Registrar Unstoppable Domains raises $65 million to turn website domains into NFTs

A virtual land rush for NFT web domains, which use public blockchains that give users complete ownership of their data, helped one of the few companies creating such sites claim a $1 billion valuation today.

Unstoppable Domains raised $65 million in a Series A funding round, achieving so-called unicorn status. The funding was led by Pantera Capital with participants including Alchemy Ventures, OKG Investments and PolygonMATIC
along with previous investors Boost VC and Draper Associates.

Coinbase Ventures and Protocol Labs, which were initial investors in 2020, did not join the new round.

NFT domains, unlike the traditional kind, live on public blockchains and give users complete ownership of their data. The domains, with extensions such as .nft, .wallet and .crypto, can replace long wallet addresses. While traditional domains require annual subscriptions, Unstoppable requires a one-time fee that can be as low as $5.

Interested in learning more? Subscribe to Forbes CryptoAsset & Blockchain Advisor here:

MORE FROM FORBESForbes CryptoAsset & Blockchain Advisor

In addition to giving users ownership and control over their digital identities, NFT domains separate them from wallet addresses. In current cryptocurrency or non-fungible tokens (NFT) transactions, wallet addresses act as users’ identifiers, combining personal and financial information. It increases vulnerability to fraud.

An NFT domain acts as the user’s personal address across blockchain-based applications, and hosts the personal information the owner wishes to disclose.

“Unstoppable Domains is rapidly defining a new category of decentralized identity that will change the internet as we know it,” said Paul Veradittakit, a partner at Pantera.

The $1 billion valuation highlights the importance of infrastructure behind decentralized, digital identities, separating “the identity component from the financial component,” says Matt Gould, Unstoppable founder and CEO.

“We work with wallets and fintech companies as our partners,” says Gould. But “we intentionally don’t have an exchange or any other type of business inside our business model.”

The company relies heavily on partnerships to expand its user base by providing infrastructure and custody services to the NFT domains that can be used in over 265 applications. Domain owners control what aspects of their personal information can be retrieved, unlike in the case of conventional online transactions.

Through the company’s partnership, Unstoppable has 10 different TLDs, including .bitcoin, .coin and .blockchain. With each new partnership, users can decide which on-chain and off-chain data to display across different apps.

There are potential downsides to blockchain-based domains. An October 2021 report by MicrosoftMSFT
found that the lack of centrality makes it difficult to shut down the sites or even trace their owners. “This trend of threats leveraging blockchain domains as infrastructure with the means to create an indisputable criminal network should be taken seriously,” according to the report.

Nora Chan, vice president of communications at Unstoppable argued that giving users control over their own assets “prevents honeypots, protects users and will lead to a safer Internet. Apps already filter out content that is illegal or harmful, and they will continue to do so the.”

Unstoppable started operations in 2019 and has so far registered 2.5 million domains, generating $80 million in revenue. Before the investment was announced today, the company had only received $7 million in funding.

The company was also ranked 39th on the Forbes list of Best Startup Employers, with its remote-only structure a key to its performance.