As it stands now, not many people use the arena because random people can join in and gang up on you without much you can do about it, so this is my fix for that.
The 1v1 Arena part is as straightforward as it sounds, but I also suggest a way to "risk" certain items as the player who is in the 1v1. Like I wager 10 diamond blocks I can beat you and you wager a totem of undying. Winner takes whatever the person had on them + both risks. The risk part is only to prove that someone has something on them that they say they have, it would be displayed much like how items are displayed in the trade post
The betting part is straightforward as well, just a secure way for spectators to bet on fights.
There could also be a way to call for a draw by having each player stand on their respective pressure plates on either side of the arena, which would refund risks and bets