NFT Domains Explained: What Are NFT Domains?
There are more obstacles we will need to overcome before Web3 reaches mass adoption, but we’re still heading toward mainstream adoption of the decentralized web. So let’s discuss the matters of ownership and transferability of Web3 domains.
If you’ve been around the block, then surely you have heard about NFTs and may already have some idea NFTs are and what they do. The term NFT stands for non-fungible tokens; these tokens are unique digital assets that owners can trade with other NFT owners. Blockchain technology enables the protection, ownership and transfer of these assets.
NFT would include digital assets such as digital artwork, digital collectibles, avatars, and as well as gaming items. Unlike the traditional types of fiat currency or even cryptocurrency, NFTs are not interchangeable, and each one is unique. NFTs operate and are managed within a blockchain in a similar way to how cryptocurrencies are managed. But this new generation of assets brought along another innovation: a new generation of domains.
Here’s what you need to know about NFT domains and the best NFT domain extensions.
What Are NFT Domains?
NFT Domains are new web extensions. Unlike standard Web2 domains, NFT domains are blockchain domains. These domains are launched as smart contracts on public blockchains.
Blockchain technology is the crucial concept to grasp if you want to understand how NFTs and NFT domains work. Information is stored in a decentralized peer-to-peer network, and the storage blocks are strung together to form a chain. So it is blockchains that contain all the information, including who ows the domain and the entirety of its content.
This brings us to one of the key concepts of Web3: decentralization. The storage of the data in these domains and their associated websites is decentralized. The term refers to the transfer of control and decision-making powers from a centralized entity to a distributed network.
NFT domains are stored in their owners’ crypto wallets, much like cryptocurrencies and NFTs in general. Once an NFT domain is stored in a wallet, no third party can claim it or take it away.
How Do Web Domains Work?
Every website is assigned an IP address, which points to the location of the server where the website data is stored. A website address is actually made out of numeric numbers which make up the IP address of the site, acting as coordinates. Of course, it is next to impossible to remember complex and unique sets of numbers for each and every website, so we replace these with something that we can actually memorize: domain names. The DNS, or Domain Name System, is the traditional domain naming system.
A domain name serves the function of an address, and it makes websites much easier to track down. All domains are identified by their names which are directly associated with the online addresses of websites you are visiting. By clicking on the domain name from your browser or typing the address in the browser URL bar, you get access to that specific website.
If you are looking to register a domain name, you will need to visit a domain name registrar and purchase the domain name, and this can be done by visiting Google Domains or GoDaddy. It is important to note that whether or not you purchase a domain name, this does not automatically mean that you own that domain name; you are just purchasing the rights to use the domain name on the web. Domain registrars usually charge annual fees for users to continue using these domain names, giving users time off until when they can use the domain name, similar to a rental.
How Do NFT Domains Work?
NFT domains are upgraded or Web3 versions of domains, in that they exist on a public blockchain. These domains give users complete ownership of their stored data. NFT domains also go by crypto/blockchain/decentralized domains.
Owning an NFT domain simplifies crypto transactions greatly. Their principal function is that it replaces complex wallet addresses with a domain name. Another important function NFT domains serve is that they enable you to launch and host Web3 websites.
How to Create NFT Domain Names?
When it comes to the process of registration of an NFT domain name, it is worth noting that NFT domains cannot be registered through registrars like classic domains. But the registration process is not that different, as you do need to type your desired domain name into the search bar to see if the name is available and whether the pricetag is acceptable.
Not surprisingly, NFT domains are often traded on NFT marketplaces and bought using cryptocurrencies. After you choose and purchase a domain, you need to verify and choose your wallet (one that is supported by the domain provider). Your domain will then be minted and stored in your wallet.
The name itself is up to you, but it is the extension that is an NFT domain’s key selling point.
It is important to note that NFT domain names have different TLDs or top-level domains, which vary in terms of pricing. If you buy an NFT token that belongs to a specific domain, it carries its extension.
This brings us to the topic of the best NFT domain extensions. At this point, it makes sense to take the time to browse the most popular NFT domain extensions from reputable companies.
So what are top blockchain domains? The most prestigious and, by extension, the most expensive examples of NFT domains to register are .crypto, .nft, and .wallet.
The downside of NFT domain names is that domain extensions may look less professional when compared to the Web2 ones that we’re accustomed to.
Can You Use an NFT Domain as a Website?
Yes, an NFT domain gives you independence from Web 2.0 internet. Not only can you host a website but also access DApps using your NFT domain name.
A potential issue you will encounter is that search engines do not index NFT domains. This can be problematic for local businesses. Another potential issue is that not all browsers support Web3 domains. At the moment, only Brave and Opera have the functionality needed to properly display websites with NFT domains.
The Differences Between NFT Domains
Now that you are aware of how NFT domain names work, how exactly are NFT domains different? People may view NFTs online, but the rights and ownership over a particular NFT, as well as the original copy and certification of authenticity, belong to the owner. The difference between NFT domains a traditional domain is that when you purchase an NFT, you will be getting the NFT completely, and that includes their domain name, unlike buying a traditional domain that has a rent-like setup that other people can exploit. Unlike the traditional web that most people are used to, NFT domains are decentralized, and their control of the domain name and ownership belongs to who bought and owned the specific NFT.
Exploring NFT Domains
NFTs need a wallet where they can be stored. NFT domains, aside from being a website address, can also be a wallet for your cryptocurrency to be stored in.
As a new generation of domains, NFT domains can either act as a website that you would be able to place content in similar to a traditional domain name as well as act as a cryptocurrency wallet that allows users to use the same domain name that is able to send and receive cryptocurrencies that it is compatible with.
How To Buy an NFT Domain
Ready to buy an NFT domain? All in all, NFT domains are decentralized and perfect for trading cryptocurrencies. Just follow these steps to ensure a seamless purchase process:
1. Look For a Legal NFT Market
This one will be tricky. Choosing the right market to ensure that the NFT domain you purchase is legal will be risky. Some will use this to scam people with how the internet is built. Make sure to choose an NFT Domain for sale that is trusted, and the price of it is appropriate for what it is. OpenSea, Raible, and SuperRare are the most famous NFT marketplace. Along with these are the 14 other markets [https://influencermarketinghub.com/nft-marketplace/] you can choose to buy from.
2. Prepare an E-Wallet
Since NFT domains are digital, so is the money you will use to purchase them. Make sure you prepare enough money. What type of digital money will depend on the marketplace you are in. For example, it could be bitcoin, cryptocurrency, litecoin, ripple, or others. Make sure to transfer enough money from your own digital wallet to the digital wallet deemed requested by the market. Sometimes, markets create their own wallet. All you have to do is transfer money in there.
3. Search for the NFT Domain You Want
Once everything is set up, you can search for what specific NFT domain you want to purchase. Just use the NFT marketplace search engine and apply some search filters to narrow done the specific NFT item you want to purchase. Search for domain names and check the domain file extension. Each extension has a varying price.
4. Finalize Your Purchase
Double-check the NFT item that you put in your cart. Once you’ve finalized which domain you want, click the purchase button. Also, check if the NFT domain is listed as an auction. Some are listed as one; you must fight your way if you wish to buy them.
5. Confirm Your Payment
Once you’ve purchased it, make sure to confirm your Payment. Some forget to do this. If you do not confirm your Payment, chances are you will not have the domain you want.
6. NFT Minting Process
Now that you have successfully purchased the domain, you have to make sure to create a public record of your ownership. This certifies that the domain has already been purchased and is owned by you. The process is called minting.
What Is the Use of an NFT Domain?
You might be wondering why you should even bother buying an NFT domain.
There are a lot of compelling reasons to do so, for instance:
- No rental or renewal fees. Once you purchase it, it will be all yours, and you don’t need to worry about periodic fees.
- Simplicity and accessibility. Using cryptocurrency is not as user-friendly as we’d like it to be, at least not yet. An NFT domain can help you ease your transaction. Besides. NFT domains also support and accept a rich diversity of tokens and currencies, which translates into quick and easy digital transactions.
- Decentralization and more power to you without the risks of censorship. Unlike traditional domain, which has one sole governing authority, an NFT domain under your ownership is decentralized and can be controlled by you and you alone. And this self-custody is yours for life.
- Affordability. Although the price between different NFT domains varies depending on the file extension you opt for, when compared to traditional domains, it is still more cost-effective.
If impulse buys are your pet peeve, make sure to think it through before you go ahead with the purchase, but remember this: you’ll always have the option to resell your domain. Even if you’re not entirely sure you will make use of it yourself, purchasing an NFT domain can be a clever investment down the line, as Web3 continues to gain wider acceptance, grow, and evolve.