Warning to .io domain users: Ownership issues arise after Mauritius transfer

The UK has made a historic decision to transfer sovereignty of the Chagos Islands to Mauritius, which has brought to light serious challenges related to the operation of the .io domain. This change could have unforeseen impacts on the currently registered over one million .io domains.

Why is the .io domain facing a crisis?

The .io domain was originally assigned as the country code top-level domain (ccTLD) for the British Indian Ocean Territory (BIOT). The registration operations for this domain are handled by the private company Internet Computer Bureau (ICB), which is currently owned by Identity Digital in the United States.

Named after the initials of “Indian Ocean,” this domain has existed since 1997 and has been overwhelmingly popular among tech companies and gaming-related businesses. According to The Independent in the UK in 2014, the UK government, in cooperation with ICANN, earns a certain revenue from a £60 fee when each .io domain is activated.

However, the territorial change may have rendered the legal status of the .io domain uncertain.

Precedents for ccTLD deletion: 5 past cases

According to records from ICANN, the Internet Corporation for Assigned Names and Numbers, since its establishment in 1998, ccTLDs have been removed from the DNS root five times. These precedents help us understand potential scenarios that .io might face.

Past ccTLDs that were deleted:

.yu, representing Yugoslavia, was fully deleted in 2010 after the country’s dissolution. The .tp domain related to East Timor was removed from the DNS root in 2015 following its independence in 2002. The .zr domain for Zaire and the .an domain for the Netherlands Antilles both ceased usage in 2001 and 2015, respectively. Additionally, the .um domain, assigned to small islands outside the US mainland, was deleted in 2007 due to lack of usage.

A notable exception is .su, which continued to exist after the dissolution of the Soviet Union and remains valid today.

The future of the .io domain: a maximum grace period of 10 years

According to ccTLD deprecation policies, domains that lose their country or territory code must cease usage five years after being removed from the ISO 3166-1 standard, in principle. Domain administrators can apply for an extension of up to five years, making the maximum possible duration of existence theoretically 10 years.

Analysis by Domain Incite suggests that the fate of the .io domain depends on whether the British Indian Ocean Territory retains the IO code in the ISO 3166-1 list after its integration into Mauritius, and whether it continues to be recognized as an independent territory by the United Nations. If BIOT loses its status as an independent administrative unit, the risk of deletion for the .io domain will significantly increase.

On the other hand, if BIOT still qualifies as an independent territory, the likelihood of the .io domain’s continued existence increases, though the complex sovereignty issues may make domain management more difficult. The chances of receiving special treatment like .su are considered relatively low.

Current use of .io domains by Web3 companies

In the tech sector, “IO” is widely recognized as an abbreviation for Input/Output, making the .io domain naturally suitable for technology companies. Its simplicity and technological image have made it popular among startups and gaming-related firms.

Among approximately 20,000 Web3 companies and projects registered on Foresight Wiki, about 16% utilize .io domains. Notable projects include ZKsync, Arbitrum, Optimism, Scroll, Sei, Damus, CoinFund, Scallop, Mask Network, TrueFi, Raydium, and DODO.

The value of .io domains in the market has already been proven, with a record of the “Metaverse.io” domain being sold for 1.14 million yuan in 2021. The entire industry has over one million registrations, forming an estimated market size of around 40 million dollars.

Future outlook and implications for companies

Changes in the legal status of ccTLDs are complex issues intertwined with international politics, not just technical matters. Web3 companies using the .io domain should closely monitor the territorial recognition trends by the United Nations and ICANN over the coming years. Even in the worst-case scenario, a grace period of about 10 years is expected, so it is prudent to consider phased domain migration strategies.