Big brands are scooping up domain names with the .eth suffix, the web3 of the .com. But is .eth the new .com, or just more web3 hype?
The Ethereum Name Service (ENS) is a distributed naming system for web3 applications based on the Ethereum blockchain.
Instead of being identified by a long line of numbers and letters that comprises a cryptocurrency wallet address, an ENS domain links this address via smart contract to a more human-friendly domain name.
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One look at the latest .eth leaderboard, ranked by most Twitter (TWTR) followers, reveals the celebrities and corporations that have already registered a name.
In first position we have fallon.eth, taken by talk-show host Jimmy Fallon, and there is also vitalik.eth in ninth place, acquired by Ethereum co-founder Vitalik Buterin.
Most of those on the leaderboard are owned by the actual corporation or celebrity whose name it references, but there are also many domain names that are being ‘squatted’ by anonymous purchasers and these names are gaining value as more people begin to use web3 applications.
After the ENS registry was set up many people rushed to ‘squat’ meaningful names representing big brands and celebrities.
Some anonymous individuals have ‘squatted’ thousands of domain names.
For instance, amazon.eth has not yet been acquired by the online shopping giant Amazon (AMZN), but a bid was recently placed for this ENS domain name on OpenSea for a sizeable amount.
The initial price in 2019 for amazon.eth was 100 ether, worth around $50,000 at the time.
However, this month the Ethereum Name Service domain amazon.eth received an offer for 1 million USD Coin (USDC-USD), a stablecoin pegged to the United States dollar.
The bid came from an anonymous wallet address on the OpenSea NFT marketplace.
The offer to buy the amazon.eth domain was not responded to and no transaction took place.
This is despite the last sale of the domain name on Opensea going for 33 ether (USD-ETH), worth around $100,000 at the of writing.
This offer that was ten times the last sale price had crypto-commentators speculating that a web3 domain name gold-rush could be about to ensue.
But will the new .eth domains appreciate in value in the same way that .com domains did in the early days of the internet.
Yahoo Finance asked Samantha Yap, founder and CEO of YAP Global, if .eth was the new .com? Yap said it certainly is.
She added: “It’s the best way to reserve a wallet personally and/or for your business on Ethereum. The only issue is that since the Ethereum Blockchain is transparent, anyone can track your financial transactions on the blockchain.”
Samantha Yap gave advice to big brands who want to get into web3, “that they should seriously consider reserving their ENS domains before it gets too expensive”.
She added: “It’s like reserving a domain name for a new company that wants to launch. If brands don’t do this soon, they could get left behind or be seen as lagging behind the curve. Imagine if Nike didn’t have nike.com. It’s the same thing for having a .eth.”
According to Anirudh Chohan, Brand Marketing Lead of Safe, previously Gnosis Safe, the difference between the ENS project and the legacy DNS registry, is that “ENS has lived up to web3 ideals by creating a decentralised entity that issues self-custodial domains that are not managed by a centralized authority”.
Speaking to Yahoo Finance, Chohan added that “these new domain assets presents significant opportunity for participating in the evolving world of metaverse including those related to: gaming, fashion, media, and more.”
Yahoo Finance also spoke to one of the core developers behind ENS, Makoto Inoue, who said that big brands have started to take interest .eth domains in the last couple of years.
Budweiser (BUD) acquired beer.eth last year, the NBA has taken nba.eth, and sports apparel company Puma have puma.eth.
Inoue explained why companies could benefit from getting this early footprint in the web3 world.
He said that it was “important for brands to have a .eth domain name as it shows that they have taken the first step into the web3 world”.
An .eth domain gives brands a web3 identity and allows for a more user-friendly name for their Ethereum wallet.
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Inoue added: “People can easily search and find the collections of NFTs that are stored on someone’s digital wallet by searching their ENS name.
“And, as adoption of the whole cryptocurrency ecosystem accelerates people and corporations will realise they need to have a user-friendly web3 identity.”
This will become important when people want to purchase a brand’s NFT collection as an ENS name is much easier to search than the long line of digits used to demark wallet addresses.
Having an ENS domain name will tie all of a person’s digital ownership within the Ethereum blockchain under one easily named and identifiable address.
Some .eth names cost thousands to buy on the secondary market on the Opensea NFT marketplace, there is also the cost of registering them with ENS and the gas fees to transfer the ‘smart contract’ on the Ethereum blockchain.
I looked into the cost of registering my own name on the ENS web3 domain registry, brianmcgleenon.eth was available and would cost around $5 in ether to register it for a year, plus around $30 in gas fees to settle the transaction.
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