I am not thoroughly versed in the inner workings of dark market so if you
guys have already implemented/discussed this, the feel free to disregard
this email.

It seems to me that posting a bond can be a great way for a new vendor with
no reputation to demonstrate he's a serious seller.

This could work similar to the arbitration service. In fact it could even
be run by the same arbitrators.

The bond service posts its public key for everyone to see. The vendor uses
the public key bip32 style to generate a child key.

He uses the child key and his own public key in a 2of2 multisig
transaction.

The vendor picks whatever amount of Bitcoins to post as a bond. Presumably
the larger the bond the more he can be trusted. Vendor makes a transaction
posting the bond and includes in it his vendor ID and the name of the
marketplace.

To prove he's a trusted seller he can just publish the txid. Buyers can
look at the transaction, see that a bond is posted/amount, see that it was
this vendor who posted the bond not someone else, and verify that the
public key in the scriptpubkey can be derived from the bond service's
public key proving that the vendor didn't just send coins to himself.

If the vendor turns out to be a scammer, the service can refuse to release
the bond, burn the coins, and can post a small tx with the word "scammer"
in it so the vendor can't keep using that txid.

If the vendor wants to withdrawal his bond (maybe he's built up a strong
enough reputation) it needs to be done in a way that doesn't allow him to
scam people with outstanding orders.

The vendor can sign two txs. One sending coins to himself but with a
locktime of, say, 10 days. The other back into the bond address. The
service can sign both and publish the locktime tx. If there are any
disputes in that time period he can publish the second tx and lock the
coins back up.

So great idea, terrible idea, not needed? What say you.

-Chris