Cryptoverse: Swapping Names In A Mind-Blowing Crypto Craze

Oct 4 (Reuters) – A new NFT trading craze where names are bought and sold for sky-high sums is providing a multimillion-dollar lifeline to speculators cowering in the grim crypto winter.

“Domain” names such as coin.crypto (which sold for $100,000) and beer.eth (which made $39,000) are a new generation of NFTs that owners can use to replace the clutter of 16 random numbers and letters that form their digital wallet. addresses.

That might seem like a lot of money for the crypto equivalent of a personalized car plate, but backers say those names could become valuable real estate in years to come with the advent of Web3, a very vision hype of a future Internet built on blockchain.

– Advertising –

Join now for FREE unlimited access to

Currently, the market for trading these alternative assets offers rich – and risky – choices for some investors who pick up hot domains with the aim of flipping them for a profit in the secondary market on NFT platforms like OpenSea. .

“We have domain names starting as low as $5, some have sold for up to $100,000,” said Matthew Gould, CEO of Unstoppable Domains, which sells names ending in .crypto, .nft, and . wallet on its website.

“The range is because there is a definite perceived value difference between different words and lengths.”

The company has recently seen exceptional offers: for example, wallet.crypto sold for $250,000 and Earn.crypto sold for $100,000, both in April.

Meanwhile, .eth names generated by Ethereum Name Service (ENS), the biggest domain seller, were the fourth most traded NFT type on OpenSea in September, with total volumes up 75% from a month ago to reach the equivalent of $12.5 million. .

ENS domain names were topped only with NFTs (non-fungible tokens) from well-known collections such as CryptoPunks and Bored Ape Yacht Club. Trading in relatively new assets has grown rapidly even as the crypto winter hit the NFT market.

Monthly registrations for .eth domain names jumped to more than 433,000 in September, the highest in 12 months and a 5,000% increase from a year ago, according to Dune Analytics.

The domain names that command the highest value are often those with simple, short English words, terms referring to pop culture or Web3, and number sequences, experts say, like crypto.nft or 000 .eth.

Reuters Charts


However, crypto domains are still in their infancy. There is no guarantee that they, or Web3, will deliver on their promise, while the highly volatile nature of the cryptocurrency and NFT markets suggests perils for the unschooled trader.

Questions also abound about the scalability of the technology and the potential for confusion as competing domain providers issue similar names, which could lead to funds being misdirected, according to a report by Block Intelligence.

Sasha Fleyshman, portfolio manager at investment firm Arca in Los Angeles, said domain names are likely to grow in popularity as crypto becomes more mainstream.

The 16-character alphanumeric addresses used for digital wallets “are not exactly customer-friendly, especially for non-crypto natives,” he added.

In a sign of investor confidence in the growth in value of digital assets tied to .eth domain names, the ENS Project’s crypto token soared nearly 90% in the third quarter to $15.92 — although it is still far from the $40 it was trading at the start of the year. Bitcoin ended the quarter virtually flat, struggling to stay above $20,000.

Yet many market participants warn that valuing a domain name is difficult because it is a speculative bet on what might be in demand in the future.

This weakens the case for institutional investing, Fleyshman said.

“From a fund perspective, it is rather difficult to make a fundamental investment in specific domain names,” he added. “It’s just not our wheelhouse to say which areas will gain value and which won’t.”

(1 ether = $1,330.20)

Join now for FREE unlimited access to

Reporting by Medha Singh and Lisa Pauline Mattackal in Bengaluru; Editing by Tom Wilson and Pravin Char

Our standards: The Thomson Reuters Trust Principles.

We would love to say thanks to the author of this article for this incredible material

Cryptoverse: Swapping Names In A Mind-Blowing Crypto Craze

You can find our social media profiles here , as well as other pages on related topics here.