Blockchain Domains Starter Guide: What Are They and How do They Work?

Beginner’s Guide / 04.04.2020

Ever since the introduction of blockchain, the world has seen technology disrupt various sectors and industries. With blockchain having some commendable success in supply chain management, health care, and others, experts seem keen to explore other areas where the innovation could come in handy. 

One such area is domain name registration. Although the internet has been evolving over the years, web hosting and domain registration haven’t changed over the years. However, software companies are now looking to change the industry using blockchain domains. 

Blockchain domains are still a new concept. However, given the technology’s success in previous use cases, we can expect the domains to hit in a few years. 

So, what are blockchain domains, and do we really need them? This starter guide will explore all of these domains, how they work, and what benefits they present. Keep reading for some insightful information on the same.

What are the Blockchain Domains?

The simplest definition is that blockchain domains are web domain assets built on a blockchain. They are new web extensions built on decentralized blockchain networks such as Ethereum. They are quite similar to cryptocurrencies in that the assets belong to the domain owner and not any central authority or third-party. 

For a blockchain domain to be operational, developers have to bring together a collection of complex smart contracts to form a human-readable web address. Users are then allowed to register a domain on the blockchain, and just like crypto coins, they get private keys to the domain. As a result, a domain owner has full control over the blockchain domain. 

Blockchain domains are not as popular as traditional web domains and are still in their infancy stage. As such, you may not be able to open or find them through popular search engines such as Google. To open these addresses, you will need additional plugins before browsers become compatible with the blockchain domains. 

Why Do We Need Blockchain Domains?

Considering that blockchain domains are still in their infancy, do we really need them? Will these domains help solve any issues? 

The truth is that the existing web domains come with a variety of challenges. Some of these challenges are:

  • Current domains aren’t resistant to censorship.

Should you choose to buy a domain today, you will get it from domain registrars, companies like Google domains, and Godaddy. These companies are custodians of your domain and have full control over your domain name.

This means that your domain registrar can decide whether or not to give you a particular domain. They can also take down your site at any time by taking the site’s domain. 

Blockchain domains allow users to build websites that are resistant to censorship. Users store these domains in their crypto wallets and have full control over them. Therefore, no one can take down any content published on these sites unless they have access to the private keys provided to the owner. 

  • Centralized entities currently control domains.

The Internet Corporation for Assigned Names and Numbers (ICANN) is the central entity responsible for assigning new domain extensions on the internet. ICANN has full control over domain extensions in that it can decide not to assign specific new extensions. The company can also choose to bring down specific sites, which bars freedom of speech on the internet. Besides, ICANN can be quite unreliable and slow, and you may have to wait for quite some time before getting your new domain extension. 

With blockchain domains, users don’t need any permission from ICANN to launch their sites. They also get to choose whatever extensions they want. Of course, regulators may come in to have some control over the available extensions, but it won’t be as tricky as it is to get a new domain extension from ICANN.

  • Traditional domains don’t support native payments.

Although a core design of the internet was meant to be the free flow of cash, it is quite a disappointment that there are no cryptographically secure ways to send payments. Various innovations have helped with digital payments worldwide, such as PayPal, Visa, Mastercard, and Stripe, particularly successful in the US and other western countries. 

However, none of these solutions integrate easily with other solutions across the world. Blockchain domains will help make payments across the internet native. Because the domains are human-readable, all you have to do is give someone your domain and have them send payments there, instead of providing long alphanumeric addresses or your bank account. 

The seamless flow of payments is made possible because blockchain domains use smart contracts to connect to currencies’ public addresses. Besides, the domains will serve as payment addresses for individuals and businesses that receive donations, eliminating the need for separate features to accept the donations. 

Blockchain Domain Providers

Given that the domains are still a relatively new concept, there aren’t many companies providing these services. However, some of the companies that allow you to buy blockchain domains include:

  • Alibaba

In August of last year, the Chinese retailer filed a US patent for a blockchain domain name management system. The company plans to introduce a unified blockchain domain name (UBCDN) system on top of its blockchain to help denote and share information, allowing for effective data management.

The UBCDN system will help manage blockchain domains in cross-chain interactions. Identifiers on the network will receive readable names, and the company will implement the system in its operations to facilitate complaints on the violation of rights. 

  • Aloaha Blockchain DNS

The Aloaha blockchain provides an ultra-fast and efficient DNS protocol via an inbuilt server. The blockchain uses the server to publish distributed content and certain public information. 

The DNS protocol by the Aloaha blockchain provides several use cases in the industry. For example, the DNS could check the validity of vouchers, validate blockchain certificates, and publish routing information. The system could also be useful in validating transactions on the blockchain.

  • Handshake

This relatively new blockchain DNS launched its mainnet early in February, and developers from MIT are behind the project. Handshake is working together with Namebase to provide users a transparent platform to search and bid on blockchain domains.

The project has been in its test phase over the last year but recently opened its doors to the public. Unlike other blockchain DNS systems, Handshake doesn’t aim to overhaul the existing DNS systems. Instead, the project wants to replace the root servers and root file systems, which are often the lowest in the internet architectural system.

  • Luxe

This platform has created a revolutionary product that looks to serve blockchain users. Thanks to a partnership with Ethereum Name Service, .luxe domains can revolve on the World Wide Web and the ethereum blockchain.

Luxe ensures that users only need one domain name to serve in both blockchain and the traditional DNS. Therefore, you can associate the .luxe domain to a smart contract, wallet, or decentralized app and later associate it with a 42-character Ethereum identifier. The integration of the Ethereum blockchain and the Luxe platform ensures more functionality, greater ease-of-use, and increased security of the domains. 

To participate in the DNS system, users will have to purchase some HNS coins. These coins will facilitate the registration, updating, and transfer of internet names on the blockchain.

Final Word

ICANN has been around for close to twenty years and has been making it possible for businesses and individuals to acquire new domains. However, with the introduction of blockchain domains, it is only a matter of time before internet users move to the more convenient technology.

Given that blockchain domains don’t require an annual subscription, we can expect them to take the internet by storm once fully developed. Also, more blockchain enthusiasts are likely to jump on board with the new technology, and more providers are expected to come up with time. 

Wayne is a Blockchain enthusiast and expert in crypto trading. Currently, he covers trendy issues on digital currencies.