Web3 naming companies face steep challenges in new TLD round

Web3 naming services have spent years promising a new internet naming layer, unconstrained by governments and legacy institutions. Now they're lining up for ICANN's next TLD round.

That move is an admission: the blockchain didn't replace the DNS. It just built a parallel system that needs a bridge to the real world to matter.

The steepest challenge isn't the application fee. It's the political and legal stack that comes with a domain. ICANN requires stability, accountability, and a dispute resolution process. Those are exactly the things a decentralized namespace does badly.

• Ownership semantics: A private key isn't a trademark. ICANN's evaluation and UDRP process will treat 'ownership' as a legal claim, not cryptographic custody. That mismatch is fundamental.

• Security and routing: Operating a TLD means meeting technical requirements like DNSSEC and 24/7 critical infrastructure standards. Web3 infrastructure, with its reliance on smart contracts and on-chain governance, isn't built for those uptime promises.

• The real negotiation: Web3 names want the root zone's trust, but they don't want to give anything to the root's master. ICANN's process only works if you accept its jurisdiction. That's the price of entry, and it's steep.

Expect some applicants to position themselves as 'bridges' that resolve web3 names via DNS without actually operating a TLD. That's the lighter touch that preserves their worldview, and it's what ICANN is less eager to bless.

In the end, the new round will separate the purity projects from the pragmatists. The ones that win TLDs won't be the most decentralized; they'll be the ones that convincingly fake the old world's paperwork.