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Group crowdfunding crypto to apply to ICANN for blockchain gTLD

Kevin Murphy, August 11, 2022, Domain Registries

Do we have our first confirmed blockchain-themed new gTLD application? Looks like it.

A group of pseudonymous individuals have announced plans to apply to ICANN for .dao in the next round, and are currently crowdfunding the project by asking for donations in the Ethereum cryptocurrency.

Going by the name DomainDAO, they say they’ve raised 230 ETH so far, which appears to be worth over $430,000 at today’s rates, already probably enough for a bare-bones new gTLD application.

They want to apply for .dao, an acronym for “decentralized autonomous organization”, a type of entity where token-owning participants set the direction of the DAO via rules laid down in software and votes encoded into a blockchain.

DomainDAO’s web site takes a few pops at the likes of Verisign and Identity Digital owner Ethos Capital for alleged unethical practices and says the goal is for .dao to one day “supersede” .com.

The concept differs from other blockchain-based TLD projects, such as Unstoppable Domains, in that it’s not alt-root. The plan is to apply to ICANN to get into the authoritative, consensus DNS root, so that .dao domains can be used by all.

Unstoppable already runs .dao in its own alt-root, selling domains for $20, and has recently proven litigious when it smells a collision from a competing project.

But the main roadblock to the root may well be ICANN itself.

While the rules governing the next round of gTLD applications are not yet set in stone, it strikes me as incredibly unlikely that ICANN will entertain a bid from an applicant that is not a recognized legal entity with a named board of directors that can be subjected to background screening.

DomainDAO is itself a DAO, and the DAO concept is reportedly prone to corruption and hacking, which could make ICANN nervous.

In addition, people funding DomainDAO today are offered crypto tokens that can be redeemed for second-level domains if the TLD eventually goes live — it’s essentially already selling pre-registrations — which could interfere with rights protection mechanisms, depending on implementation.

But DomainDAO claims to have an industry Greybeard on the payroll, a senior advisor going by the handle “Speech-less”, an “Executive with 20+ years experience in domain and ICANN”.

If that’s you, we probably already know each other. Why not get in touch to tell me why this thing is going to work?

Tucows’ domains business stagnates again in Q2

Kevin Murphy, August 10, 2022, Domain Registrars

Tucows’ domain name business has experienced its third consecutive quarter of stagnating growth.

The company yesterday reported third-quarter total domains revenue of $61 million, compared to $62.3 million a year ago and $61.5 million in the second quarter.

Dave Woroch, CEO of Tucows Domains, described this 2% annual decline as “consistency” on a prerecorded address to analysts.

He pointed to Verisign’s recent comments about a decrease in .com registration volumes as evidence of an industry-wide post-pandemic slowdown, but was somewhat bullish on some new gTLDs.

“At the other end of the industry, we do see more robust growth in many of the new gTLDs that are of higher quality and that have little to no speculation or cyber crime opportunity,” he said.

The domains industry is “generally not showing a lot of growth”, he said, adding that “outsized growth would need to come from new areas”, which could include so-called “web3” efforts.

Woroch noted the recent funding of blockchain alt-root project Unstoppable Domains, but said Tucows is not a fan. Unstoppable has, like similar efforts dating back over 20 years, some “fatal flaws” and “a chicken and egg problem” of adoption, he said.

Domains under management at Tucows decreased to 24.8 million from 25 million sequentially and 25.6 million a year ago.

Tucows’ retail domains revenue was down to $8.5 million from $8.9 million a year ago, while the wholesale business, including value-added services, was down to $52.3 million from $53.4 million.

Including non-domains businesses, Tucows’ Q2 revenue was up 11% to $83.1 million and the net loss was $3.1 million compared with net income of $1.8 million a year ago.

GMO to sell Unstoppable’s crypto domains

Kevin Murphy, August 8, 2022, Domain Registrars

Japan’s largest domain seller, GMO, is to sell Unstoppable Domains’s blockchain-based addresses under a new brand.

The company, which owns the registrar Onamae, is launching a site called “CryptoName by GMO” at cryptoname.jp, where Unstoppable’s full portfolio of crytocurrency-themed extensions are on offer.

Unstoppable said it’s first traditional domain name registrar to offer the service.

The CryptoName web site contains an extensive FAQ explaining that the names are primarily designed to address crypto wallets rather than web sites, where they won’t resolve for the vast majority of internet users and won’t be indexed by search engines.

Unstoppable valued at over $1 billion after huge new investment

Unstoppable Domains has received a huge new funding round that the company says means it now has a valuation in excess of $1 billion.

The $65 million Series A round was led by Pantera Capital, with a whopping 17 other venture capital firms taking part, according to the company.

Unstoppable is an alt-root player, offering blockchain-based domains in nine TLDs such as .nft, .blockchain, .crypto and .wallet.

Much of its work to date has been on persuading crypto currency users to use Unstoppable domains to replace the otherwise cumbersome and confusing addresses of their crypto wallets, but the names can also be used to address web sites if you use the right browser software.

Unlike the regular domain name industry, where much of the investment attractiveness comes from the possibility of high-margin recurring renewal revenue, Unstoppable sells its names for a one-time fee. It presumably has other revenue sources in mind for long-term growth.

The traditional domain name industry, ICANN, and potential new gTLD applicants should pay attention.

If, as seems likely, some of the TLD strings Unstoppable is using in its alt-root are applied for in the next new gTLD round, a well-funded competitor that has already proven itself litigious when it comes to name collisions could prove a formidable opponent.

Of course, some potential applicants might see a well-funded alt-root player as an invitation to apply for colliding strings in the hope of a quick pay-off at private auction.

Unstoppable targets another city gTLD with free domains

Kevin Murphy, June 21, 2022, Domain Tech

Alt-root provider Unstoppable Domains has inked another partnership with a city that already has its own gTLD in the authoritative root.

The blockchain domains company said it has linked up with the City of Miami’s Venture Miami project, which encourages tech investment in Miami, to offer $50 in Unstoppable’s alternative domains to anyone attending Miami Dade College or showing up at an event there over the weekend.

For nine out of 10 of Unstoppable’s extensions, that’s enough to buy at least one domain. The company does not charge renewal fees.

It’s the second city recently that Unstoppable has partnered with, following its offer of free domains to all female residents of Abu Dhabi a couple of weeks ago.

In both of these cases, the cities in question already have their own gTLD in the authoritative, functioning, ICANN root. Unstoppable’s extensions, which are largely themed around crytopcurrency, mostly do not function without browser plug-ins.

While .abudhabi has only about a thousand registered domains, .miami, which was acquired from MMX by GoDaddy last year and has the city as a partner, has been more popular, with close to 16,000 names in its zone file currently.

Whether this can be dismissed as more “web3” hype or alt-root snake oil or not, Unstoppable seems to have secured a couple of pretty interesting marketing coups, and it will be interesting to see which city gets targeted next.

Crypto domains: a feminist issue?

Kevin Murphy, June 6, 2022, Domain Tech

Unstoppable Domains has found a novel way to market its alt-root domains service — give away hundreds of thousands of free domains to female entrepreneurs and women in general.

In two separate announcements over the last few days, partners committed to give away well over a million domains, part of Unstoppable’s push to persuade women that alt-roots and “Web3” are good ideas.

First, Access Abu Dhabi, a project of the Abu Dhabi Investment Office, said it will give a domain for free to “all women residing in the UAE capital”, which is believed to be about one million people.

Abu Dhabi is an overwhelmingly immigrant and overwhelmingly male city. Men are believed to outnumber women 2:1 in the UAE, a nation where until this year women could be jailed or flogged for the crime of extramarital sex.

It’s also one of a handful of cities in the world to have its own gTLDs in the authoritative root — .abudhabi and the Arabic-script equivalent — but while fees are not too high (about $40) registration restrictions are pretty strict, requiring among other things a passport scan.

The announcement by Access Abu Dhabi was made in conjunction with Unstoppable Women of Web3, an Unstoppable spin-off project set up a few months ago to pitch alt-root crypto domains to women.

Unstoppable Women is also behind a separate announcement from The Female Quotient, an equality services company, which is promising to give away up to 600,000 domains to women at its “Equality Lounge” events at various tech conferences over the coming months.

Unstoppable’s alt-root TLDs include .x, .crypto, .bitcoin, .coin and .wallet. Prices usually range from $20 to $100, but there are no renewal fees.

Female entrepreneurs obtaining these domains will quickly realize that they don’t work for the vast majority of internet users and are probably not a sound foundation for building a business.

Blockchain domains pose “significant risks” to internet, says ICANN

Kevin Murphy, May 10, 2022, Domain Tech

The internet could be fragmented and made less secure by the proliferation of blockchain-based naming systems, according to a recent position statement from ICANN’s chief technology officer.

The report, “Challenges with Alternative Name Systems” (pdf) worries aloud about systems such as Namecoin, Ethereum Naming Service, Unstoppable Domains, and Handshake.

It says: “the creation of new namespaces without any coordination (either among themselves nor with the DNS) will necessarily lead to name collisions, unexpected behaviors, and user frustration.”

“The end result might very well be completely separate ecosystems, one for each naming system, further fragmenting the Internet,” it concludes.

It’s a pretty brisk, high-level, 15-page summary of the various alt-root naming systems grouped around the “Web3” meme that have been gaining various levels of popularity over the last few years.

It doesn’t drill too far down into any of them and doesn’t really say much that we haven’t heard from ICANN before about blockchain naming, but it does broadly cover what’s out there, how these systems are used, and why they pose risks.

Opposition to alt-roots is an almost foundational principle of ICANN, documented in ICP-3, a 21-year-old document that dates from a time when alt-roots used standard DNS but with different root servers.

ICANN has in the last year pushed back against the newer blockchain-based alts, most prominently by delaying the sale of some gTLD contracts and forcing registry’s to renounce their ownership rights to gTLD strings.

One new addition to the debate that caught my eye was OCTO noting that a lack of coordination between the various alt-roots in operation today presents similar kinds of interoperability risks as does the lack of coordination between the alts and the authoritative root.

It notes that “at least four blockchain-based naming systems are competing today” and as a result “when developing an application, one must decide which blockchain-based naming system to use.”

“As there is no namespace coordination mechanism between those alternative naming systems, name collisions must be expected,” it says.

UPDATE: This story was updated at 2232 UTC to change the headline from “Blockchain poses ‘significant risks’ to internet, says ICANN” to “Blockchain domains pose ‘significant risks’ to internet, says ICANN”