Dispute Bond

Bond

To initiate a dispute, the disputer (an address that invokes the dispute call) will need to deposit a bond upfront. The bond will be returned to the disputer if a dispute is successful or resolved by bother parties through settlement or arbitration. Otherwise, the bond is confiscated by Story and the disputer loses its bond deposit. Such implementation aims to prevent waves of spam disputes.

Bond Price

To ensure a smooth onboarding of users, IPs, and protocols, the bond price will be fixed to begin with. Anyone can initiate a dispute by depositing a bond into the dispute module corresponding to the IP Asset in question. But as discussed earlier, the bond price will evolve to be dynamic based on the IP Asset's commercial score. The bond price will vary based on two factors: the disputer and the commercial score of the IP Asset in question. The following formula expresses the bond price $B$.

$$B = \rho C \cdot (1 + \mu - \frac{D_{s}}{D_{t}})$$

Where:

• $\rho$ is a fixed scaling factor where $0 < \rho < 1$.

• $C$ is the commercial score for the IP Asset.

• $\mu$ is a fixed positive threshold factor where $0 < \mu < 1$.

• $\frac{D_{s}}{D_t}$ is the number of successful disputes over the total number of disputes initiated by the disputer (address), representing dispute success rate. If there's no past disputes, we set this term to 0.

Key Points:

• $\rho C$ represents the base bond dispute price, which is a small fraction of the commercial score (i.e. legitimacy adjusted stake weight).

• $\mu$ is a small positive threshold so that the second term in the equation never equates to 0.

• The higher the success rate of a user's prior dispute history, the lower the bond price needed to deposit to initiate a dispute.

• The higher the commercial score $C$ of the IP Asset, the more expensive the bond price needed to deposit to initiate a dispute.

Dispute Initiation & Rejection

When an address raises a dispute and deposits a bond that's below the bond price for the IP Asset, the dispute initiation fails and is immediately rejected. This dispute threshold prevents spammers from disputing and attacking valid IP Assets for malicious intentions, and protects $verioIP stakers from their stakes getting frozen when the underlying IP is actually legitimate.

To prevent an IP Asset from getting spam disputed, it's extremely important to have a high commercial score. As such, although stake weight decreases over time in evaluating an IP Asset's legitimacy $V$, stake weight still plays an important role when calculating an IP Asset's commercial score $C$. Consequently, creators, especially those who are earning significant royalty revenue, should dedicate a portion of the revenue as incentives to attract stakers and maintain a high commercial score over time, raising the bar for disputers and keeping the IP Asset dispute-free.