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08/22/2024

Decentralized Domains Could Bring the Next "Billion Users" to Bitcoin

As centralized domain incidents expose security vulnerabilities, one executive argues that decentralizing domain names on the Bitcoin network would be a far better alternative. Mike Carson, founder of the Bitcoin-based naming project Spaces Protocol, says people currently rely on trusted third parties for their usernames and domain names. However, an incident involving DeFi protocols that depended on Squarespace's registrar system

Decentralized Domains Could Bring the Next "Billion Users" to Bitcoin

As centralized domain incidents expose security vulnerabilities, one executive argues that decentralizing domain names on the Bitcoin network would be a far better alternative.

Mike Carson, founder of the Bitcoin-based naming project Spaces Protocol, says people currently rely on trusted third parties for their usernames and domain names. However, an incident involving decentralized finance (DeFi) protocols that depended on Squarespace's registrar system exposed deep flaws in the current structure.

On July 11, an attack on Squarespace's DNS system affected more than 100 crypto projects. The vulnerability put the DeFi space at risk of phishing attacks, resulting in financial losses.

Carson believes the incident underscores the need for decentralized domain names, and argues they should be anchored to Bitcoin — the most secure and decentralized blockchain in existence.

Domain names are digital assets that should be stored on a blockchain

Carson, founder of domain backorder service Park.io and co-founder of software company Wizehive, told Cointelegraph that domain names should be stored on a blockchain. After years of working with domain registrars, he came to realize that domains need to be decentralized. He explained:

"When I owned and managed three ICANN-accredited registrars and worked with various registry systems and registry operators, I realized that domain names are digital assets and should be managed on a blockchain — not by trusted, centralized third parties."

Carson also drew a parallel between domain registrars, banks, and Bitcoin (BTC). He argued that people shouldn't have to depend on a third party to safeguard their domain names. "Why do we need permission to use our own money or our own name?" he asked.

Carson also pointed to other government censorship incidents that have highlighted the importance of having decentralized domain names. In 2017, the Spanish government raided the offices of DotCat (.cat) because they were promoting Catalan independence.

He also cited the blocking of high-profile social media accounts as further evidence of why decentralized usernames and domain names matter.

Domain names should be anchored to Bitcoin

Carson, who has also contributed core code to Ethereum Name Service (ENS) and Handshake (HNS), argues that Bitcoin is the best home for domain names. He called it critically important and said it feels inevitable. Carson explained:

"Bitcoin is clearly the most secure and decentralized proof-of-work blockchain. It makes perfect sense that decentralized domain names should be anchored to the Bitcoin block space."

He said they built Spaces Protocol on Bitcoin with exactly this in mind. Carson added that the protocol was built around "cypherpunk" ideals. "No separate token, no premining, and no treasury. No changes to the Bitcoin protocol required," he added.

Carson said they built Spaces to scale to billions of domain names while leaving only a minimal footprint on Bitcoin block space. He added:

"I believe decentralized domain names could bring the next billion users to Bitcoin. There are hundreds of millions of domain names, and social media companies have billions of users."

The domain expert also argued that if anything rivals money in importance to society, it's naming. "Block space on the Bitcoin blockchain is valuable because it's the most secure and decentralized ledger available. The first killer app built to use it was Bitcoin as money. Naming will be next."