Dot ETH domains by Ethereum Name System (ENS)
".ETH" is the official domain extension of the Ethereum platform. The project is called Ethereum Name System (ENS). The .ETH domains are controlled by two Ethereum DApps (smart contracts). These DApps are, respectively, for registering and resolving domain names. Thus, the domains are completely decentralized, secured and censorship-resistant.
The main goal of .ETH domains is to be used as an alias system in the Ethereum Project. The domains can be used to resolve a wide variety of resources. The initial standard defines the resolution for Ethereum addresses. Thus, you can send Ethers directly to the domain name instead of the Ethereum address. The system is extensible by design, allowing more resource types, including Swarm and IPFS content hashes, to be resolved in the future.
The main difference that sets this domain apart from other decentralized domain systems is that the registration is done via an auction process. A Vickrey auction is used in which bids are sealed and the highest bidder wins but pays only the bid of the second highest bidder. This process lasts five days and contains three main phases:
1. Starting the auction (3 days)
We are opening an auction for a name you wish to buy. We place a bid equal to or even larger than the domain price you have paid to us. After that, a three-day timer starts for other people to place bids on the name. During this period, the details of bids are obscured. Nobody can tell how much you bid, or even what name you are bidding on. We hide all domain requests via domain hashes.
2. Revealing the bids (2 days)
The first phase ends after three days. Then begins the second “reveal” period. During this period, everyone who bid must reveal the details of their bid. This deadline is very important because if someone misses it, he or she loses the entire bid and the chance to win the name. If our bid is not the highest, the money (minus a 0.5% fee) is refunded to the ENS contract. We then refund the money to our client.
3. Finalizing the auction
At the end of the two-day reveal period, the winner is the account that revealed the highest bid. It must pay only the amount of the second-highest bidder (that's how the Vickrey auction works). This amount is locked in a contract for as long as the winning bidder retains control of the name. Ethers that are locked in the name cannot be spent and belong to our client (you).
After holding the name for at least one year, you can choose to release the name and recover the entire amount of the deposit locked behind the name. If you request the transfer of the name to your account in the future, all locked ethers will be transferred, too.
You can find detailed technical information about the auction process here.
As you can see, this is a complex process. Winning is not guaranteed because other users can bid, too. However, there is good news – all domains are registered via their sha3 hashes. That means no one can directly see that you want to register a particular domain. Only users who want that name at the same time will participate in the potential bidding. The chance that this will happen exists but is very low.
Our goal is to make the process of registering an .ETH domain as easy as possible for our clients. We will go through the whole process and try to register your domain name. We will use all your money for bidding. If someone outbids us, we will issue a full refund.