Trustless Mediation

Definition ∞ Trustless mediation refers to a system or process where disputes or disagreements between parties can be resolved without requiring a trusted third-party intermediary. In blockchain contexts, this is often achieved through smart contracts or decentralized oracle networks that execute predefined rules automatically based on verifiable external data. It eliminates the need for human arbiters or centralized institutions. This approach enhances transparency and reduces counterparty risk.
Context ∞ The concept of trustless mediation is a core promise of decentralized finance (DeFi) and blockchain technology, aiming to reduce reliance on traditional legal and financial intermediaries. Discussions often focus on the design of robust smart contracts and reliable oracle systems to ensure fair and accurate dispute resolution. Future developments aim to broaden the scope and applicability of trustless mediation to more complex contractual agreements.