In fact, how are disputes settled at all? I've only been scammed once (and it was probably for the best, I love stims too much to get into a meth habit) and it was on The Marketplace and the admins fucked up the dispute anyway so I never got to see how it really works. Can someone describe that process to me?
And with transaction arbiters...
How can you settle a dispute without sacrificing your privacy to the arbiter?
How do you prevent LE from becoming arbiters and seeing things that'd incriminate people? I'd imagine it would be much easier to become an arbiter than a full time member of the staff of a site.
How do you rate an arbiter? Whoever loses the dispute will likely file a bad review on the arbiter, but you need a review system to stop arbiters from just choosing a side at random to give the money to so they get paid faster.
How will an arbiter be chosen for a transaction? Random selection opens the door to people who just want fast money and don't care about the transaction's outcome, and selection based on rating is hard because rating arbiters is hard.
Here are my opinions.
Mix the fuck out of your coins.
Arbiters should be marketplace owners and other vendors. 1 key held by the vendor, 1 key held by the marketplace, and a 3rd held by another vendor who releases the money to whoever the marketplace determines should receive it in the case of a dispute.
The marketplace should be the one who makes this decision.
The 3rd arbiter in a transaction should be another vendor - one who has a sold transaction record. And the 3rd arbiter should be required to toe the line decided by the marketplace.