Websites have become a doorway for individuals to utilize and engage with the Internet as the world has become a global village. The “dot com” extension has been commonly used since the first website was hosted in the early 1990s. This resulted in the well-known “dot com bubble” a few years ago. However, with the introduction of blockchain technology and its offshoots, the Domain Name System is being supplanted by the NFT domain system. According to reports, the NFT domain name “win.crypto” was sold for $100,000. One of the most successful NFT domain registrars, Unstoppable Domains, said in February of this year that it had over 2 million registered domains. This demonstrates that NFT domains are quickly becoming the standard, replacing the dated domain name system.
The Inner Workings of NFT Domains
Before you can understand how NFT domains work, you need to know what a non-fungible token, or NFT, is. NFT is a unique, digitally protected object. Digital art is often produced with NFTs. If an artist makes an NFT for a GIF or a video, for instance, they can sell it along with the rights that go with it. So, in many situations, an NFT is like a title deed for a digital object. Blockchain technology underpins NFT. Information about an object is stored in a chain of blocks that are linked together, and this information is stored in a decentralized way in a peer-to-peer network. An NFT domain uses the same technology. The blockchain has information about the website’s or domain’s owner as well as its content. Like cryptocurrencies or NFTs, the NFT domain is kept in a wallet. This means that you don’t need the Internet or any other third-party providers. NFT domains are also used to make it easier for people to trade cryptocurrencies. NFT domain endings are different from domain endings (top-level domains) in that they are not officially released by ICANN. Instead, each provider releases and manages their own NFT domain endings. These can be various “Web3” players, like Unstoppable Domains, which focuses on NFT domains. Since ICANN doesn’t release NFT domains, they aren’t listed in the root directory of the Domain Name System (DNS). So, you can’t get to them with all browsers, or you have to use a plugin. Another issue is that ICANN could, in theory, approve the same top-level domains for the official Domain Name System in the future.
But Why All the Hype?
DNS servers throughout the world function like phone books, converting website domain names into machine-readable IP addresses. ICANN, the Internet Corporation for Assigned Names and Numbers, is a non-profit organization that administers everything, including the creation of new TLDs and the oversight of SLD registrations. As blockchain technology gained popularity, developers sought ways to decentralize internet names, which led to the creation of NFT domains. By registering new TLDs on the blockchain, crypto domains can sidestep ICANN and open the door to millions of new domains. The first thing that everyone who buys an NFT domain usually does is connect it to a cryptocurrency wallet in order to receive cash. “Domain resolution” enables human-readable NFT domains to automatically send payments to the relevant currency addresses in a wallet, such as Bitcoin to its BTC address, Ether to its ETH address, and so on. Developers also employ NFT domains to connect to decentralized Web 3.0 apps, the number of which has expanded dramatically in recent years. You may also build your own website or application on top of it. You may also alter or delete your website content since your crypto domain name is stored on a blockchain as an NFT and published on IPFS, InterPlanetary File System, a decentralized storage system. Finally, you may create, buy, or sell NFT domains. In fact, prominent blockchain domain names have a robust resale market.
Closing Note – Should You Buy an NFT Domain?
Blockchain technology promises to decentralize the Internet and put individuals in control of their internet domains. The more the adoption of Web3, the greater the demand for an NFT domain. Given the numerous benefits and applications of NFT domain names, it is just a matter of time until people abandon regular domains. Indeed, the NFT domain represents the true future of DNS. Therefore, the best time to get an NFT domain name would be now.