While Bitcoin Soared, Crypto Domain Names Served Up Prime Online Real Estate In 2017

&l;p&g;&l;img class=&q;dam-image shutterstock size-large wp-image-783415252&q; src=&q;https://specials-images.forbesimg.com/dam/imageserve/783415252/960×0.jpg?fit=scale&q; data-height=&q;639&q; data-width=&q;960&q;&g; Shutterstock

Dubai resident&a;nbsp;Sharjil Saleem&a;nbsp;of&a;nbsp;&l;a href=&q;https://www.aeserver.com/&q; target=&q;_blank&q;&g;AEServer&l;/a&g; makes a living investing in domain names and brokering domain name deals, several of which have been valued as high as six figures. In October, he brokered a $2 million&a;nbsp;deal for the sale of domain ETH.com –&a;nbsp;100 times the $19,800 he originally paid for the website name back in 2008.

There was crypto mania behind the domain&a;rsquo;s crazy price appreciation. ETH is the ticker symbol for Ether, currently the third-largest cryptocurrency with a market capitalization of more than $85 billion.

And the mania has hit the domain game at full force. &a;ldquo;Crypto is currently the hottest trend in the domain name industry,&a;rdquo; says Saleem, whose network of buyers stems largely from China and the U.S. &l;a href=&q;https://www.godaddy.com/&q; target=&q;_blank&q;&g;GoDaddy&l;/a&g;, the world&a;rsquo;s largest domain name registrar, has data to back that assertion up. In 2017, the firm saw more than six times as many new domain name registrations with cryptocurrency-related words than in 2016. The average sale price for domains including &q;coin&q; has jumped by nearly 600% since 2011 (a couple of years after Bitcoin&a;rsquo;s release) — with the average sale price currently being about $187.

Meanwhile, domains registered with the term Bitcoin increased four-fold in just one year. And as Bitcoin&a;rsquo;s share of the cryptocurrency market reaches all-time lows due to the fairly recent rise of alt-coins, the average price for &a;ldquo;crypto&a;rdquo; domains has increased about 740% since 2011; such domains now fetch an average price of $323,&a;nbsp;per the GoDaddy data.

&a;ldquo;Domain name registrations are generally indicators of interest in a topic and people believing that businesses can be built in that space,&a;rdquo; says Paul Nicks, GoDaddy vice president for the domain name aftermarket. &q;Historically, when a sustained trend emerges, we see an increased level of domain registrations for the event.&a;rdquo;

Aggregate price data for token-specific monikers&a;nbsp;weren&s;t included, but &l;em&g;Bloomberg&l;/em&g; &l;a href=&q;https://www.bloomberg.com/news/articles/2017-11-14/ethereum-com-domain-name-can-be-yours-for-about-10-million&q; target=&q;_blank&q;&g;reported&l;/a&g;&a;nbsp;in November that Ethereum.com was on the market for $10 million. And Saleem&a;rsquo;s $2 million deal for the still-inactive ETH.com was the second-highest domain name transaction last year, according to &l;em&g;Domain Name Journal&l;/em&g;, which tracks &l;a href=&q;https://www.dnjournal.com/ytd-sales-charts.htm&q; target=&q;_blank&q;&g;the year&a;rsquo;s highest-reported domain sales&l;/a&g; on a weekly basis. The top seller last year,&a;nbsp;with a sale price of $2.9 million, was fly.com, which fittingly&a;nbsp;reflects the largely generic terms that usually encompass the&a;nbsp;highest-priced&a;nbsp;domain names.&l;!–nextpage–&g;

In 2017, Saleem also found buyers for asset.com (at $406,000) and j5.com ($115,000). He recently put LTC.com up for sale, which matches the ticker for Litecoin, another cryptocurrency — this one with a $14 billion market cap. Other crypto-related domains in his portfolio include eBitcoins.com and currencyconverter.com.

Saleem says new technology sometimes makes domain names more valuable — as has been the case with other recently value-injected domain names. GoDaddy provided data showing similar fluctuations in the average sale price for domains dealing with VR and 3D. Domains including &q;VR&q; showed a 53% increase in price since 2011, but that&s;s including a steep drop&a;nbsp;in 2016 — when the average sale price (now at $62.20) was nearly $150. Similarly, the price of &q;3D&q; domains peaked in 2013 before settling into more modest gains.

When it comes to the correlation in prices between cryptocurrencies and their related domains, Nicks says that anecdotally, interest in coin-related domains fluctuates in tandem with the price cycle and news cycle around the currency.

Ecommerce giant Amazon was perhaps the biggest name to fuel the crypto-domain conversation in 2017, after it was &l;a href=&q;https://www.cnbc.com/2017/11/01/amazon-buys-crypto-domains-bitcoin-ethereum.html&q; target=&q;_blank&q;&g;revealed in November&l;/a&g; that the tech darling had registered several crypto-related domain names, including amazonethereum.com and amazoncryptocurrency.com. Many, however, have speculated that rather than signaling a move into the space, the registrations could simply be a form of brand protection.

&a;ldquo;As various forms of cryptocurrency increase in popularity, we&a;rsquo;ll see more people and businesses try and find ways to leverage that popularity in different ways,&a;rdquo; Nicks says. &a;ldquo;Smart investors should keep an eye out for emerging types of cryptocurrencies, or terms within the industry (i.e. wallet) as there could be opportunities to invest in names related to those new developments.&a;rdquo;&l;/p&g;

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