Web 3.0 Domains: Innovation or Illusion?

The idea of owning a domain name that lives forever on the blockchain sounds like something from the future.

On the surface, it's a tough argument to beat. After all, a domain that not only lives forever, but promises digital independence, censorship resistance, and total control is something every business owner would want. Wouldn't they? I mean, what's not to like? Setting up your virtual store or web front with the freedom of being able to do whatever you need to attract and retain customers without having to obey the rules or follow federal guidelines would surely mean that anything would be acceptable, if you're willing to win, right? And as every business owner will tell you, those golden arches of McDonald's didn't get where they are today by being kind. No, Sir. It's do or die. Fight to survive or give up and fold.

You Can't Sell What You Don't Need

A new web frontier would be like those early years of the internet over thirty years ago, only now, we would all be empowered with the knowledge of what it takes to succeed. No more learning the hard way. Just taking what we know and using it to our advantage on a new platform. The blockchain. This mystical, impenetrable fortress that they call Web 3.0. The new improved web.

The funny thing is, when you write about, or present Web 3.0 in this way, it sounds almost too good to be true, mainly because you want to believe it yourself. You begin to imagine what this utopian internet might be like, could become, if only we would all "fight the power", rebel, revolt, and join the revolution.

Hit Them Where It Hurts

When Web 3.0 domains first emerged they did so using language and sales arguments that were specifically targeted towards users who were tired of centralised systems and renewal fees. It wasn't a marketing ploy developed by chance. It was a carefully developed sales pitch that made perfect sense. It struck right at the heart of every domain owner's biggest gripe: the greed of registrars and the annual increase of domain renewal fees.

But who are these unhappy domain owners? Well, basically, everyone...

At the time of writing, there are approximately three-hundred and sixty eight million domains registered worldwide. That's one domain name registration for every twenty or so people on the planet. In fact, apart from motor vehicles and cell phones, it's hard to think of anything else that has that kind of volume, especially when you also remember that in "owning" a web domain, you are in reality only continuing to own it in so long as you pay a fee every year in order to be able to continue using it.

Hang on a minute, that's not ownership, is it?

You Say Tomato, I Say Tomato

The Cambridge English Dictionary defines ownership as: the state or fact of owning something. Which on the surface, feels kind of vague. But at the same time, when you buy a car or phone, the minute you complete your final down payment, it's yours. That's it. No one can take it away, unless of course you use it as collateral for another purchase. Anyway, the point is, how can you "own" a domain if the moment you stop paying to renew it, someone else is able to take it from you? Surely that ability negates the entire concept of ownership?

The problem is, that when you "buy a domain" you pay a registration fee, and for some reason, that fee increases every year, So, unlike buying a car, it feels more like getting the first month's rent at a discount, only to end up paying an ever-increasing rental payment in order to continue using the address for a place you like to call home.

With this form of "ownership," it's easy to see why domain owners were more than ready for a new norm in domain registration, and a way to break this cycle and a system which, let's face it, can feel more like a tenant being held hostage by a greedy landlord rather than an owner having actual ownership.

Ready And Willing

There's no denying that the concept of Web 3.0 is interesting.

If we cut through the semantics and definitions of what domain ownership really entails, then it might be fairer to say that traditional domains are leased through registrars under ICANN, renewed annually, and regulated by global agreements.

The case for Web 3.0 is that blockchain domains don't simply change that model, they flip it on its head.

You buy a name once, store it in your crypto wallet, and it becomes permanently attached to your blockchain identity, which means it can't be suspended or taken down.

To many, that sounds like freedom, and the same kind of pioneering spirit that built the web over three decades ago, before the corporations took over. To others, perhaps those more sceptical and those who know that Big Macs aren't going anywhere, it sounds like chaos waiting to happen.

Innovate Or...

When people talk about innovation in the domain space, they usually mean the idea of decentralised ownership. Now, as an idea, it certainly has merit and is well worth exploring, after all, imagine the ability to prove and transfer ownership without intermediaries. Even car owners can't do that. So, there is real merit in the idea, but ideas and reality rarely match, and if they should in this case, we really need to look a little closer at the mechanics of it all.

Smart contracts can automate sales and transfers, and the blockchain provides a transparent record. Those are genuine technical advances. But innovation isn't just about what's possible, it's also, and arguably more importantly, about what's useful.

Think back to the days before Google, when Alta Vista reigned supreme. While Alta Vista simply matched keywords in search phrases, Google innovated with algorithms that generated results based upon numerous factors including quality and relevance. In other words, it helped users find what they were looking for faster, and more accurately, so that it quickly became their number one choice for search. The cell phone made communications mobile and affordable, so much so that the idea of a landline became absurd, because why should anyone need to be fixed to a room in order to call or speak with someone?

Innovation that uses technology to improve or simplify a task is one that we can quickly embrace and adopt. Sadly, in the case of blockchain domains, it is here where Web 3.0 not only loses its shine, but rather, becomes somewhat dull.

Know Your Limits

The promise of decentralisation quickly runs into practical limits.

A blockchain address like "example.crypto" doesn't live in the global Domain Name System (DNS). It simply can't be resolved by default in Chrome, Safari, or Edge. It requires a plug-in, a specific browser, or a gateway service to function. That might be fine for crypto enthusiasts, but for anyone building a business or brand, that's more than a serious handicap. That's like trying to start a courier service today using a horse and cart. There's no point promising fast delivery if it takes a month for the horse to reach you, and you can't reach people if they can't find you.

Then there's the question of integration.

A .com domain plugs into everything. From email, hosting, analytics, SEO, and security. Anything online knows and recognises what a .com is and how to use it. A blockchain domain, on the other hand, lives in its own ecosystem. It doesn't support traditional email systems, standard SSL certificates, or search engine indexing. In other words, it exists outside of and apart from the internet that most people use. That's not innovation, let's call it for what it is: isolation. And good luck building a business or brand like that.

Censorship From Who, Exactly?

Supporters argue that Web 3.0 domains offer censorship resistance and provide permanent ownership. I have to say, I couldn't disagree more.

You see, permanence cuts both ways. If you lose the private key that controls your blockchain wallet, your domain is gone for good. If someone steals it, it's gone, for good. There's no recovery. There's no appeal. There's no way to find it. No way to reclaim it. Nothing. It's simply gone, and gone forever.

Now, if you take that point alone and examine the potential consequences of it, then it also means that there's no dispute resolution process. No ICANN. No UDRP. No legal framework. There's nothing. That might sound cool and rebellious, but in a world where digital theft and scams are increasingly common, "complete control" can just as easily turn into "complete loss."

The Future Of Finance And Identity

Another selling point of Web 3.0 is the claim that these domains can also act as digital identities. That one address can represent you across apps, wallets, and smart contracts. A sort of "Digital Me."

Again, it's a neat concept, but it's one that depends entirely upon widespread adoption of platforms that recognise and support that system. Without this, it's just another "proprietary" system trying to do something that can already be done, albeit by having to do it with several different unrelated platforms. The problem for Web 3.0 is that right now, the adoption it needs to function as a digital Id, simply isn’t there. Outside a small crypto audience, the technology is invisible, so it's a bit like buying a car that can only drive on a single private road.

The same goes for the financial argument, despite it being that one that is constantly flaunted.

Almost every blockchain domain is marketed as a "one-time purchase," and it is, without question, the single strongest argument out there for Web 3.0.

Imagine, finally being able to own a domain and to do so by paying for it only once. It's a great deal compared to the annual renewals. But those fees exist for a reason. They fund the infrastructure, security, and coordination that keep the internet reliable.

Whether we like it or not, without that structure, you'd be left with an unregulated market where prices are set by the companies running the blockchains, and in that world, disputes are settled by whoever holds the keys, and that's not you, even if you're being told that you do. You may hold a copy of a smart contract, but it's a copy. The people "selling" you the domain hold the contract, and what happens if anything should happen to them?

The Emperor's New Clothes

In my opinion, and it is only my opinion, but if we strip away the marketing, Web 3.0 domains look less like a revolution and more like a niche experiment.

The innovation of Web 3.0 is not in how the domains are used, but in how they're sold.

For me, this is something else entirely, and it's not how they're marketed, and that's a fact.

By framing ownership as "liberation from registrars," the individuals and companies promoting blockchain domains have simply turned digital naming into another speculative asset class, just as they did with non-fungible tokens (NFT's) and digital artwork ownership.

People aren't building websites on Web 3.0 domains, they're simply buying ones to flip them as quickly as possible for as much as possible before the curtain comes down, much like early NFT trading. So, let's be honest. The value isn't tied to use, but to hype. Remember how people were buying JPGs for hundreds of thousands, and even millions of dollars? Images that you could find just as easily on Google Image Search. Their argument for paying huge sums for these files was that they alone now owned the original JPG file, and had a blockchain record to prove it. Seems no one told that to my browser's cache which is apparently full of millions of dollars of artwork, so perhaps I should upgrade my office insurance?

Progress By Another Name

With all that is currently wrong with Web 3.0 domains, or rather, limited by its shortcomings, it doesn't mean the idea itself should be dismissed entirely.

The blockchain has real potential to improve certain parts of the internet, especially around verification and trust. This I do, and strongly believe to be true. There may well come a time when blockchain-based identifiers coexist with traditional domains, offering secure links to digital credentials or decentralised identities. It's certainly not impossible. However, for now at least, those possibilities remain theoretical, because what’s being sold today as "Web 3.0" is still an incomplete prototype, not a practical replacement for the DNS that powers everything from our banking services to email.

The real potential for innovation, when it comes to the internet, doesn't lie in what doesn't exist, but in what we already have: an open, resilient, and decentralised web built on shared standards.

No one owns the internet. No one. And that's a pretty cool thing.

The DNS works because millions of systems cooperate with each other, not because one blockchain dictates the rules. It's that balance of structure and freedom that makes it robust. We should remember that.

Blockchain domains, for all their ambition, risk breaking that balance by creating isolated networks that they want to call progress. But is it?

I guess ultimately, the whole point of this three-part series on Web 3.0 domains has been centred around the value of blockchain domains and if that value is innovative or merely an illusion?

The honest answer is probably a bit of both.

The underlying technology of Web 3.0 is fascinating, and it might one day lead to invaluable tools for identity or authentication. But as a replacement for domain names, or a way to be found, trusted, and connected online, they fall desperately short.

For now, Web 3.0 domains remain a reminder that innovation isn't just about doing something new, it's about doing something that works, and until those behind the hype accept and realise that, Web 3.0 will always remain, and be stigmatised as a platform that simply tries to finds ways to take the things we already have access to, and repackage them as something other than what they really are. Inferior, not better alternatives.

No matter how hard you try, a JPG image will never replace the finesse of a physical canvas, no more than a .eth domain can ever replace a .com, and the sooner we get past the speculation, the closer we will finally be to discovering just how innovative Web 3.0 is as a technology, and can actually become in its use.