Ideas for a 'squatter-oracle' - non-rent based squatter disincentives


Many ideas around the rent system, how to to make it fair, and the permanent registrar are formulated to discourage squatters.

What if we could imagine systems to “fairly” and trustlessly recognise and punish squatters that is independent from the rent / lockup of ETH model or at least doesn’t complicate the experience for 99% of users who are not squatters.

this post proposes initial ideas, trying to separate rent and squatter detection
While writing I was seeing many problems and missing pieces :smile: , but still wanted to get it out there.


  • a pro-squatter
    is someone who buys large quantities of domains
    with the intention of later reselling them and making a profit.
    and potentially is ready to keep them for a long time

  • a speculative-squatter
    can also be someone who buys even just one high-prized domain or few domains from legitimate owners, with the intention to make a profit, probably taking advantage of their early adopter conditions

  • a squatter-troll
    is someone who buys a domain so others won’t be able to use it (therefore they don’t want to sell it and make a profit, nor gift it for free) but doesn’t use it themselves.

  • a squatter-angel
    is someone who buys or has bought large quantities of domains with the (declared/alleged) intention of giving it, for free or at a cost, to the right organisation or people, and are moved in good faith as anti pro-squatters to “protect” the interest of these 3rd party organisations who don’t know about ENS yet.
    Often some domains they bought are also done with the speculative-squatter mindset of later reselling them at a profit.

Ideally solutions should tackle all the first 3 kinds of squatters, but admittedly the pro-squatter is the priority. and having a fair system to disincentivise squatters will probably avoid the need for the fourth kind.


1- in normal DNS world you would recognise a squatter (or an abandoned domain) through one of those systems

  • the domain is not used or it clearly shows a for sale indicator or advertising
  • if you check the whois you would see that they’ve owned it for a long time

the assumption here is that these 2 parameters (is the domain used? and for how long has it been held by the owner?) can be used to determine wither the user is a squatter or not.
This is possibly hard to tell and an incomplete criteria for the blockchain (especially around how to determine if a domain is truly used) but I won’t go into these details right now

Idea for a mixed-chain Squatter Oracle

the idea proposes a mixed on-chain / off-chain process to

  • “fairly” determine if a domain has been squatted (hence if an owner is a squatter of some kind)
  • return the domain to the market if it has been squatted
  • discourage squatters, through economical and functional incentives
  • encourage anti-squatters through economic and functional incentives

it is a system that can have it’s own governance and falls in the sphere of dispute resolution, so it could use an ENS specific mechanism or a 3rd party governance solution


  • What if after 1 year from registration (because people some times buy domains to make something with them but never end up doing it, like highlighted here )

  • anyone can start a request on a domain that it’s not “being used” (I know this is difficult and thorny concept to define but bear with me :slight_smile: )

  • and submit a claim by staking some ETH
    *adding off-chain some information or data proving that the domain has not been used or is owned by a squatter (maybe submitting on chain a hash of the content of the claim)

  • when a claim is submitted the smart contract selects at random (probably using block number) some users from the pool of ENS validators (that any user can signup/signal to join)

  • each validator stakes some ETH to signal they will participate in the validation. Validation can be started only after a threshold TBD is attained

  • If the validation is started, each participating validator analyses the data provided by the claimer

  • validators then stake more ETH to signal their vote (Yes domain is squatted, No domain not sqatted, maybe a 3rd option: Not enough information)

  • if they attest like the majority they will get the reward split from those that are slashed and probably a % from the rent (maybe they can convert this payout in registration time for their own domains)
    I’m intentionally skipping a lot of details here as I just want to give the general gist, but I’m aware that there are a lot of details to solve

  • if the domain is flagged as “squatted”, the current owner has some time to submit the counter argument / proof of any usage prior to the claim that demonstrate the usage (got some ideas about this but will post it another time)

  • validators (some obligated, some optionally) perform another round of analysis and a vote on the claimants data

  • the claim rewards a few things:
    1- a % of the stake slashed from other validators
    2- a % or the rent / locked ETH of that domain (if any)
    3- returns the domain to the market and gives the ability to bid again for the domain, along with anybody else, including the current owner
    4- a vote of preference in case the claimers bid is tied with another as the highest bid (remote possibility)

Downsides / Problems:

  • the system needs to be sybil resistant otherwise a squatter can create thousands of validators to increase the chances of squatting out someone from their domains, although the randomness of the selection can partially mitigate this

  • the system requires that there is a way to communicate with validators and notify them about their human task to be done.

  • The system needs to discourage claiming-trolls that as much as squatters can claim the domain, and make the legitimate user loose a lot of time by having to submit proofs.

  • the system would require a way to detect if a domain is used, ie submitting a hashed event each time a domain is requested to the resolver or to the registry (the owner of the domain can unhash and reveal those transactions or through a zksnarks mechanisms only provide the proof that these TXs have happened, without revealing which ones…complicated)

Possible Improvements or Variations

  • the claim is first submitted in a way that doesn’t reveal the domain being claimed upon, in such a way that the owner, potentially the squatter, can’t know wither his domain is being verified upon and can’t set up decoys or usage simulators


One succesful claim = waterfall of claims:

  • if a squatter is recognized as such through one claim, it is possible that automatically many other claims will be raised over other potentially squatted domains,
  • and there can be an emergent property for which the squatter doesn’t loose just one domain and deposit, but all/most of them, creating a strong economic disincentive to become a squatter in the first place
  • and creating a strong economic incentive instead to become a “squatter hunter”: once recognized one squatter it’s probably easy to get successful claims on other domains they own and hence gain a % of their locked ETH / rent payed.

Proposed design outline for the permanent registrar

This entire idea seems to focus on the premise that dispute resolution is pushed into layer 1 of ENS. Which both @nickjohnson and I have been against for multiple reasons.


What’s all this squatter-hate about?
I’m an ethical person, but don’t you think that time Google forgot to renew their domain name that it would be OK for a savvy internet user to sell it back to them for a million dollars? They can afford it. In fact Google makes heaps more $ than that from our data.


The squatters are speculating whether ENS will ever be useful to anyone, and help you iron out kinks in your system which was far from perfect in the early stages and burned a lot of GAS. We still don’t know whether people will ever adopt this en masse. And there is a character limit in place, which ensures by the time you are ready for mass adoption everyone should know about ENS by then.
When are you people going to wake up that punishing squatters is a waste of time and won’t ever improve your system, will in fact only ever make it worse by introducing dumb rules that squatters will work out a way to go around anyway? If such a goal was possible, don’t you think they would have worked it out for dot com by now?
Speaking of dot com, I am a poor designer, and the only leverage I have over a rich client who hasn’t paid his bills in years is the fact that his .com is registered in my name. He has every advantage over me, mega wealthy, hue legal power at his command, a true sociopath in every sense of the word, except he doesn’t understand the internet very well so I have one thing that might stop me from never getting paid from him…
Look at where ENS came from, crypto-currency which by it’s very nature is speculative, and also a place where the early adopters sometimes had an opportunity to make a profit. What exactly is wrong with profit? What is wrong with the free market? Are you a communist? All I have ever done so far is lose money on crypto / blockchain / tokens etc. I have one shot at making a little $ in this game by having a few good ENS names and there are people like you idealogicaly opposed to players like me like what I was doing was criminal? I don’t steal, I don’t scam, in fact I spend a lot of time blogging to protect people from getting scammed. I just don’t understand why you think like this and put all your energy into such a wasted pursuit?


I’m not saying dispute resolution should go on layer 1 either… but is there a layer that will have dispute resolution?


I wouldn’t say that withholding a clients domain classifies as “ethical”,
especially when it’s so easy to set them as the owner and register yourself as simply the technical administrator.

I also think that by withholding your clients property you are contravening to the same free market philosophy that you seem to aspire to: by withholding their domain you are de facto limiting their freedom to choose another provider if they so wished, you are “kidnapping” something that would be rightfully theirs, and forcing them into a relationship with you.

Now, I agree that in some situations the dynamic you describe could be used as leverage in your favour, I used it myself in the past, but only until the client payed their invoice.
However I also think that:

  • leverage should be used only until you get what you need (the 1st invoice payed)
  • and also that a client who doesn’t want to pay is better to loose it as soon as possible.

May I ask you how many .eth domains do you own already? :slight_smile:


Selling something is not withholding it.
You want an apple, you pay the market price.
Oh, you’re Apple computer, and you want apple.ens but you stalled on buying it for a few years and now the price has gone up? Fair enough, that’s how the market operates.
I mean they already own the name Apple, which to be fair, has been around since Adam & Eve.
I own about a dozen eth domains, and a few of them are directly useful to me, the others are speculation about names not registered and a few are corporations that own a massive chunk of the internet.


I understand,
your expectation is that those companies will want, one day, to use decentralized technologies, among which they will want to use Ethereum, and they will need their domains.

Are you aware that other TLDs can be used in ENS? like .xyz and .luxe currently.
What do you think a company like Google would do if they where able to use their currently owned .com domain inside of Ethereum?
(honest question, to understand how much people actually know about these ENS features :smile: )


“What do you think a company like Google would do if they where able to use their currently owned .com domain inside of Ethereum”
They would probably collect the rent from the Google pay-for services that way to avoid transactions fees and also pay-out their Youtube content creators for a start. Also, possibly use it for legal contracts without the need for a 3rd party to witness the contracts. I don’t pretend to be an expert on this tech, like I say I am just a small fish speculator.


I meant, do you think Google would care to own a google.eth, knowing that they can easily use for Etherum related operations?
(even subdomaining it like you suggest)

would it make buying google.eth still a valuable thing?


No, I do not think it would. In fact if I can use .com instead of buying .ETH I’m not sure I need it either. This subject is now definitely beyond my knowledge, I had no idea you could use a .com to send and receive crypto instead of a long complicated number address?


with a .com domain it’s not yet possible, but it will be, one day.
For now you can register and use a .xyz domain and .luxe domain
that are testing grounds for all the other TLDs
you can read about it here: