- Namecoin issues new coins to miners as a reward for performing merged mining with the Bitcoin network. The namecoin supply is being inflated at nearly 30% per year for several more months, then over 10% for the next several years. Domainshares only ever shrink in supply, when fees are destroyed as implicit dividends.
- Namecoin attempts to service multiple namespaces at once. .p2p is highly specialized for servicing the .p2p TLD namespace. The use case is the same as Namecoin's "d/" namespace, which is used for the .bit TLD.
- Namecoin's name registration price is fixed at any given time and is independent of the name itself. Domainshares utilizes an auction-like mechanic to incentivize price discovery for names, making sure the final owner pays what it is actually worth. The majority of the final cost will have gone to the network as dividends by the time the auction is over, with a small fraction having gone to bidders as a reward for price discovery.
- As a result of the fact that domains are expensive and there are dividends on shares but not domains, there is a high opportunity cost to squatting: holding a domain without making good use of it.
We are still working on the exact mechanics (open to suggestions!), but the simple first model is:
- The price starts at 0 and people bid it up to the market value
- If someone makes a bid B1, then someone makes a next bid B2 = B1 + D, then person 1 receives (B1 + D/2) and the remaining D/2 gets paid as fees to network (and thus become shareholder dividends)
- This incentivizes people to bid up the price to what they consider the market value, because of the extra portion they receive when they are outbid
- This also disincentivizes squatting because you will pay more for buying and selling the domain than you would have received as network dividends had someone else just bought the domain
So if I buy a cheap unused nonsense word domain (say wikipedia.org) and turn it into a valuable domain by making a popular website many people visit and link to, 'the network' gets to shake me down because wikipedia.org is worth $20,000,000 now instead of the $20 I paid for it?
And as an end user, I don't know if visiting or e-mailing wikipedia.org will take me to an encyclopedia or a cybersquatter or a porn site?
Who exactly benefits from this system, except for 'the network'?
Not sure what you mean exactly but it works like that :
Once you buy your domain at 20$ is is yours and you do whatever you want with it. The bidding auction applies only the first time you buy it nobody can touch your domain name one you purchased it.
Whitepaper and FAQ are not quite up to date but you get the idea. From: https://github.com/nmushegian/dns/blob/master/whitepaper.md#...
- Namecoin issues new coins to miners as a reward for performing merged mining with the Bitcoin network. The namecoin supply is being inflated at nearly 30% per year for several more months, then over 10% for the next several years. Domainshares only ever shrink in supply, when fees are destroyed as implicit dividends.
- Namecoin attempts to service multiple namespaces at once. .p2p is highly specialized for servicing the .p2p TLD namespace. The use case is the same as Namecoin's "d/" namespace, which is used for the .bit TLD.
- Namecoin's name registration price is fixed at any given time and is independent of the name itself. Domainshares utilizes an auction-like mechanic to incentivize price discovery for names, making sure the final owner pays what it is actually worth. The majority of the final cost will have gone to the network as dividends by the time the auction is over, with a small fraction having gone to bidders as a reward for price discovery.
- As a result of the fact that domains are expensive and there are dividends on shares but not domains, there is a high opportunity cost to squatting: holding a domain without making good use of it.