One could get a product / seller banned by voting. Enough votes lead to listing erasing. After a first report, the product wouldn't be accessible to anyone until vote ends.
Illegal products wouldn't remain accessible more than a couple hours.
I also pictured some members roles, where most trustable users ( dispute ratio, number of orders ... ) would have more weight in votes, and would moderate the market. They could get a revenue from a dedicated pool even.
Decentralization is not a human nature. By creating a decentralized marketplace, you are trying to bring anarchy in social animals, it doesn't work that way because humans, i.e. social animals, always try to team up, group together and centralize the power. Over time, that will happen to decentralized marketplace.
This market is not for average users. Its a crypto-enthusiasts dedicated market for those who care about privacy. For some, sharing infos with big companies is a big deal. I do care.
If it's not for average users and only for crypto-enthusiasts, then it will still be very hard to keep it alive. Number of crypto enthusiasts is low, the number of those who are paranoid about their privacy, is super low. If number of your customers will be super low, then there won't be enough goods placed on your decentralized marketplace, so it will eventually die and people will be forced to use eBay & Amazon.
Also, I don't get it, why are some people so paranoid about their privacy? I sometimes think that some people work online and never go out to protect their privacy or if they go out, they were hoodie and dark sunglasses. Doesn't make sense.