The world of Web3 is rapidly evolving, and at the forefront of this transformation are decentralized domain services like Ethereum Name Service (ENS), Space ID (.bnb), and .bit. What started as a simple solution to replace long, complex blockchain addresses has now evolved into a foundational layer for digital identity in the decentralized internet. But beyond just simplifying wallet addresses, what real value do these Web3 domains offer?
From branding tools to social identifiers and even the backbone of future decentralized identity (DID) systems, Web3 domain services are redefining how users interact with blockchain ecosystems.
The Explosive Growth of ENS and the Web3 Domain Boom
Few expected that a utility-focused project like ENS would become one of the hottest trends in crypto. Yet, since early 2022, ENS has seen unprecedented adoption. From April onward, registration surged — especially for short, memorable names like 123.eth or abc.eth — turning domain acquisition into a speculative and strategic endeavor.
Financial metrics reflect this surge:
- ENS has generated approximately $61.5 million in total protocol revenue since inception.
- Remarkably, about 75% of that income — nearly $46 million — was earned in 2022 alone.
- In May 2022, ENS earned $9.56 million from new registrations and renewals, making it the highest-earning decentralized protocol that month.
While activity dipped slightly in June and July, momentum returned strongly by August:
- Over 300,000 new domains were registered in August, bringing the total to 2.17 million.
- Protocol revenue reached $4.7 million in August.
- By mid-September, already $2.32 million had been generated — suggesting another record-breaking month ahead.
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This isn't just an ENS phenomenon. Other blockchain-based naming systems are gaining traction:
- Space ID, powered by BNB Chain, raised seed funding and saw massive community demand, prompting delays in phased .bnb domain rollouts due to overwhelming feedback.
- Average registration cost? Just 0.0418 BNB, making it highly accessible.
- .bit (formerly DAS) on Nervos Network reported over 138,000 cumulative accounts and 48,000 unique registrants, with daily sign-ups hitting all-time highs.
Clearly, the market sees more than vanity in these domains.
Web3 Domains as Digital Business Cards and Branding Tools
At their most basic level, Web3 domain services function like the “.com” of the decentralized web — but with far greater utility.
For Projects and Brands
Just as companies secure their brand names online, blockchain projects now routinely register matching ENS domains:
- Project Galaxy rebranded to Galxe — likely after securing galxe.eth.
Even traditional Web2 brands are joining in:
- Budweiser bought beer.eth for 30 ETH.
- Gucci secured gucci.eth for 12 ETH.
- Tiffany & Co. purchased tiffany.eth for 29 ETH.
These aren’t just marketing stunts — they signal a shift toward recognizing blockchain identities as legitimate extensions of corporate digital presence.
For Individuals
For users, owning a domain like terry.eth transforms how they present themselves across Web3 platforms. Instead of sharing a string like 0x71C...aB3f, you simply share your human-readable name.
More importantly, ENS allows users to:
- Set custom avatars (often NFTs)
- Link multiple cryptocurrency addresses (BTC, ETH, LTC, DOGE)
- Attach social profiles (Twitter, GitHub, Reddit, Telegram)
- Include email and personal websites
In essence, your ENS becomes your on-chain business card — persistent, portable, and under your full control.
Vitalik Buterin uses vitalik.eth; core Ethereum developer Tim Beiko goes by terence.eth. These aren’t just usernames — they’re verifiable digital identities.
And like premium phone numbers or rare license plates, short or meaningful names (e.g., 123.eth) have become collectibles — fueling both utility and speculation.
The Bigger Vision: Web3 Domains as Decentralized Identity (DID) Infrastructure
While branding and personalization are compelling use cases, the true potential of ENS, .bit, and Space ID lies in their evolution into full-fledged decentralized identity (DID) systems.
Why DID Matters
In today’s internet (Web2), your identity is fragmented and controlled by corporations:
- Google owns your Gmail profile.
- Meta controls your Facebook data.
- Amazon tracks your behavior across services.
You don’t own your data — and worse, you don’t benefit when it’s monetized.
Decentralized Identity flips this model:
DID puts individuals back in control of their digital selves — using blockchain technology to create self-sovereign identities that no central authority can censor or revoke.
Projects like ENS and .bit are becoming key enablers of this vision.
How Web3 Domains Power DID
Once you register an ENS or .bit domain:
- You gain full ownership via private keys.
- You can bind multiple wallets across chains (Bitcoin, Ethereum, etc.) to one identity.
- You can attach verified information: socials, credentials, preferences.
- You can control visibility: choose what to reveal and when.
This means instead of logging into every app with a new account, you could use your terry.bit or terry.eth as a universal login — similar to “Sign in with Google,” but without surrendering data.
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Cross-Chain Identity and Interoperability
One of the biggest hurdles in Web3 is fragmentation. Your Ethereum wallet doesn’t talk to your Solana wallet. Your NFTs live in silos.
But with a DID anchored to a Web3 domain:
- All your addresses become part of a single identity graph.
- Apps can recognize you across chains.
- Reputation and history travel with you — not trapped in isolated ecosystems.
This paves the way for cross-chain credit scoring, where your transaction history, NFT ownership, governance participation, and even off-chain behaviors contribute to a decentralized reputation system — think “on-chain credit score” or “Web3芝麻信用.”
Frequently Asked Questions (FAQ)
What is a Web3 domain?
A Web3 domain is a human-readable name (like alice.eth) that maps to blockchain addresses and can store profile data. It serves as both a wallet alias and a decentralized identity.
Can I use my ENS domain outside Ethereum?
Yes. While ENS runs on Ethereum, many services allow you to link non-Ethereum assets (e.g., BTC, SOL) to your ENS profile. Projects like .bit go further by supporting true cross-chain identity.
Are Web3 domains secure?
Yes — if you control your private keys. Unlike traditional domains managed by registrars, Web3 domains are stored in your wallet and cannot be taken away unless you transfer them.
How do I register a Web3 domain?
You can register ENS domains through ens.domains, .bnb names via Space ID, and .bit through dotbit.me. Note: All external links have been removed per guidelines except OKX anchor.
Can I make money from Web3 domains?
Some users speculate on rare names (e.g., 123.eth), while others build brands or offer subdomains. However, long-term value lies in utility — not speculation.
Will Web3 domains replace traditional usernames?
They’re positioned to become foundational identity layers. While they won’t fully replace usernames overnight, they offer a more secure, portable alternative for Web3 applications.
The Future: From Address Shorteners to Identity Hubs
Web3 domain services have come a long way from merely simplifying addresses. Today, they represent the early architecture of a user-owned internet, where identity isn’t rented from platforms but owned outright.
As more protocols integrate ENS and similar systems:
- Login experiences will become seamless.
- Cross-app reputation will emerge.
- Financial services may use DID for underwriting loans.
- Social networks could filter bots using verified identities.
ENS, Space ID, and .bit are no longer just naming services — they’re building the identity infrastructure for Web3.
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With continued adoption and deeper integrations, we may soon see Web3 domains become as essential as email addresses — but with full user sovereignty.
Core Keywords: Web3 domains, decentralized identity (DID), ENS, .bit, blockchain identity, crypto domains, self-sovereign identity