Dispute resolution

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

Dispute resolution on Bisq has 3 formal levels: trader chat, mediation, 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.

Note for long-time users

Bisq v1.2 introduced a new trade protocol which changed 2 key elements:

• trade funds (deposits, trade amount, and fees) are locked in a 2-of-2 multisig escrow (was 2-of-3 before)
• a time-locked transaction is signed when the trade's deposit transaction is published (more on this below)

Combined with trader chat, mediation, and arbitration, these 2 elements power Bisq’s dispute resolution.

Despite still being called "arbitration", please note that this new arbitration is very different from before: arbitrators no longer have a key to sign deposit funds to either peer. Refer to the article on Arbitration for further details in addition to the process summary below.

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

Responding to chat messages is always optional

If you’re not comfortable responding to chat messages, don’t respond. You have no obligation to communicate over this medium.

Do not send links of any kind

For safety. If you want to send 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 send sensitive information like private keys, passwords, etc

Such information is never wise to share in general, and is never needed to solve trade disputes on Bisq.

Do not engage in foul play

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

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.

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.

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

Level 2: Mediation

If issues remain after chatting with the counterparty, you may need to engage a mediator.

Mediation can only be started after the trade period has ended.

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

How mediation works

Mediators evaluate a trade situation between two users and make a suggestion for a payout. They do not have a key in the multisig escrow, so their suggested payout cannot be authoritative.

Trading peers should do their best to cooperate with the mediator and provide information they request, and are required to respond to messages within 48 hours.

Likewise, mediators may take up to 48 hours to respond to your messages. Please don’t panic if you don’t hear back immediately.

When a mediator suggests a payout:

• if both peers agree with the suggestion, the payout is completed and the trade is closed
• if one or both peers disagree with the suggestion, a peer can choose to engage an arbitrator to re-evaluate the situation (see arbitration below)

When are you eligible for a penalty?

When failing to complete a transaction, you are eligible for a penalty on your deposit. details here

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.

Level 3: Arbitration

Reject mediator's suggestion in order to start arbitration.

Arbitration is the last formal layer of dispute resolution on Bisq. It is meant to be rare. If the measures described below sound extreme, it’s because they are only meant to be employed for extreme circumstances.

Arbitration is only available when:

• one or both traders reject a mediator’s suggested resolution
• the time-locked transaction made at the start of the trade is published

The time-locked transaction sends all funds in the multisig escrow (i.e., those of both trading peers) to the Bisq donation address (owner of this address is bonded and approved by DAO voting). This transaction can only be published 10 days after the deposit transaction is confirmed (for altcoin trades) or 20 days after the deposit transaction is confirmed (for fiat trades).

Think of this time-locked transaction as a "safeguard transaction" or a "fallback transaction"—it's a last-resort option to be exercised only if nothing else is working out.

The time-locked transaction is meant to encourage traders to quickly accept the mediator’s suggestion and discourage nonsensical appeals to arbitrators. The donation address is merely a destination for disputed bitcoin funds to be collected. Every month (approximately), this bitcoin is used to buy BSQ on the market and burn it. This reduces BSQ supply, allowing for new BSQ to be issued as reimbursement for deserving traders through arbitration with minimal impact on BSQ supply. This dynamic essentially makes bitcoin confiscatable, enabling a sort of mutually assured destruction to drive dispute resolution on Bisq without trusted third parties.

Practically, here’s how arbitration works:

1. If you’re dissatisfied with the mediator’s suggestion and sure you are entitled to a better outcome, publish the time-locked transaction as soon as it’s possible and request arbitration.
2. Collaborate with the arbitrator to clarify the details of your case.
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.

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).

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 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.