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Since the modern internet has made it incredibly easy for economic activities to be done across borders, different countries across the globe are becoming increasingly connected. And while commercial activities globally seems smooth on the consumer side, the back-end of many business operations involves myriad disputes which often involve lengthy legal duress.

The technological advancements of the digital age has disrupted virtually every industry, but the legal system has remained almost untouched and static. Most industries are seeing new participants, that are able to generate a service at an economic scale — dominate the market share. On the other hand, the legal system remains expensive and slow, especially when it comes to the arbitration of cross-border disputes.

Efficiency in the handling of legal operations can enable increased business activity with lower operational frictions. Decreased costs can enable more entrepreneurs to enter global commerce as the fear of legal fees would be mitigated. A startup blockchain project aims to provide legal services at mass scale by leveraging the fundamental principle of blockchain technology — decentralization.

## A Novel Legal System

**Kleros** is a platform that decentralizes the legal process of arbitration. Instead of allowing lawyers and law firms represent clients and arbitrating the process on their behalf, **Kleros** offers a decentralized network of resolving conflicts.

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One of the most important benefits of blockchain technology is to provide immutable digital records — however, blockchain 2.0 introduces an era of smart contracts. **Kleros** integrates these 2 factors to create immutable contracts that can be analyzed by oracles to arbitrate any conflict.

Parties to a legal agreement can create a Smart Legal Agreement (smart contract) and deposit funds into the contract. Should the agreement be successful as intended, the contract releases the funds to the rightful recipient. However, if there is a dispute among the participants of the agreement, a decentralized network of Oracles can be called upon to arbitrate the process.

## The arbitration process shall work as such:

- The disputing parties shall make a claim.

- Oracles, who meet the minimum amount of staked tokens, will weigh in on the evidence provided by the disputing parties.

- The party that receives the majority of the Oracles vote will receive the funds held in the Smart Legal Agreement; the Oracles voting for the losing side will lose their stake.

### Expensive to be Unjust

**Kleros's conflict resolution system goes further off the classic PoS mechanism**

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As Smart Legal Contracts will contain unalterable terms of the contract, **Kleros** system will simply need to match the evidence provided by disputing parties with the terms stated in the contract. The Oracles have staked tokens to gain the right of weighing in. The loss of staked tokens incentivizes Oracles to make the right decision.

The platform will be available for free for 3 resolution requests per month. After that, enterprises that utilize the service must pay a fee. A portion of these fees will fuel rewards for Oracles. Thus, Oracles are incentivized to remain just to gain their share of the reward and to avoid loss of their staked tokens. This is a sharply different from the current legal system where the jury has nothing at stake and faces no penalty for giving an improper decision.

## Immediately Applicable

Given the prominence of the gig economy and online fund raising, **Kleros** can remove the trust factor between agreements. Provides the required APIs to external enterprises so that they may seamlessly utilize the dispute resolution protocol designed by **Kleros** ecosystem. 

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Furthermore **Kleros** can offer freelance contracts which can be issued as Smart Legal Agreements; fundraising on platforms like Kickstarter can ink terms on Smart Legal Agreements; ICOs can be launched with the integration of Smart Legal Agreements. Smart contracts are proven methods of providing an escrow service.

However, a lot of commercial activities are complex beyond basic contractual agreement and terms; and off-chain incidents can render the decision-making power of a smart contract moot. Hence, an Oracle network that serve as a decentralized jury system occupies the gap to provide arbitration when necessary.


## Wrap Up 

**Kleros** project is ethereum based. The project oh l8sted cored on leveraging the immutable benefit of blockchain technology together with the effectiveness of smart contracts to improve the state of the arbitration system. The proposition and usecase of Kleros project is an incredible utility of blockchain technology and demonstrates the substantial advantages tholat decentralization can offer to judicial as l and legal systems as well as to commercial activities between parties. 

**[WEBSITE](https://kleros.io/id)** | **[BLOG](https://blog.kleros.io/)** | **[TELEGRAM](https://t.me/intelligent_community)** | **[TWITTER](https://twitter.com/Kleros_io)** | **[MEDIUM](https://medium.com/kleros)**