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Bob Hawkes

What Does The NFT Craze Mean For Domain Names?

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By Bob Hawkes, Mar 30, 2021
  1. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    It is hard to read anything these days without some mention of NFTs, non-fungible tokens. Earlier this month, Christie’s auction house sold a Beeple NFT collage “The First 5000 Days” for $69 million. Mike Winkelmann, Beeple, who operates on the interesting domain name beeple-crap.com, has used NFTs more successfully than any other creative.

    While NFTs are often associated with digital art, the concept can apply to any unique product. Domain investors have been rushing to register NFT-related domain names, and a few have invested directly in non-fungible token creative works.

    What is a NFT?

    Let’s start with the definition of a fungible asset. If I borrow $20 from you, and then later repay, I don’t need to give you back the same $20 bill, as it is commonly agreed that another $20 bill has equivalent value. These are fungible assets, and would include cash, stocks, cryptocurrencies, commodities and numerous other items. The item has a value that is not associated with being unique.

    A non-fungible token, or NFT, is data stored on a blockchain ledger that represents a unique, usually digital, item. The NFT establishes ownership and authenticity, although see caveats below.

    While NFTs are often associated with digital art, they can represent any unique item, and have been sold for music, written works, video clips, trading cards and other products.

    What you receive as owner of the NFT varies. In essence you are claiming ownership of the digital token associated with the work. You do not own the original artwork, nor the associated copyright. Various add-ons are sometimes included, such as tickets to private performances or unique unpublished associated work.

    History and Applications of NFTs

    While the roots of NFTs date to at least 2014, several NFTs released in 2017 are usually considered the first real implementations. Matt Hall and John Watkinson released 10,000 unique CryptoPunks that year.

    This month, Kings of Leon became the first band to release an album as an NFT. The album, When You See Yourself, includes several types of add-on personalized assets, including front-row concert seats and exclusive audiovisual art. You can see more about the digital content, and how the redemption works, at the site of the company that developed the NFT for the band, YellowHeart.io.

    While NFTs represent unique products, NFTs are extensible. You can use two NFTs to ‘breed’ a new NFT. This is perhaps best exemplified by Cryptokitties.

    Blockchain technology has been mature for a while. Why did NFTs suddenly take off in the last few months? There are probably several reasons.
    • NFTs permit artists to circumvent intermediaries and interact directly with fans and clients. That has become more important during the pandemic.
    • The rapid rise in cryptocurrencies has created new wealth for some. Those who benefited from the rise in Bitcoin are exactly the same people open to the idea of other types of blockchain-enabled assets, such as NFTs.
    • NFTs make it easier to exchange, including fractional ownership, valuable creative works associated with tokens.
    • The current financial market has people looking to diversity to different types of assets beyond traditional stocks and bonds.
    An Unregulated Market

    There are a couple of caveats to keep in mind when considering NFTs. While the authenticity of the ownership chain is established on the blockchain, there is no automatic guarantee that the original NFT was indeed by the assumed creative. It is important to do your due diligence before purchasing a NFT. Secondly, the NFT field is essentially unregulated. Auction houses selling some of the products are, of course, regulated, but NFTs in general are not.

    Registrations of NFT Domain Names

    If the current rise in NFT interest continues, we will see a variety of websites handling NFT transactions, and a corresponding need for domain names.

    According to dotDB, the acronym NFT is registered in 513 domain extensions. The plural, NFTs, is registered in 351 TLDs. NonfungibleTokens is taken in 90 extensions, and the corresponding singular form in 110. Strictly speaking, non-fungible is usually considered a hyphenated word. The hyphenated term non-fungibleToken is registered in 58 TLDs, while the plural non-fungibleTokens in 24.

    There are a number of NFT-related discussions on NamePros, but the first places to discuss and showcase domains related to NFTs was started by @newshunter. More recently, @du6262 started Are NFTs a Trend?, which has become very active.

    This post by @NameYourself shows the number of NFT-related domain names registered each day in 2021. There have been typically 400 to 1200 NFT .com domain names registered per day during the past month, and a total of more than 30,000 NFT-related domain names registered so far this year.

    Dofo advanced search indicated just over 9200 .com domain names including NFT were actively for sale, but this does not include the fully written out words or other forms.

    NFT Domain Name Sales

    Below are some NFT sales listed on NameBio. See the NamePros threads listed in the previous section for additional sales.
    1. NFT.com, $50,500 (2016)
    2. NFT.app, $50,000 (2021)
    3. NFTinvestments.net, $5105 (2021)
    4. BitcoinNFT.org, $5000 (2021)
    5. NFTs.net, $3488 (2021)
    6. nfter.com, $3200 (2021)
    7. NFT.info, $3023 (2021)
    8. NFTnation.com, $2500 (2021)
    9. NFTgram.com, $1951 (2021)
    10. NFTnet.com, $1088 (2021)
    Most of the sales are vert recent, the majority within the last month. The acronym NFT is selling better than the full words.

    Domain Names as Non-Fungible Assets

    As I was researching and writing this article, the thought occurred to me that domain names are in essence already the ultimate non-fungible product. Each domain name is unique with authenticated ownership, the key aspects of a non-fungible resource.

    What about viewing those who create domain names as domain artists? Might a domain name created by a highly respected domain artist, authenticated within the blockchain, add prestige to a brand?

    What else, beyond the domain name and domain artist information, could be included in the digital asset? Perhaps the story of the creation of the name - the date, inspiration and background could be included, or a personal message from the creator.

    A logo, or logo set, is another obvious included digital asset, again with information on the logo artist and an authentication guarantee.

    But the associated assets could extend beyond that. What about digital art, music clips, or video creations that would be guaranteed authentic and for use exclusively by that brand?

    While such domain name NFTs would need to be sold for higher prices, to account for the various creatives who had a role in creation of the package, major businesses might well be willing to pay that for the prestige of a professionally created domain name NFT. It would be akin to a famous architect designing your headquarters building.

    Final Thoughts

    If looking to read more, this article on Non-Fungible Token (NFT) at Investopedia gives a concise explanation that focuses on the opportunities of the technology. They summarize the advantages this way
    So what do you think?
    • Are NFTs a short-term bubble?
    • Will some make a lot of money on NFT holdings and many lose money?
    • Will we still be talking about NFTs in five years time?
    • What about DFT domain names - what sort of valuations to you see?
    • Do you think that domain names could come to be viewed as the ultimate non-fungible tokens?

    The idea for a NamePros Blog article on NFTs was suggested by @oldtimer. Thanks to NameBio and Dofo for data used for this article.
     
    Last edited: Mar 30, 2021
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  4. Bob Hawkes

    About The Author — Bob Hawkes

    Domain analyst, writer and informal educator, with particular interests in domain name phrases and non-business uses for domain names. I am a risk averse domain investor who only invests modest amounts in a variety of extensions and niches. Don't hesitate to contact me - I like to help!

    This is Bob Hawkes's 85th blog post on NamePros. View all blog posts

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  5. Comments (49)

  6. Chayan Molla

    Chayan Molla Established Member

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    Your research is always very nice. There is a lot to learn from each of your content, Thank you very much.
     
  7. The Durfer

    The Durfer Top Contributor VIP Gold Account

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  8. Paltzar

    Paltzar Hardware.company VIP

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    i was waiting for this thread
    thanks Bob
     
  9. seindouble

    seindouble Established Member ★★★★★★★★★★

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    Great write-up Bob! NFTs are probably in a short term bubble and I imagine some will do very well while others will get hurt. I suspect that NFTs will still be around in a few years but I wonder if we will call them that- or do hey just become tokens or some other name. What you bring up about domain names as NFTs is definitely an interesting topic- domains really are an invaluable asset that businesses can be built upon- so there is a lot there for potential investors to consider if they do become the ultimate NFT. As for NFT domain names- I suspect some could become brands with the 3 'NFT' letters in it (I have a few dozen) whereas many other great one word and brandable domains without the letters in it will likely become brands and do even better. The great thing about domains is that there is always new opportunity!

    Cheers,
    Mike
     
  10. TheBaldOne

    TheBaldOne Top Contributor VIP Gold Account ★★★★★★★★★★

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    @Bob Hawkes - Great intro write up IMO.

    My first real introduction to NFTs and their place in domaining, etc. was hearing Ruth McCartney talk about them on the Domain Social zoom meeting last Friday. That got me intrigued and I decided to check out availability and decided to register a single domain 'NFTcatalogs' as of course everything obvious seems to have been taken already. The thing that strikes me is the absolute market scope that NFT's offer for the future. We will see by next year how big this thing will grow and whether it is sustainable, but I remember such 'crazes' as 'Pet rocks' being sold to children. However I also acknowledge that things such as 'cards' remain highly collectable - are NFT's more gaming/sports cards than pet rocks? My gut feeling is that they are and indeed will develop, especially when mixed with other technology (which is the area I am presently looking at personally).
     
  11. J4wd

    J4wd PeerIdeas.com Gold Account

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    This is important, and according to a recent article on Vice, NFT services like Opensea are simply the ledger, they don’t actually hold the artwork itself.

    Instead, the ledger contains a link to a specific URL where the artwork resides. And while a URL doesn’t necessarily need to point to a domain, for those that do, it creates an explicit link between the NFT and the domain name. If the domain is lost or transferred, it’s possible that the NFT may be lost forever.
     
  12. marijuanadomain

    marijuanadomain Established Member

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    What next?
    I thought NFT means Non F*&^^*ing Things
     
  13. FolioTeam

    FolioTeam AMDB.tv VIP

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    Brilliant as usual. Thank you, Bob.

    Will some make a lot of money on NFT holdings and many lose money?

    Yes.
     
  14. oldtimer

    oldtimer Do some good for humanity and the environment VIP ★★★★★★★★★★

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    @Bob Hawkes

    Thanks for another great article,

    Like many others here I am just beginning to learn about NFTs, but here are a few things that come to my mind:

    1- I am hoping that NFT ends up becoming a tool that can empower the masses and give the average person an opportunity to come out of poverty as opposed to the Crypto Currencies that have been making a few lucky people richer and increasing the financial divide amongst people same as with the old money systems that they have been trying to replace.

    2 - We should not ignore the environmental impact of NFT when it comes to the huge amount of energy (mostly in the form of electric power) that is being used by BlockChains in creating and maintaining all these Tokens. We should not allow our greed and misguided interests and agendas dictate the path that these new technologies are going to take.

    Often we criticize the previous generations for not having the foresight to plan things better when the Industrial age began in the last couple of centuries or so and yet here we are again at the beginning of many new frontiers such as NFT, Automation, Space Travel, Medical and Genetic Engineering, and Quantum physics and Computing (just to mention a few) and we are for the most part letting things evolve on their own again without any planning and design that can guarantee that all these new technologies are first of all going to be used for the good of Humanity and second of all that they are not going to cause more damage to the Environment and our Home Planet (or beyond).

    3 - As far as NFT being a new bubble I believe that there are certainly some potentials here in the underlying technology and if we can find a way for NFTs to enhance and improve life for the average people (not just for the rich and the powerful) and to also make it to become more Earth and Environmental friendly then I believe that we might see some wider use for NFTs specially when it comes to such people as artists, musicians, or game developers (just to mention a few) being able to benefit more from their creativity.

    4 - When it comes to domain names everyone has to be careful not to go overboard by registering a lot of second and third tire domains as only the best of the best might see good offers. For those who are creative they might still be able to find something that stands out, but like many other trends you have to be there at the beginning in order to get the best domain names. Even though almost all viable domains that contain the word NFT are already registered but there might still be some opportunities in some domains that might be related to such categories as Art and Artwork that are seeing more action by this NFT craze.

    I had registered the domain name

    MasterpieceGalleria.com

    couple of months ago, but I just realized that it might be a perfect domain for showcasing NFT Artwork and so I made a one page placeholder website for it for now (All Rights Reserved).

    IMO
     
    Last edited: Mar 30, 2021
  15. wwwulff

    wwwulff Top Contributor VIP

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    It would have been a theft - It´s $50,500 :xf.smile:
     
    Last edited: Mar 30, 2021
  16. bbboy5

    bbboy5 Established Member

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    Thank you Bob ! Nice work as usual (y)
    Definitely NFTs will be the future, and it will be there, but only if it mingles with some more future technology, because only NFTs cant be the last technology, we will see some more technologies in times to come which will push NFTs to the next level, such as DeFi, VASPs, Mertaverse and more to come as time passes.
     
    Last edited: Mar 30, 2021
  17. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    Yes of course. Thank you. Corrected to $50,500 as shown on NameBio.
    Of course would be worth MUCH more in 2021.
    Bob
     
    Last edited: Mar 30, 2021
  18. bbboy5

    bbboy5 Established Member

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    Bob, In addition to your list. Just few days back @MetaverseBranding sold NFTtech dot com for $ 5K thru DAN.
     
  19. D Haynes

    D Haynes Top Contributor VIP

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    Think Media Options sold it very recently if I remember correctly.
     
  20. Levi_charlz

    Levi_charlz Top Contributor VIP

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    Thanks, Great article Bob!

    This subject is a such a huge area and there is so much happening right now it’s hard to keep up.

    I would just like to make a couple of comments.

    ‘An Unregulated Market’

    Regulation is coming, new FATF Guidance applies Regulatory Standards to Decentralized Exchanges, Defi and NFTs

    Any entity conducting business in the exchange of Cryptoassets, Stablecoins, NFT’s will have to adhere to FATF ‘VASP’ (Virtual Asset Service Providers) regulations.

    ‘Domain Names as Non-Fungible Assets’

    These already exist is the form of .NFT web domain extensions via the Handshake blockchain and .eth domains via the Ethereum Blockchain. (.ETH Domains are ERC721-compliant NFT’s)

    Centralised TLDs such as .com etc are not NFTs as much as legacy Domainers like to keep insinuating that they are.

    ‘Is it a bubble?’

    I very much doubt it.

    The likes of VISA and PayPal have just announced partnerships with the blockchain Ethereum which is the grand daddy of NFTs. And more will follow.

    Personally, I can’t help but think the writing is on the wall for legacy domains. At the very least they will have to give up a significant portion of the market to their decentralised counterparts.
     
  21. DOMAIN ILLUMINATI

    DOMAIN ILLUMINATI Owner of ▲ the most expensive domain of all time. VIP Gold Account

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    Thanks for this well written, compact article about NFT in context to domain names - you, Sir, are sure a "human NFT" *, to expand this term.

    * of course we (our DNAs) all are "human NFTs"

    Exactly (at least figuratively), that's why I stick to (a certain) domain name(s).
     
    Last edited: Mar 30, 2021
  22. techiese

    techiese New Member

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    most people using the term NFT have no idea what fungible actually means. Cryptoart is a better term for the movement. Ethereum is a big part of this craze. Looks like the market is catching up with the prices set for the domains listed at ethereum.properties

    btw. you may want to do a follow-up article on Namecoin and therefore BitDNS
     
  23. franka46

    franka46 Established Member

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  24. HotKey

    HotKey Made in Canada VIP

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    Thank you, awesome. This is good stuff, a layman like me can understand this NFT stuff a bit better now :)

    Find it a little ironic the domains based on legacy centralized model pushing the NFT model. But such it is, as it would be difficult for blockchain to gain critical mass without the bridge. Most current crypto domain markets are accessed via traditional means.

    Legacy looks to blockchain:
    https://cointelegraph.com/news/verisign-wins-us-patent-for-blockchain-powered-domain-names

    So who knows, in the future perhaps even .com domains could be a sort of NFT. With a yearly lease.
     
  25. radarcrypto

    radarcrypto New Member

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    Remember that Non-fungible tokens are named NFTs but also NIFTIES...
    those are the two main keywords
     
  26. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    Thank you everyone for valuable comments. I am far from an expert in this, but found it interesting to research the topic.

    Thank you very much for this important information re upcoming regulation developments.
    Yes, there are various other names that domains in this sector are using. Note that the ones I listed are just some of the ones on NameBio that include NFT/NFTs.

    I did somewhat realize this and should have noted it. My point about domains as NFTs was a little bit more than the formal blockchain connection, though. I think the critical step is for some creatives in domain naming to achieve the status of a domain name artist, so a verified link to that person brings stature and appeal to the name.

    Thanks again, everyone.

    Bob
     
  27. tourismtourism

    tourismtourism Established Member

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    I have been following NFT a long time ago, but I didn’t expect NFT to be so popular this year. I regret not having more NFT domain names early.(Google translat)
     
  28. Hankish

    Hankish Established Member

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    NFT are a use of blockchain/dis-ledgers ; part of a bigger movement.

    As to the NFT in the names; don't! Go for rare/collectibles/nifty/... unless you're selling to dev's aim for the market.

    I do foresee a Mt.Gox of NFTs comming :)

    nope,nope,nope. Trad domains still have much life left!! There is no threat. New Fad domains are very speculative but do they have any authority? What if Donuts releases a tld like your personally bought one? Or even just a carbon copy company selling the same novel-tlds? Will / Do they have browser support? I think they're cool and novel but these nascent technologies will be replaced before they even hit alpha stage. $$ in them yes, but to a small market. Still it would be nice to get ".Hank" in order to build "Hankverse" .

    Legacy is safety and enterprise relies on it.
     
  29. gilescoley

    gilescoley Top Member PRO VIP ★★★★★★★★★★

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    Great write-up as usual Bob

    This is a short term bubble. The only people that will make some $$ out of NFT domain are the people that registered the best names back in 2018/2019. The NFT artists and auction houses will be the real winners here.
     
biix
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