Comment Text:
This comment proposes a dual-layer enforcement architecture for blockchain-based prediction markets, modeled on trust law. The Authority Layer encodes all participation rules, jurisdictional restrictions, dispute resolution procedures, and predefined remedies — permanently, with no ability to bypass. The Rights Layer transfers economic exposure between participants, with obligations re-encoding at every transfer.
This architecture directly addresses the Commission's questions on Core Principle 2 (contract term enforcement and dispute resolution), Core Principle 3 (manipulation prevention), and blockchain-specific compliance challenges (Question 2h). Jurisdictional restrictions and participant eligibility are enforced at the asset level — not the platform level — meaning they cannot be circumvented by accessing the market through a different interface. Dispute resolution and predefined remedies are encoded before the contract is listed, not decided after a violation occurs.
The submitter is an IP attorney and engineer with 20+ years of experience structuring high-value licensing agreements, and the inventor of a patent-pending implementation of this architecture currently live on Arbitrum mainnet.
