Designing Inclusive Crypto-Asset Dispute Resolution A Hybrid AI and Smart Contract Online Dispute Resolution Framework for Vulnerable Users

The increasing prevalence of crypto-assets has led to complex disputes that are not adequately addressed by current legal redress mechanisms. These disputes are further complicated by the technical aspects of blockchain, their cross-border nature, and inconsistent legal frameworks. This situation disproportionately affects vulnerable users lacking legal or technical expertise, potentially leading to new forms of digital exclusion. Research suggests that a hybrid Online Dispute Resolution (ODR) framework, integrating artificial intelligence and blockchain-based smart contracts, could offer a viable solution to mitigate these challenges.

Why it matters

The rapid growth of crypto-assets necessitates robust and inclusive dispute resolution mechanisms to ensure market integrity and user trust. Failure to address the unique challenges of crypto-asset disputes, especially for vulnerable users, could hinder broader adoption and lead to increased regulatory scrutiny and systemic risk. Developing effective ODR frameworks is crucial for fostering a stable and accessible digital asset ecosystem.

Key insights

• Crypto-asset disputes pose challenges for existing legal and dispute resolution mechanisms.
• Resolution difficulties stem from the technical features of blockchain transactions, the cross-border nature of relationships, and fragmented legal rules.
• Users without legal or technical expertise face significant hurdles in identifying rights, gathering evidence, and pursuing remedies.
• The current landscape of crypto-asset disputes risks creating new forms of digital exclusion.
• A hybrid ODR framework combining AI and smart contracts is proposed as a potential mitigation strategy for these issues, particularly for vulnerable users.

Source

arXiv — Computers and Society — https://arxiv.org/abs/2608.14356