Dispute Resolution in Bisq 1

Sometimes Bisq trades don't go smoothly, and dispute resolution is required to determine an outcome.

Dispute resolution on Bisq has three formal levels: trader chat, medition, and arbitration.

Most issues on Bisq are minor and easily resolved when traders communicate with each other. Mediation is intended to resolve the vast majority of remaining issues. Arbitration is a rare last resort measure for extreme scenarios.

Level 1: Trader chat

If you're having any issues completing a trade, or if you just want to keep your counterparty informed (e.g., in case you're delayed completing your end of the deal), you can send your counterparty a message through Bisq's end-to-end encrypted chat mechanism. This allows traders to communicate with each other throughout the course of a trade to resolve potential trade issues quickly without involving a third party like a mediator or arbitrator.

Click this icon to start trader chat.

Trader chat rules

Hopefully, by following these rules you can work directly with your trading peer to solve issues quickly and amicably.

Good Communication is Key

Good communication between traders can resolve most disputes. It's recommended for traders to communicate any issues they're having to keep their peer informed.

However, responding to chat messages is always optional. If you’re not comfortable responding, don’t. You have no obligation to communicate over this medium with traders. You must, however, respond to mediators and arbitrators when needed.

Respect a Peer’s Decision to Avoid Responding

If a peer seems unresponsive or has signaled their intention to refrain from chatting, please respect it and don’t pressure them.

Do Not Send Links of Any Kind

For safety reasons, sending links is prohibited. If you want to share a link, describe it instead.

Not allowed:

https://blockstream.info/tx/4b5417ec5ab6112bedf539c3b4f5a806ed539542d8b717e1c4470aa3180edce5

Allowed:

Hey, could you look up txid 4b5417ec5ab6112bedf539c3b4f5a806ed539542d8b717e1c4470aa3180edce5 in your favorite block explorer?

Do Not Encourage Trading Away from Bisq

Trades away from Bisq lack Bisq’s security mechanisms. If something goes wrong with an off-Bisq trade, you’re on your own.

Do Not Share Sensitive Information

Such information is never wise to share in general and is never needed to solve trade disputes on Bisq. This includes passwords, seed words and private keys.

Do Not Engage in Foul Play

Any attempts to exploit counterparties with social engineering scams, etc., are prohibited.

Keep Conversation Scope Limited to the Trade

Please don’t use Bisq’s trader chat as a general-purpose messenger. Unnecessary exchanges add unnecessary strain to Bisq’s peer-to-peer network.

Keep Conversation Friendly and Respectful

Because friendlier traders resolve disputes quicker, and no one wants to deal with a jerk.

Level 2: Mediation

If issues persist after discussing them with the counterparty, you may need to involve a mediator.

Mediation can be initiated at any point during or after the trade period. To do this, select the trade from the 'Open Trades' list and press 'Ctrl' + 'O'.

Engage a mediator. This button only appears after the trade period has ended.

How Mediation Works

Mediators assess a trade situation between two users and propose a payout suggestion. They don't hold a key in the multisig escrow, so their proposal isn't authoritative.

Trading Peer Expectations

• Cooperate with the mediator, providing requested information (quality proof will be asked for payments or bank issues)
• Respond to messages within 48 hours. Non-response might result in penalties.

Mediator Response Time

Mediators may take up to 48 hours to respond. Please be patient.

Payout Suggestion

• If both peers agree, the payout is completed, and the trade is closed.
• If one or both disagree, a peer can engage an arbitrator to reassess the situation (see arbitration below).

When are you eligible for a penalty?

If a trader does not follow the trading rules, they risk being penalized. Any penalties will be taken from the trader's BTC security deposit.

The trader at fault will be charged the penalty, and their security deposit will be deducted a BTC amount.

The trader that is wronged will receive the BTC penalty as compensation. The payout transaction for the trade will include funds from the other trader's security deposit.

For more information about what to expect, you can see the table of penalties. This table acts as a guideline for traders, mediators, and arbitrators to ensure penalty are applied in a fair and impartial way.

Who are mediators?

Mediator roles are bonded roles in the Bisq DAO. Anyone can propose to become a mediator, but approval will depend on the candidate's familiarity with Bisq trading rules and the network’s need for more mediators at the time a proposal is made.

Once a proposal to become a mediator is approved by DAO voting, the mediator must lock a 10,000 BSQ bond to become active. This bond helps to ensure their continued availability and performance in the role, and can be confiscated by DAO voting in extreme circumstances (negligence, foul play, prolonged absence, etc).

You can see more details (current role owners, regular updates, etc) on the role issue.

Where to communicate with mediators?

You can communicate with your mediator directly in the Bisq app. When you initiate a trade and open a mediation, a support ticket is automatically created within the app. You can find this in the 'Support' > 'Mediation' section.

Communicating with mediators inside the app is preferred.

In case you're unable to communicate within the Bisq app for any reason, you can also reach out to them on Matrix.

Find more information on finding your mediator here.

How to find your mediators?

Your mediator's name should be visible when you open a mediation ticket. Look for it under the 'support agent' column.

If, however, you have a trade not in mediation but would like to know your assigned mediator's name, please refer to Finding your mediator.

Level 3: Arbitration

Reject mediator's suggestion in order to start arbitration.

Arbitration is the final tier of dispute resolution on Bisq. It's designed to be rare, and its measures are intended for extreme situations. Arbitration is only available when:

• One or both traders reject a mediator's proposed solution.
• The time-locked transaction (the delayed payout transaction created at the trade's start) is published by one of the traders.

This transaction sends all funds in the multisig escrow (both traders' funds) to the Burning Men.

The delayed payout transaction can only be published 10 days after the deposit transaction is confirmed for altcoin trades, or 20 days for fiat trades.

Consider this transaction as a safeguard or fallback option, to be used only when other options have failed.

Mediation is expected to be the best resolution for both traders. If a trade goes to arbitration, the arbitrator will pay out the trade amount plus one peer's security deposit. This means the total arbitration payout will be less than the mediation payout. Both traders agreeing to the mediator's suggestion is the preferred outcome. Requesting arbitration should be reserved for exceptional circumstances, such as one peer not responding, or if a trader believes the mediator did not make a fair payout suggestion. This dynamic enables a form of mutually assured destruction, driving dispute resolution on Bisq without relying on trusted third parties.

Practically, here's how arbitration works:

1. If you're trading with an unresponsive peer or feel the mediator's suggestion was unfair, publish the time-locked transaction as soon as possible and request arbitration.
2. Collaborate with the arbitrator to clarify your case's details.
3. If the arbitrator sides with you, they will personally reimburse you.
4. The arbitrator will then request reimbursement from the Bisq DAO for the reimbursements they've paid. This isn't something you need to worry about as a trader, but it's good to know how the process works on both sides.
5. Arbitrators are required to respond to messages within 5 days, so it may take a bit longer for them to respond than mediators (you should still respond to messages within 2 days).

Burning Men Protocol

All trades placed from 1st January 2023 will use a new trade protocol (Burning Men Protocol), designed to further improve Bisq's decentralization. The new protocol is a result of the proposal Distribute Burningman role to contributors who burned BSQ, which was approved in Bisq DAO cycle 41 with 100% approval (do not pay out the security deposit of the trade peer to the arbitration case winner). The protocol change means trades placed from 1st January 2023 will have an important difference should the trade end in arbitration.

This change means that if a trade ends in arbitration, the arbitrator will only payout the trade amount plus one user's security deposit. Traders ending in arbitration will notice the following: The arbitration 'winner' will not be compensated for the inconvenience caused by the trade going to arbitration. The arbitration 'loser' will not be refunded their deposit partially or in full.

This change is necessary for the security of the new protocol.

Remember, arbitration should be seen as a last resort. All efforts should be made for traders to come to an agreement with themselves or via the mediator.

If all else fails

One advantage of a flat, decentralized governance structure that encourages user involvement is that no user should ever feel hindered from receiving a fair trade outcome because of a single individual's decision. Bisq isn't a black-box corporation with inscrutable processes. It's an open software project that is governed openly.

Therefore, for whatever reason, if the process above doesn't work for you, you can make a make a reimbursement request yourself in the Bisq DAO. The Bisq DAO not any single individual is the ultimate arbiter of policy and decision-making for all things Bisq.

In fact, this is how arbitration will eventually be handled anyway.