releases funds to the seller.

All of this happens:

* without the platform making the decision,
* without internal human support,
* with transparent, verifiable rules.

***

#### A concrete (very realistic) example

**Design services marketplace**

* Price: 150 USDC
* The client claims: *“the design doesn’t meet the agreed scope”*
* The designer claims: *“I delivered exactly what was requested”*

With Justly:

* Both parties submit:
  * the original brief,
  * the delivered design,
  * the conversation history.
* Jurors evaluate:
  * Was the brief respected?
  * Is the delivered quality reasonable?
* A vote is taken.
* Funds are released automatically according to the ruling.

The platform **does not intervene**.

***

#### Clear benefits for the marketplace

**For the platform**

* Lower support costs.
* Reduced legal exposure.
* Auditable, consistent decisions.
* Scalability without added friction.

**For buyers**

* Confidence to pay upfront.
* Real protection in disputes.

**For sellers**

* Protection against abusive claims.
* Clear rules from the start.

***

#### Why this matters (strategic importance)

Without fair dispute resolution:

* users lose trust,
* prices increase to cover risk,
* or users leave the platform.

With Justly:

* conflict stops being an existential threat,
* and becomes a normal, solvable part of the system.

***

*Most marketplace disputes are typically resolved using **Tier 1 or Tier 2**, depending on transaction value and platform risk tolerance.*

See [Dispute tiers](/how-it-works/tiers/dispute-tiers).