March 1, 2022 / tehnology

What Is Decentralized Domain Name System? What Prospects?

dns

It has not always been as easy to identify websites as it is now. Previously it was only possible with IP addresses that looked something like this: 192.155.1.35. Imagine if we had to remember this string of numbers every time we wanted to access our favorite blog.

Now, instead of these random IP addresses, anyone can identify websites on the Internet. To obtain a domain, you must purchase it from a domain name registration provider, which in turn registers it with the Internet Corporation for Assigned Names and Numbers (ICANN). Rates for domain can range from a few dollars to thousands of dollars depending on popularity and availability.

Even though blockchain has been widely known since 2009, the technology is still considered innovative with the same evolution and public acceptance as the Internet in its early stages. With this began a new era of the Internet. Many proponents call this new era web3.0. Web3.0 is the fusion of existing internet technologies with the benefits of blockchain. While web2.0 worked using centralized domain name and address registration providers, web3.0 introduces decentralization.

What Are Decentralized Domain Name Systems?

In the new world of Web 3.0 apps, decentralized domain name systems will become a new type of domain name servers. In 2017, Nick Johnson and Alex Van de Sande founded the first decentralized name server named Ethereum Name Service (ENS).

The goal of ENS is to make Internet 3.0 easier to access and function like traditional domain name servers. According to the documentation,”ENS’ goal is to map human-readable names like “alice.eth” to machine-readable identifiers like Ethereum addresses, other cryptocurrencies addresses, content hashes, and metadata.

Using ENS, users have the ability to create web3.0 domain names associated with a variety of personal information, such as wallet addresses for various cryptocurrencies, avatars, username, web2.0 domain name service, Twitter account, Telegram, Reddit, and others.

An example of an ENS username would be bob.eth. To send Bob a cryptocurrency, all it takes is a username tied to his address, not a complex combination of numbers and letters (3FZbgi29cpjq2GjdwV8eyHuJJnkLtktZc5).

When creating such a domain, potential owners, in addition to paying for gas, pay for the registration of the ENS name:

  • 5-character .eth names: $5 in ETH per year.
  • 4-character .eth names: $160 in ETH per year.
  • 3-character .eth names $640 in ETH per year.

A domain name must be renewed annually or after it expires. ENS bypasses domain name registration service providers by replacing them with smart contracts. Thus, anyone can purchase a username directly without the need for intermediaries. Users can also sell subdomains of their domains directly to those who wish to purchase them (subdomain example: pay.bob.eth). However, the user may not use such username for any other purpose. The partnership between ENS and the Interplanetary File System (IPFS) will bring the vision of decentralized websites to life.

After ENS paved the way for decentralized domain name systems, other domains built on the .zil, .crypto, .bitcoin, .wallet, .nft, .dao, or .sol blockchains began to emerge. For example, the benefits of acquiring a .sol domain name include lower gas fees and an unlimited expiration policy for all purchased names.

How Viable Will Decentralized Name Services Be In The Future?

First, these domain names are essentially non-fungible tokens (NFTs). Transferring .eth domain name is similar to transferring an NFT from one wallet to another. Decentralized names can also be purchased from various NFT marketplaces such as Open Sea and Rarible.

In the wake of the hype, many people have acquired celebrity and popular brand usernames and listed them on marketplaces. For example, the Nintendo domain name under nintendo-us.eth was registered and offered for sale on Open Sea for a ridiculous price (since it is not certain that the name was registered by Nintendo itself). A .eth domain name has also been registered for Nike, which is selling for $2.7 million at the time of this writing. The list goes on and on. Can it then be said that by the time decentralized name services become mainstream, these popular brands will have to buy the rights to these names from users?

Please note that the use of such domain names is subject to privacy risks. Decentralized name services provide an array of metadata about the user being registered. For example, checking the details of the .eth domain name on the ENS website will show the owner’s wallet address.

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