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Status: Live (Public Adversarial Dispute)

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The real problem in Web3 (beyond ideology)

Web3 systems are designed to be trustless, but real-world interactions are not. On-chain protocols increasingly handle:
  • peer-to-peer payments,
  • tokenized assets,
  • services exchanged for crypto,
  • DAO governance actions,
  • cross-protocol interactions.
Wherever value exchange meets human behavior, disputes inevitably arise.

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Common dispute scenarios in Web3

These are not hypothetical edge cases — they happen daily:
  • A DAO member claims funds were misused.
  • A service provider receives payment but is accused of not delivering.
  • An NFT is sold with disputed attributes or usage rights.
  • An escrow contract releases funds incorrectly.
  • A protocol upgrade or governance action is challenged.
  • A cross-chain or DeFi interaction behaves unexpectedly.
Smart contracts execute perfectly — but they cannot interpret context.

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The current workaround: “off-chain judgment”

Most Web3 protocols resolve disputes through:
  • Discord discussions
  • DAO forum debates
  • Multisig discretion
  • Core team intervention
  • Emergency admin keys
  • Social consensus
This creates contradictions:
  • ❌ Protocols claim decentralization but rely on trusted actors.
  • ❌ Decisions are opaque and socially enforced.
  • ❌ Outcomes depend on influence, not rules.
  • ❌ Legal and reputational risks accumulate off-chain.
In practice, many “trustless” systems re-introduce trust through the back door.

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The key insight: trustless execution needs neutral judgment

Smart contracts are excellent at:
  • enforcing rules,
  • moving assets,
  • executing deterministic logic.
They are bad at resolving ambiguity. Dispute resolution is the missing primitive:
  • not for every transaction,
  • but for the moments when rules alone are insufficient.
👉 Without a native dispute layer, decentralization breaks under pressure.

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How Justly integrates with Web3 protocols

Justly functions as a protocol-agnostic dispute resolution layer. It can be plugged into:
  • DAOs,
  • DeFi protocols,
  • NFT marketplaces,
  • on-chain escrow systems,
  • cross-protocol workflows.
A typical on-chain flow:
  1. A smart contract flags a transaction or state as disputed.
  2. The dispute is registered on Justly.
  3. Parties submit evidence (on-chain + off-chain references).
  4. Independent jurors are selected.
  5. Jurors evaluate according to protocol-defined rules.
  6. A ruling is returned on-chain.
  7. The original contract executes the ruling automatically.
No admins. No emergency keys. No social enforcement.

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Example: DAO treasury dispute

  • A DAO allocates 50,000 USDC to a contributor.
  • Community members dispute that milestones were not met.
  • Funds are escrowed in a smart contract.
  • Justly is triggered as the dispute resolver.
Jurors evaluate:
  • agreed milestones,
  • on-chain activity,
  • submitted deliverables.
The ruling:
  • releases funds,
  • partially refunds,
  • or returns them to the DAO treasury.
The DAO does not vote emotionally.
The contract enforces the outcome.

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Why this matters for Web3 protocols

For protocol designers
  • Removes reliance on centralized governance interventions.
  • Reduces attack surface (admin keys, multisigs).
  • Enables cleaner, rule-based protocol design.
For DAOs
  • Fair handling of internal conflicts.
  • Less governance fatigue.
  • Clear, enforceable outcomes.
For users
  • Higher confidence interacting with on-chain systems.
  • Protection in ambiguous situations.

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Dispute resolution as a Web3 primitive

Just as:
  • oracles connect blockchains to reality,
  • bridges connect chains to chains,
👉 dispute resolution connects code to human context. Protocols without it:
  • work until something goes wrong.
Protocols with it:
  • can safely scale real economic activity.

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The takeaway

Web3 doesn’t fail because smart contracts are weak.
It fails when human disputes have nowhere to go. Justly provides:
  • neutral judgment,
  • on-chain enforceability,
  • protocol-level trust.
Protocol-level disputes often leverage Tier 2 or Tier 3, depending on the value locked and the social impact of the decision. See Dispute tiers.