Escrow router and prisoners dilemma

They both treat the case of two strangers playing an exchange game. 




The outcome of the game is,

1) They both do the right thing, lowest total transaction costs
2) They both do the wrong thing, highest total transaction costs
3) They split, one a big loser, the other a big gainer

The game is as follows:

Both players legally agree to the exchange contract by engaging the router device. Each player promises to register a ledger entry into one (of possibly two)  specific ledger(s); favoring the other party.  Each player can reverse their entry, for an increasing fee, within a known timeout. Thus each play can check if the other seems to be a scofflaw, law breaker; and is free to pay for a reversal.

Now outcome 1 mostly happens, players are veteran traders, their chosen ledgers not subject to sudden and expensive congestion spiking.  Outcome 2 would happen often enough when the ledger gets suddenly congested, or one of the players is known to frequently reverse trades making for early reversals on both sides.
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When outcome 3 happens, the contract was broken, a civil liability incurred. A debt and the sheriff are involved, possibly a bankruptcy proceedings. However honest players want to stay in the game, they acknowledge the liability and reverse the trade, or the stopped trade is released and confirmed; the world is made right. All is OK when an opportunistic winner wants to keep within the law.

So that just leaves is with case 23and a scofflaw, a law breaker.

My claim: There is no point where the scofflaws succeed for long, they leave a trail and the reverse on timeout system leaves funds available, like any insurance program, to chase the scofflaws.  Scofflaws are soon driven from the liquidity nets, they lose badge power.  We have a finite, observable scofflaw queue we can control, thus escrow rouging can be a congestion priced service.

Trading pits do it different

CoinBase has to keep, what is essentially a hot wallet for all parties during the transfer. And keeping those wallets is an insurable option in and of itself, CoinBase buys insurance against theft.  Coinbase has a lot of code looking for bilateral transfers and aggregation, concentration and unusual congestion.  They have their own active, trusted miner within the coinbase queues, watching for scofflaws.

The great simplifier

All the potential leaks in any hot wallet systems are tied to thumb prints, biometrics.  When you or your bot interfere,s whether you are an administrator or trader or pit boss; we get a thumb print back to only you, a single quantized person.  This is the ultimate bounds on the sandbox, or personal contract manager. It can secretly obey a contract, including its cancellation.  Eventually this smart tech has the spectre compatible mode, it can, by itself, act a escrow router, it can hold bearer digital assets.