In today’s digital age, domain names have evolved far beyond simple web addresses—they are now valuable digital assets. Companies routinely invest millions to secure key domains and establish their brands.
However, the infrastructure supporting domain names remains deeply centralized, controlled by organizations like ICANN and registrars. This centralization, while not inherently malicious, introduces critical vulnerabilities such as censorship, mismanagement, and exploitation by bad actors.
The Canadian trucker protests offered a stark example: centralized platforms froze funds intended for protesters, leaving Bitcoin as the only financial channel that successfully reached them.
These events underscore the urgent need for decentralization in naming systems—an issue the Spaces Protocol, built on Bitcoin, is uniquely positioned to solve.
Spaces Protocol offers a decentralized, permissionless identity system anchored in Bitcoin. Users claim unique names, called “Spaces,” through a transparent auction process.
Proceeds from auctions are permanently burned, ensuring a trustless system while simultaneously reducing bitcoin’s circulating supply.
Once acquired, Spaces can be subdivided into “Subspaces,” allowing individuals or organizations to create self-sovereign identities that operate off-chain or on-chain, depending on user preference.
Mike Carson, one of creators of the Spaces Protocol stated:
“Domain names are digital assets, and just like money, there’s no reason they should require third-party control.”
By leveraging Bitcoin’s robust infrastructure and zero-knowledge proofs, Spaces offers ownership without intermediaries or centralized points of failure.
Carson, a veteran in the domain industry and founder of Park.io, drew from his years of experience managing ICANN-accredited registrars. He saw firsthand how centralized control of domain names often led to censorship and exploitation.
“It’s all over the place—domain names are taken or censored all the time,” Carson explains. He pointed to the Spanish government seizing domains during Catalonia’s independence movement as a glaring example of how political interference can compromise ownership.
“If there’s one thing as important as money, it’s naming. It’s urgent to decentralize this space,” Carson noted.
Spaces Protocol officially launched at block height 871,222, marking a significant milestone after years of development. The protocol’s auction system was designed to prevent squatting, a problem that plagued earlier projects like Namecoin and Handshake.
Only 10 top-level Spaces are released per day, ensuring adequate attention for each name. Auctions last 10 days, and losing bidders are refunded their bids while the winning bid is burned. Carson emphasizes:
“We wanted this to be 100% cypherpunk—no token, no pre-mine, no foundation. Just Bitcoin.”
The result is a system that aligns with Bitcoin’s ethos of decentralization and trustlessness.
The protocol’s innovative design extends far beyond traditional web domains. Spaces can enhance decentralized platforms like Nostr, offering human-readable usernames without reliance on DNS.
Bitcoin wallet addresses can also benefit, replacing long alphanumeric strings with intuitive, memorable names. The concept of Subspaces enables even greater scalability, allowing top-level Space owners to create millions of individual identities verified through zero-knowledge proofs.
Importantly, these identities remain sovereign: even if a registry operator becomes inactive, users can transition their Subspaces on-chain, maintaining self-sovereignty.
Privacy, a cornerstone of Bitcoin, is integral to Spaces Protocol as well.
While top-level Spaces are traceable on Bitcoin’s blockchain, Subspaces can offer enhanced privacy through techniques like silent payments or unique addresses for each transaction.
“Subspaces have the potential to be completely anonymous, especially if distributed creatively by top-level Space owners,” Carson explains. This flexibility empowers users to adapt the system to their specific needs, whether prioritizing privacy, scalability, or accessibility.
Unlike projects that bloat Bitcoin’s blockchain with unnecessary data, Spaces Protocol is engineered for efficiency. Only hashed names are stored in Bitcoin’s witness data, keeping the on-chain footprint minimal.
“We didn’t want to load tons of data onto Bitcoin,” Carson notes. This design choice reflects a deep respect for Bitcoin’s ecosystem, avoiding some of the controversy sparked by other projects which resulted in more data on-chain.
By focusing on scalability without sacrificing Bitcoin’s principles, Spaces Protocol strikes a delicate balance.
The protocol’s reliance on Bitcoin as the base layer ensures unparalleled security while minimizing trust in third parties. For instance, the auction mechanism leverages Bitcoin’s scripting capabilities to enforce fairness.
Each bid burns additional funds while refunding the previous bidder, ensuring that only the final bid remains permanently burned. This approach not only prevents squatting but also incentivizes fair participation. The proceeds are burned, not sent to developers or a foundation.
Spaces Protocol is also forward-looking, with plans to support integrations like Fabric, a decentralized DNS resolver that leverages Bitcoin for trustless zone file publication.
The team is exploring advanced features like silent payment addresses, ensuring the protocol evolves alongside Bitcoin’s ecosystem. “With Spaces, there’s no third party between you and your name,” Carson says.
As cyber threats grow and AI tools make sophisticated attacks more accessible, decentralization becomes an urgent necessity.
Spaces Protocol provides a scalable, censorship-resistant framework for digital identity in an increasingly digital world. Whether for securing a domain, creating a Nostr username, or decentralizing wallet addresses, Spaces Protocol is a powerful tool for the digital age.
“I’m excited to see what people build with it,” Carson concludes. With its bold vision and unwavering commitment to Bitcoin’s principles, Spaces Protocol is set to revolutionize how we think about ownership in the digital world.
