Web3 domain names are experiencing rapid development, becoming a major rise point in the recent NFT market.

Web3 domain names have performed impressively in the second half of this year, becoming an important rise point in the NFT market. Taking ENS as an example, the trading volume has increased by 22.48% month-on-month over the past three months, with the total number of domain registrations exceeding 2.6 million. The market value of ENS has risen by 38.62% in the past three months. In addition to ENS, domain projects like SPACE ID and Unstoppable Domains have also seen rapid growth in registration and user numbers.

Web3 domains have become a standard configuration for public chains, with nearly 30 public chains currently deploying domain projects. New public chains such as Aptos and Sui have also launched on-chain native domain projects. Compared to traditional domains, Web3 domains have essential differences in terms of mapping objects, carriers, resolution methods, and ecosystems.

• Mapping Object: Web3 domain mapping wallet address, Web2 domain mapping server
• Carrier: Web3 domain names exist in the form of NFTs, while Web2 domain names are recorded by authoritative institutions.
• Parsing method: Web3 domain uses decentralized resolution, while Web2 domain uses centralized resolution.
• Ecosystem: The Web3 domain ecosystem is fully open, and Web2 domain participants require permission.

The main functions of Web3 domain names include:

1. Collection address, user account, and other information
2. Aggregate user data
3. Access the dApp supported by the domain name
4. As a social account nickname

The current development trends of Web3 domain names are mainly:

1. The rise of multi-chain deployments and multi-category domain projects.
2. Deepen cooperation with DID applications such as social graphs and reputation platforms.
3. Use more than speculation
4. The competitive landscape of domain names and public chains is becoming similar.

In the long term, Web3 domain names will become users' identity credentials and unified accounts in Web3, truly realizing their value as decentralized identities.