Geopolitical Risks of .io Domains: Uncertainties Facing the Web3 Industry

The sovereignty transfer agreement regarding the Chagos Archipelago between the UK and Mauritius is not merely a geopolitical change. This decision could threaten the continued existence of the .io domain, which over 100,000 tech companies and startups rely on. In the Web3 industry, approximately 16% of projects have adopted this domain, making urgent responses necessary.

Geopolitical Changes and the Chain Reaction for the .io Domain

In October 2024, the UK agreed to relinquish sovereignty over the Chagos Archipelago to Mauritius. This historic political agreement symbolizes the end of Britain’s colonial era in Africa but also brings unforeseen technological repercussions.

.io is the country code top-level domain (ccTLD) derived from “British Indian Ocean Territory” (BIOT). Initially managed by the Internet Computer Bureau (ICB), it is now owned and operated by the American company Identity Digital. The UK government had a contract to receive a portion of registration fees for each .io domain, generating millions of dollars annually.

The core issue is what happens to the international status of this domain after the sovereignty transfer. If BIOT is reclassified as part of Mauritius, it could be removed from the ISO 3166-1 country code list, thereby losing its legal basis for the .io domain.

The History of ccTLD Deletions and the Future of .io

Over the past decades, deletions of ccTLDs by ICANN and IANA have been rare but not unprecedented.

Historically, five major ccTLDs have been deleted:

• .yu (Yugoslavia): Discontinued in 2010 after the country’s dissolution in the 1992 civil war.
• .tp (East Timor): Deleted in 2015 following independence in 2002.
• .zr (Zaire): Removed in 2001 after the country’s name change.
• .an (Netherlands Antilles): Discontinued in 2015 due to geopolitical reorganization in 2010.
• .um (U.S. Pacific Islands): Deleted in 2007 due to political decisions.

Interestingly, .su (Soviet Union) remains active despite the USSR’s dissolution in 1990, as it continues to be in use.

Standard ICANN procedures typically allow a transition period of 5 to up to 10 years when a ccTLD loses qualification. Domain administrators receive notices and can designate alternative contacts, but ultimately, the domain must conform to international standards.

Conditions for the Continued Existence of the .io Domain under ISO Standards

The fate of the .io domain hinges on whether BIOT can maintain its ISO 3166-1 code in the list. If ICANN decides to delete the .io domain, over one million registered domains would require comprehensive migration guidance and a transition period. Given the significant impact on the tech industry, industry groups are likely to exert pressure.

Conversely, if BIOT retains its territorial status and continues to be recognized internationally, the .io domain’s survival prospects improve. However, this path involves complex legal and political negotiations involving the UN and ICANN.

About 16% of Web3 Companies Use the .io Domain: Current Status and Challenges

In the tech sector, .io holds a special position. Originally recognized as an abbreviation for “Input/Output,” it became highly popular among startups and software companies. It is also the standard domain for “io games”—browser-based multiplayer games—exemplified by platforms like Itch.io.

In the Web3 and crypto industry, similar trends are observed. According to Foresight Wiki, about 16% of roughly 20,000 Web3 companies and projects use the .io domain. Notable examples include:

• Layer 2 solutions: ZKsync, Arbitrum, Optimism, Scroll
• Web3 protocols: Sei, Damus
• Development studios: Matter Labs
• Finance-related projects: CoinFund, TrueFi
• DeFi protocols: Raydium, DODO
• Web3 infrastructure: Mask Network
• Financial services: Scallop

A notable case is the 2021 sale of the domain “Metaverse.io” for 1.14 million yuan (approximately $200,000), the highest publicly recorded transaction for an .io domain, indicating the commercial value of such domains.

Additionally, crypto exchange Gate.io has adopted its brand name as its main domain, exemplifying the trust and recognition associated with the .io domain.

Potential Industry Impact and the Need for Preparedness

If the .io domain were to be deleted, the Web3 industry would face multiple risks:

Technical Challenges: Over 100,000 projects would need to migrate domains simultaneously, involving DNS record updates, SSL certificate reissuance, and user bookmark updates, creating a massive logistical challenge.

Brand Value Loss: For startups and early-stage projects, the .io domain often symbolizes a tech-oriented identity. Transitioning to another domain could lead to reduced recognition and trust.

Legal Uncertainty: Until the ccTLD deletion process is finalized, investor and user confidence could be shaken.

Future Scenarios and Industry Responses

The ultimate fate of the .io domain remains undecided. ICANN and IANA’s final decisions, along with BIOT’s international status, will be decisive.

The industry must prepare for multiple scenarios. Some major projects are already exploring alternative domain registrations and are preparing phased migrations from .io to .com or .xyz domains.

In conclusion, the .io domain issue is not just a technical matter but a complex intersection of geopolitics, international law, and industry interests. The industry must balance optimism and caution while preparing for the worst-case scenario.