How Kleros Arbitration
Resolves Disputes
When buyer and seller can't agree, Kleros' decentralized court system steps in. Randomly-selected, economically-incentivized jurors review evidence and enforce a binding ruling — directly through the smart contract.
New to Kleros? Why you can trust a decentralized court →Step-by-step dispute resolution
Dispute Raised
Either party raises a dispute inside the escrow. A deposit is required from both sides to disincentivize frivolous claims. The disputed funds are frozen in the vault immediately.
Evidence Submitted
Both the buyer and seller have a defined window to upload evidence — messages, screenshots, contracts, delivery receipts, or any relevant files. Evidence is stored on IPFS, permanently and tamper-proof.
Jurors Selected
Kleros randomly selects jurors from a pool of staked PNK token holders. The more PNK staked in a court, the more likely selection. Jurors are incentivized to rule honestly — ruling with the majority earns fees; ruling against it loses staked tokens.
Jurors Deliberate
Jurors review all submitted evidence independently and commit a hidden vote via the Schelling point game. Votes are revealed simultaneously to prevent copying. The majority ruling determines the outcome.
Ruling Enforced
The smart contract automatically enforces the jurors' decision. Funds route to the winning party instantly, no manual action required. The losing party's dispute deposit is redistributed to winning jurors as compensation.
Appeals Available
Either party may appeal the ruling by increasing their deposit. Each appeal round doubles the juror count, making bribery increasingly expensive. Multiple rounds ensure the final verdict is robust and resistant to manipulation.
Common questions
How much does Kleros arbitration cost?
Kleros arbitration is only triggered if a dispute is raised — there's no arbitration fee for normal, uncontested escrows. When a dispute is raised, the disputing party pays a flat fee of approximately $30 in ETH (the exact amount depends on current gas prices and the Kleros court schedule). The winning side gets their deposit back; the losing side forfeits it to the jurors. Vaultion's tiered platform fee (2–4% depending on escrow size) is separate from arbitration and goes to Vaultion for operating the service — it is not used to pay Kleros or jurors.
How long does a Kleros dispute take?
Most disputes resolve within 3–7 days. Evidence submission windows, deliberation periods, and optional appeal rounds each add time. Complex cases with multiple appeal rounds can take 2–4 weeks.
Can Kleros rulings be overturned?
Any party can appeal. Each round multiplies the juror count, making manipulation exponentially more expensive. In practice, honest cases resolve in the first round without needing appeals.
Are jurors experts in the subject matter?
Kleros has specialized courts (Freelancer, Token, etc.) where jurors self-select based on subject knowledge. Escrow disputes are typically handled in the Freelancer court by experienced commerce jurors.
What if evidence is forged?
Kleros uses the Schelling point game: jurors independently assess what's true without coordinating. Fabricated evidence that isn't convincing to an independent majority will simply lose. All evidence is also publicly verifiable on IPFS.
Ready to transact with confidence?
Create a Vaultion escrow backed by the Kleros arbitration network.
