White labeling prevention is a special case of the problem of getting off-chain information on-chain in a decentralized manner. Several methods have been proposed to address this problem, generally falling under the headings of decentralized oracles, prediction markets, and decentralized justice protocols. In this note, we summarize the results of our analysis of a number of these methods as applicable to the case of white labeling prevention. We conclude that decentralized justice protocols constitute the best approach for the task at hand.
A blockchain oracle is any mechanism for bringing off-chain data on-chain. The simplest way to do this is to have one party post the data on-chain, but that makes the party in question a single point of failure. Thus decentralized oracles are any method of posting data in a decentralized matter.
Some notable examples that were analyzed in our survey (or in a previous phase of our research) include:
With the exception of UMA, the dedicated oracle systems mentioned above work best for on-chaining objective facts that can be readily verified by anyone who cares to. They’re less compatible with questions that require nontrivial amounts of research or subjective judgment—exactly the situations we expect with white-label resistance disputes.
A decentralized prediction market (DPM) is where people can bet on binary outcomes of future events. Those who forecast the outcomes correctly win money, and those who forecast incorrectly lose money. For an introduction, consult What Are Prediction Markets: Explained For Beginners.
Intuitively, the prices of binary options in prediction markets can be interpreted as the mean belief of traders. For a detailed, quantitative account of this fact, see the article Interpreting Prediction Market Prices as Probabilities.
Examples: Presidential Elections, Sports, crypto price prediction, etc.
Source: Augur whitepaper: https://arxiv.org/pdf/1501.01042.pdf