A ground-breaking white paper is set to be published by the DNS Research Foundation (DNSRF), a not-for-profit organisation, predicting explosive growth of blockchain domains, which is expected to reach 12.8 million by 2026 at the current proliferation rate. This increase will surpass the total size of national top-level domains from countries such as China, the UK, the Netherlands, and Russia.
The research indicates the rapid growth in blockchain domain registrations, without proper governance, may result in widespread name disputes with the existing DNS system. This could potentially cause substantial disruption in consumer internet use and pose public safety and cybersecurity risks. The forthcoming DNSRF white paper entitled "Blockchain Domains: Disruption and the Domain Name System: Understanding the Trends of Blockchain Domain Names and the Policy Implications" analyses these risks in depth.
Many notable brands, including Gucci, Puma, Manchester United, Nike, and celebrities like Snoop Dogg and Paris Hilton, have already invested in web3, showing escalating competition within the domain landscape. Simultaneously, an expanding adoption of blockchain-based applications by major browsers like Opera, Brave, and Google Chrome (through an extension) could significantly accelerate the use of blockchain domain names.
One of the report's authors, Georgia Osborn, explains, "Blockchain domain names do have some unique and novel benefits. They have no custodian, and the domain name is stored by the owner, so a third party cannot easily move or seize them. They can also be used as payment gateways for cryptocurrency transactions involving multiple different currencies, making managing these transactions easier."
However, she notes that there are significant risks associated with the rise of blockchain domain names without adequate governance, including the absence of legal mechanisms for domain names that infringe on brands or trademarks, no simple way to resolve disputes around domain name collisions, and an increased risk of internet crime due to the anonymity of domain name ownership.
Nathan Alan, Co-author of the report, adds, "In theory, many innovations in the Web 3.0 world have merit. However, there needs to be governance standards and cooperation within the blockchain community to protect a free and open internet. Pragmatic cooperation between the blockchain and DNS worlds is crucial. Without this, the rapid growth of blockchain domain names poses a significant risk."
Emily Taylor, Chief Executive at DNS Research Federation, also expressed concern: "The growth of blockchain domains is extraordinary, considering the current limited usage options. As of now, only a few major browsers can enable them. If more applications and browsers start supporting blockchain domains, we could see an even sharper increase in their numbers."
"A key strategic and governance issue, at present, is the lack of interoperability between blockchain domain names and the classic DNS," says Emily. "Without engagement in open dialogue with the DNS community by leading blockchain domain providers, we face a significant risk of internet fragmentation."