Bitcoin Hivemind (nee Truthcoin) is the authority on doing this in a truly decentralized fashion. The original whitepaper is well worth a read. The fundamental insight: it’s easier to coordinate on the truth than on something else; incentivizing defection to the truth works well.
Judges have reputation. If you judge against the consensus, you lose reputation, and the other (consensus) judges gain it. The amount you lose depends on the consensus: being the lone dissenter has a very small cost (mistakes have costs, but small ones), but being part of a near-majority is very costly. So if your conspiracy is almost but not quite winning, the gain from defecting against the conspiracy is very high.
Adaptations to a non-blockchain context should be fairly easy. In that case, you have a central algorithmic resolver that tracks reputation, but defers to its users for resolution of a particular market (and applies the reputation algorithm).
Bitcoin Hivemind (nee Truthcoin) is the authority on doing this in a truly decentralized fashion. The original whitepaper is well worth a read. The fundamental insight: it’s easier to coordinate on the truth than on something else; incentivizing defection to the truth works well.
Judges have reputation. If you judge against the consensus, you lose reputation, and the other (consensus) judges gain it. The amount you lose depends on the consensus: being the lone dissenter has a very small cost (mistakes have costs, but small ones), but being part of a near-majority is very costly. So if your conspiracy is almost but not quite winning, the gain from defecting against the conspiracy is very high.
Adaptations to a non-blockchain context should be fairly easy. In that case, you have a central algorithmic resolver that tracks reputation, but defers to its users for resolution of a particular market (and applies the reputation algorithm).