New dot com domain boom! Invest money or not?

Started by Bukvarix, Jul 05, 2022, 04:42 AM

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BukvarixTopic starter

It appears that prices have risen for 2-3-4 L in the commercial zone, after being stagnant for a decade. The past year has seen an increase in prices for 2 letters from 200K to 500K, 3-letter from 10k to 25K and 4-letter from $50 to a minimum of $250.

In my opinion, this is due to three reasons: Chinese investors, growth in the American markets and disappointment in new domain zones. It is a fact that prices are increasing and while I have my own perspective on the situation, I am curious to know what others think.


All the necessary factors exist. It is possible that the explanation is quite simple - over time, "2-3-4 L in .com" become scarce on the market due to an increase in the number of companies and projects, leaving fewer options in .com.

Consequently, the price is naturally increasing. Therefore, it seems that dot com is becoming increasingly dominant as time goes on.


You should additionally take into account such a factor as the growth of online services and online stores during and after the problems of 2020. The state of the labor market showed the relevance of remote options for earnings and service. Working remotely turned out to be more profitable than a daily stay in the office. And ordering products and medicines with delivery through the network is safer. I think this is what determined the increase in prices for domain names.


Numerous investors were eager to invest at any valuation in any dotcom company, particularly if its name contained an Internet-related prefix or ".com" suffix. Venture capital was easily raised, and investment banks fueled speculation by making substantial profits from initial public offerings (IPOs), which encouraged technology investment. This led to a stock market bubble that ignored traditional indicators such as the price/earnings ratio in favor of confidence in technological advances leading to significant profits for companies in the quaternary sector of the economy.

Between 1995 and 2000, the Nasdaq Composite grew by 400%, with the price-to-profit ratio reaching 200 - significantly higher than the peak ratio of 80 for the Japanese Nikkei 235 during the asset price bubble in Japan in 1991. While many high-cap stocks experienced exponential growth, investors sold shares of slow-growing companies to invest in Internet stocks, with more stocks falling than rising despite the Nasdaq Composite and S&P 500 index showing promising growth.

The media capitalized on this trend, reporting on the stock market with the same level of hype as sports events. Promising dotcom companies could become public companies through an IPO and raise substantial funds, even if they never made a profit. Employees who received stock options would instantly become paper millionaires when their companies held an IPO but were often prohibited from selling shares immediately. Successful entrepreneurs, such as Mark Cuban, sold their shares or signed hedges to protect their achievements at the peak of the boom.


Indeed, now many companies are moving their business online due to the fact that they are very much preventing it from being carried out offline (permanent coronavirus quarantines, the war in Ukraine, etc.). It also affects the fact that there are not so many verified domains. If there is a quality product and a desire to develop, then I think it will be a good investment, but at a reasonable price