The online real estate market has so far encompassed domain names. People and businesses building their online presence need domain names to host their web pages. They either register the domain through a registrar or purchase it from its current owner. With the growing interest in technology built on decentralized networks, we often hear about blockchain domains.
What Are Blockchain Domains?
Blockchain domains are domain names that operate and are stored in a decentralized network or a blockchain. They reside on the same technology as cryptocurrencies and NFTs. Therefore, they are transparent, incorruptible, secure, and free from the control of a central authority.
Like traditional domains, blockchain domains comprise human-readable text strings separated by a period from the domain ending or top-level domain (TLD).
What Are Examples of Blockchain Domain Endings?
Instead of the usual TLDs we see like .com, .org, .info, and .xyz, blockchain domains use the following TLDs:
More TLDs could be added in the future as blockchain domains become more popular and in demand.
How Do Blockchain Domains Work?
Blockchain domains are conceptually the same as regular or traditional domains. However, instead of connecting to an Internet Protocol (IP) address, blockchain domains need blockchain addresses. Here’s a simplified explanation of how blockchain domains work.
You purchase blockchain domains from service providers, such as Unstoppable Domains, Ethereum Name Service (ENS), and Trust Domains. The provider issues an NFT, which serves as your proof of ownership, much like a land title.
The blockchain domain would then be connected to a blockchain address, usually the owner’s crypto wallet. The owner can then point the blockchain domain to a website on the blockchain network or the traditional Internet.
How Can You Use Blockchain Domains?
The primary purpose of blockchain domains is to have a human-readable name for long cryptocurrency wallet addresses. It’s the same as traditional domains. Instead of memorizing the IP addresses of websites, you only have to memorize domain names.
Blockchain domains can also be used as addresses for decentralized websites. Owners can even build applications on blockchain domains. In addition, owners can use the domains as usernames for applications that enable users to log in using their crypto wallets. It’s similar to logging in with our email addresses on multiple platforms.
Threat actors and brand abusers have also found lucrative uses for blockchain domains. They can host malicious content on the domains without fear of them being taken down. For instance, they can buy blockchain domains that imitate famous brands.
What Are the Differences between Blockchain Domains and Regular Domains?
We talked about how blockchain domains need crypto wallets as blockchain addresses while traditional domains require IP addresses to work. There are more differences between these two types of domains, including those identified below.
For traditional domains, registrars like GoDaddy and Namecheap serve as custodians. They have the power to suspend or take away domains in case of breach of contract or nonrenewal. As such, nobody truly has complete ownership of any of the domains they buy.
On the other hand, when you buy a blockchain domain, you own the domain forever. There’s no need to pay a renewal fee.
Traditional domain names are under the control of the Internet Corporation for Assigned Names and Numbers (ICANN). As such, there are specific guidelines to follow. But since blockchain domains are on a decentralized network, owners have full control over them.
They can host content that is otherwise censored on regular domains. Owners can transfer their blockchain domains to anyone without going through registrars and registries.
Blockchain domains reside in blockchain networks. For example, blockchain domains ending in .eth live in the Ethereum blockchain once purchased. On the other hand, traditional domains are stored in Domain Name System (DNS) servers.
Blockchain domains continue to gain popularity among blockchain enthusiasts. Some have legitimate reasons, while others may have nefarious intentions.