Overview of Blockchain Domain NFTs
With all the hype surrounding cryptocurrency, blockchains, and NFTs, it is only natural we are starting to hear more about NFT domains. We’ll try to shed some light on what blockchain domain NFTs are, how to buy one, and how to access one from your personal browser.
To understand how blockchain domain NFTs work, you’ll first need to understand how DNS (Domain Name System) works in the current Internet, as well as a basic understanding of NFTs.
What is DNS?
The simplest way to think about DNS is as a phonebook for the Internet. Every device connected to the internet has a unique IP address, including a website’s server. So, instead of being forced to remember ‘126.96.36.199’ to type into your browser, you can just navigate to ‘reddit.com’. DNS is the system that allows the conversion of an IP address to a more easily memorable word or phrase.
The DNS network is administered by the Internet Corporation for Assigned Names and and Numbers (ICANN). ICANN oversees the development and architecture of the overall system of top-level domains (such as .com, .info, etc.). Up until recently, ICANN and DNS were the only methods to obtain a working domain name.
What are NFTs?
NFTs, or non-fungible tokens, are unique files on a blockchain. This file contains unique identification and other data, such as name, ownership, descriptions, attributes, and smart contracts, just to name a few. The non-fungible part of the name means the token is unique and not interchangeable with other tokens. This is the opposite of regular cryptocurrency.
As an example, if you give someone a $20 bill in USD, you’re not likely to care if they give you the exact $20 bill back, as long as they return a $20 bill. It’s all worth the same to you. Same goes for crypto – you can exchange ETH (removing gas fees from the equation) in 1:1 transactions all day, but as long as you get your initial investment back, the ETH you end up with is not differentiated from the one you started with.
That NFTs have the opposite properties allow them to represent digital, or even real world, items and track their ownership. This gives us the ability to tokenize ownership which we can later sell or auction off. If you want to read more, here is our detailed guide: What is NFT?
Blockchain Domain Names
Blockchains give us a new way to look at the whole idea of domains. The ability to put domain names on the blockchain itself has the opportunity to flip the entire system on it’s head. Unlike traditional domain names, no organization, or even country, can control or oversee these domains.
Blockchain domain names are stored in a public blockchain where it can’t be deleted, censored, or modified by someone who does not own it. Remember those DNS nameservers from above? Yes, they are all over the world. However, they are still centralized because one organization controls them all – ICANN.
Because of that centralization, blockchain domain names are more secure and more open. Plus, when you finally are ready to create an Ethereum wallet, which would you rather memorize and give out to other people, “0x71C7656EC7ab88b098defB751B7401B5f6d8976F” or simply “yourname.eth”?
Blockchain Domain NFTs
The next step in this almost automatic evolution is to tokenize blockchain domain names to convert them into NFTs. With this transformation comes all the benefits and advantages of NFTs, such that you can trade and rent them, add royalties back to you in perpetuity with every future sale, and auction them.
Currently, the two most popular blockchain domains are .eth and .crypto. They are both on the Ethereum network and can be traded on opensea.io. However, each one is only sold first-hand by competing services to each other.
How to buy a .crypto or .nft domain
If nobody has yet purchased your desired .crypto domain, you’re going to want to visit the first of the two competing services – Unstoppable Domains. Along with .crypto, Unstoppable Domains is the sole first-hand seller of the domains below:
- .blockchain (coming soon!)
The cool thing about buying any of the domains above is that once you buy it, you own it forever! Prices increase with the commonality of the word or phrase used. As an example PotomacRiver.x is $40, while Potomac.x is $8,000!
How to buy .eth domain
Like we mentioned earlier, the .eth domain is also on the Ethereum network, so you get all the good stuff like web3 tools, as well as the ability to buy and sell these domains on the most popular Ethereum marketplaces. If nobody has yet purchased your desired .eth domain, you’ll need to navigate to https://ens.domains/ to start the purchase process.
The first of a few differences with the services is that you’re not able to buy .eth domains for life. They are more similar to traditional domains in the sense that you “rent” the domain for a specified length of time and must renew once that period is over. Cost is still fairly reasonable, though, with the price of registration depending on the length of the registration period. A quick example:
As you can see, you’re paying the same gas fee no matter how long the registration period is. If you do end up renewing your .eth domain name, you’d have to pay the gas fee at the end of every registration period.
Downsides to blockchain domains and NFTs
Today, most blockchain technologies are in their infancy, and the same is true for blockchain domain NFTs. You can be an early adopter, but you’ll need to use some workarounds to get things to function as expected.
Access blockchain domains from your browser
Blockchains, crypto, and their related domains have become so engrained in daily life that Chrome, the world’s most popular browser, now natively supports these extensions.
Just know this one little trick! Not to get too click-baity, but there really is one simple thing you have to do to access these blockchain-based domains. If you don’t, Chrome will perform a search, thinking that’s what you want. All you have to do is remember to put a “/” after the address. An example is instead of https://ethereum.eth, the domain should read https://ethereum.eth/.
A couple additional downsides are, albeit minor, the speed of the site – it will inherently run a little slower than a comparable traditional domain name. Also, there is just simply fewer options in suffixes.
There is a (relatively) new kid on the block when it comes to your browser choice. It is also arguably the first crypto-native browser, but without a doubt the current most popular. That browser is the Brave browser.
Brave comes “out-of-the-box” with an integrated, browser-native crypto wallet and rewards users with a cryptocurrency called BAT (Basic Attention Token) for choosing to view privacy-preserving, first-party ads.
Read our deep dive on the Brave browser here.
Read our story about Brendan Eich here.
As much as we would like, most of us don’t have access to a crystal ball. It’s difficult, if not impossible, to predict the future of blockchain domain NFTs over the coming years. At the moment, they do work but still have some obvious downsides when compared to DNS.
However, there is so much interest in this space that it’s tough to see a future that does not involve vast improvements. Especially when you consider the longer you wait, more and more of the most desirable blockchain domain NFTs will be swooped up! We think the potential is there, so you may as well get in early.