Non-Fungible Domains

With the advent of Web3, we have seen increasing importance of digital
identity and user-ownership. Non fungible domains will play a key role in this aspect of the metaverse, along with navigating Web3.

Traditionally, the Domain Name System (DNS) has served as the “phone
book” of the internet, mapping IP addresses to human readable computer hostnames in Web2. These domain names hold significant economic value, sold for as much as $872 million in the sale of Cars.com. As such, traditional domain names serve as some of the most critical and valuable pieces of digital infrastructure. However, this system is not able to keep pace with today’s advances of technology. The DNS system requires an inefficient, complex process of continuous renewal payments to intermediaries called registrars. The risk of human error combined with poor service in the oligopoly of registrars poses a major risk to businesses who rely on domain names as a key component of their digital identity, intellectual property, and marketing assets.

Thankfully, this is where Web3 solutions such as non fungible domains come into play for businesses and individual consumers. Non-fungible domains can serve as your crypto wallet address, a Web3 username, a website URL, and more all in one. NFT domains and domain providers, such as Unstoppable Domains and Ethereum Name Service, seek to solve two main issues: digital identity and the Web2 DNS.

Primarily, NFT domains enable consumers to own their digital identity while simplifying the user experience. Non-fungible domains are owned by the user upon which they can build a digital profile they own, manage, and control. With an NFT domain, users can connect numerous services (login, payments, commerce, messaging, verifications, email) to one universal, human-readable domain. For example, Georgetown Blockchain owns hoyas.eth. This means that Georgetown Blockchain can replace long, confusing alphanumeric crypto addresses, such as “19BY2XCgbDe6WtTVbTyzM9eR3LYr6VitWK”, with a universal, human-readable, recognizable name as hoyas.eth. This will make Web3 much
more approachable for the everyday user by mitigating fear around Web3’s complexity and risk for human error. In doing so, non-fungible domains will prove to be a key milestone in moving towards mainstream Web3 adoption. While this provides a significantly better, more simple Web3 user experience, these domains are also fully owned and controlled without
need for renewal fees that the DNS implements. Eliminating the traditional renewal payment system of indefinite rental payments aligns with the core principle of Web3 technology that is full digital ownership. Now individual consumers and businesses will have the ability to easily host websites without the expensive, complex, and corrupt Web2 Domain Name
System of registries and registrars.

Leading providers such as Unstoppable Domains now have over 2.8 million domains registered with 294 coins and tokens supported, and 552 integrations. The Ethereum Name Service has 2.76 million names registered with 508 integrations and 594,000 owners. Such developments in Web3 spark excitement as we continue to see advances to make every internet user a blockchain user.

Written by Louisa Baxter