Navigating Legal And Trademark Safeguards For Web3 Domain Investments

HandyCon 2024 | Day 1 - Navigating Legal And Trademark Safeguards For Web3 Domain Investments - YouTube

(00:03) [Music] [Music] all right thank youx another recurring sponsor this year um great video as always everyone so we are in our second session um and we have uh it was even just mentioned in the last session right trademarks and legal I think it's a common one discussed during the um main conference and we're always a pleasure to have Tom here Tom Barrett from inera who's an expert on this and has shared over the years in our community and many others about this and Chango we all know Chango Unchained she
(00:59) have a little had a little Tech issue I don't know if it's working now jeno do you hear us or can you any luck I hear the clicking that might be me oh that might be you okay well I think well we you can test um test that Chango but Tom did prepare some slides to get started if everybody can bring their questions we should also try to learn the Q&A tab if people can learn the Q&A tab there's a question tab under the chat box you can leave your questions there and we can try to get to those goes towards the
(01:31) end of the session but Tom if you want to take it away let me just bring bring up the slides here if I can do that awesome all right you see my PowerPoint slide yeah I see the slides all right cool hey everybody um happy to be here uh for my third or fourth time uh so the topic I was asked to present on today is called navigating legal and trademark safeguards for web 3 domain Investments and um this is an interesting topic I'm going to focus on the word Investments here U because like all of you uh We've invested several
(02:14) years in time sweat you know buying names writing software and it's it's still labeled as an experiment as our some other web three projects uh and so I when I hear the word Investments though I hear that maybe we want to move from experimentation to monetization and perhaps starting to uh see a return on on the Investments we've made over these past few years uh so a little bit about about myself and is it Nick a quick sound check Michael everything okay yep I I put mute on but I hear you loud and clear and I think others are
(02:55) hearing you too sweet so if you guys don't know me uh I run two I and domain name regist and Circa and name share I focus on providing really custom uh retail solutions for a variety of regulated top level domains like bank. CPA realtor. dopost is what I'm relaunching right now uh very active in the Ian Community says its formation back in 1998 uh active today on the name Collision advisory project which which I'm not going to talk about today also on their nominating committee to appoint half of their board uh also active in
(03:38) the trademark community so although I'm not a trademark lawyer I've built uh internet businesses for trademark lawyers and I lead the the web 3 efforts at the international trademark Association and very active in a variety of web web three projects from handshake to ens uh to some tradmark protection uh just a quick note I'm not going to talk about collisions but uh as many of you may know I did help serve as the intermediary a month or two ago to to getmusic TLD into the hands of the Ian registry operator uh I did that free as
(04:24) a public service basically and I know there's a few other uh I can that have not been reserved and out in the wild and so happy to help find those uh to to to be uh in the hands of the Ian registry operator if anyone's interested so um as I said I think there's a mind mindset shift here from experimentation to commercialization when we talk about the word investment it means that U you know we want to monetize that we want want to see a some sort of exit uh perhaps to to create some generational wealth and so
(05:07) I've been and this is certainly part of my journey as well because I invested a lot in different web three projects and so I want you I want to bring you along to where I am in terms of an investment thesis for web 3 and uh it may throw cold water on on some of what you're thinking but I think it's it's practice iCal and realistic at this point so again I've been doing this for since 1995 when I I launched a business targeting trademark lawyers and the internet as all of you know is built on
(05:45) the DNS nothing works without a a stable and secure DNS and the the DNS actually uh is is maintained in terms of the standards is maintained by the internet engineer caring task force or ietf and they are basically the folks that ensure there's a predictable stable and secure internet okay that's the DNS so it turns out that DNS is the glue that also makes web 3 possible so we've heard about this word soup of what is web 3 from free speech to trustless digital identity self- Sovereign Unstoppable uh ownership should not be
(06:31) INF fringed that's from the ens Dow Constitution U uncensorable right so all this web three stuff are the ideals that spawn experiments like handshake and ens and a bunch of other projects but the the reality is all those web3 Investments are not replacing the DNS they're not an alternative they they're basically simply extending the DNS and this this is where you know some of you may differ but I believe that the next version of of of the utility for web 3 are going to be a an extension of what you can do today with a web 2
(07:17) domain name so it's an extension and and because we already have an engineering body out there uh you know they are working on what they call responsible DNS integration to web three and so in terms of my investment thesis I'm interested in how we can extend the current DNS and leverage some of the utility from web3 so this is just a a quick uh side side here is so what is what do we what does it mean to extend the DNS it means first of all don't abuse the DNS right so here's a definition of DNS abuse that I
(08:00) think is very important in terms of my investment thesis because I don't want to invest in projects that encourage or prone to DNS abuse so DNS abuse is any activity that makes or intend to make use of domain names the DNS or any digital identifiers I.E web3 that are similar in form or function to domain names to carry out deceptive malicious or illegal activity all right so deceptive malicious and illegal activity so I don't want to be part of a project where that is prevalent uh this by the way is a a definition put out by the
(08:45) trademark Association last year it obviously includes cyber squatting trademark imprisonment as well as other forms of DNS abuse so the key message here is that the reason why the internet Community is so concerned about DNS abuse is that it's it's a public safety issue Public Safety really trumps anything else that you might want to do if you think back to that word soup I showed earlier about Unstoppable and self- Sovereign and trustless Free Speech all that is really trumped if it somehow endangers Public
(09:32) Safety right so successful investments in web 3 I believe are going to be in projects that address or avoid deceptive malicious or illegal activity so free speech has its limits right the idea of the web three being uncensorable or unstoppable that's not that has limits you can't yell fire in a prowed there so what does that mean from an investment thesis in my mind we're not we're not going to get to true decentralization there's no such thing as being truly uncurable or truly Unstoppable and in fact Unstoppable
(10:15) domains is finally realizing this as well and the whole idea that ownership shall not be infringed that's fine to a point but but if it starts to endanger Public Safety then it's not going to be realized so here's an example of what I call DNS abuse you may be familiar with a kids game called Roblox right when I grew up I played with linol logs when my kids grew up they played with Lego kids nowadays play with Roblox right so it's an online building game really aimed at five six seveny old kids okay very successful business
(11:00) so let's look at how what happens on handshake for Roo so I have a a a search engine where I I look at all the handshake names and I do the same for ens and Unstoppable and I know you can't read this but there's there's several hundred names in handshake that contain Roblox so for example the first one here is Roblox Port uh there's Roblox scripts by Roblox right Ro Roblox games Roblox fans Roblox core Etc and this this goes on for Pages now don't forget the audience for Roblox are six seven eight year old kids okay
(11:45) so this is an example of DNS abuse it's not the exact trademark which maybe they claimed or maybe it's on auction we don't know but these are variants that are intended to deceive or Miss mislead the public in this case kids all right and so obviously I don't have these names but if you're Associated you know just being part of the the community this is not good for the project and it's not limited to handshake the same problem exists with ethereum naming service.
(12:23) eth the same problem exists with the the 10 or 12 Unstoppable domain tlds they all have this problem where there's a segment of the community that is really doing DNS abuse and endangering in many cases uh kids or public uh in in doing so and so the investment thesis has to be well if I want to see I want to commercialize or monetize my investment this is not good if I want to see a 10x exit from on my investment right this is needs to be fixed and it's not it's I can go on Tesla hundreds of handshake tlds
(13:07) containing Tesla Google hundreds of tlds containing Google all these really intended to impersonate another company right so it's part of what I what I think is unacceptable use of web 3 domains so my investment thesis is I want to follow some standards for responsible DNS integration I think that the successful web3 naming projects will support Public Safety by addressing DNS abuse and we already see it happening in several areas name base which obviously operates at the largest handshake registry they are
(13:55) incorporating uh the uniform domain name dispute policy into all their tlds so they are they are they realize that if they're going to realize a return on their investment they have to address DNS abuse for the handshake tlds that they are managing Unstoppable demands I saw them last week at the Ian meeting they plan to apply to be Ian accredited they plan to incorporate into their smart contract a dispute process so you're seeing this this pivot of people saying we want to be successful with our investments and the only way to get
(14:34) there is by cleaning up our name space and making this safe for the public to use U there's a potential web three dispute process it's it's this is just a high level design I don't want to get into that but I you know my final point is from an investment thesis I think web3 investors they want to see a return on their investment they have to start getting pragmatic the ideals of of this lab experiment have to be somewhat curtailed if you want to see this gain uh mainstream acceptance so I'll stop there happy to
(15:17) talk about specific trademark questions and give J to talk as well yeah hey Tom those are some excellent points and uh I think so there's there's actually the you know the way that we do it in web 3 to authenticate names which is like on salana for example there's a bunch of salana and then it's just like you could have you know Dolan trimp Donald Trump Maga token Rich Nick you know uh Nick with a c Nick with a CK all of these tokens but then the authoritative um part of it is the contract address so then so we actually
(15:55) do have this like um uh fishing resistant uh primitive directly on the blockchain already it's a matter of building a layer on top of it kind of like a UI layer or some kind of social layer that orchestrates um and and acts as the authoritative layer to let people know which is the true name like the same the same primitive exists on handshake so um there is not a there is like a verifiable way on chain for people to understand which is the true name and which is like some derivative uh you know like probably
(16:34) fishing name so I I think that like the we need to build some kind of like a knowledge bridge for people in web 2 to understand how it works in web 3 and for web 3 to build that orchestration layer for people to understand uh which is you know wh which names have like a little social check mark and which are not yeah greate yeah yeah so the the web two dispute process may not be fit to purpose here there may be other reputational mechanisms that make sense I I I'm all for that but I just have I'm Happ to think in terms of my investment
(17:15) thesis I think uh the most likely path to success or acceptance by the mainstream is something that allows uh trademark owners and other and other types of DNS abuse to get be addressed so it becomes trusted by by consumers yeah yeah definitely there there's got to be a lot of um social coordination work between the two basically like the two different verses because we we like I think like web two and web 3 people live in like different servers like we're in different metaverses and there needs to be I I
(17:50) think I think between you and me Tom we're we're kind of like the defao bridges between these two worlds you're kind of the um web 2 Advocate teaching web 3 to to the I can people and traditional domainers and me I'm kind of like dabbling trying to go to your events and like speak to traditional domainers to understand where where your head is at and so that in order so that um we in web 3 can speak the same language absolutely yeah so I mean there's a lot of quotes here people you know don't want to bring Web Two law to
(18:24) web 3 uh it's it's one internet guys and it all runs on DNS uh there is no there is nothing where you can you can a avoid jurisdictions or or legal issues uh if if you know they if they want to they will come after web 3 right so far they have not been concerned uh I mentioned I was on the the names Collision project at IAD as far as they're concerned there are no collisions they don't exist uh and uh you know they will go it's interesting in the next round there'll probably be maybe one or 2,000 new tlds I can tell
(19:02) you 100% of those will collide with web 3 tlds but you know handshake will have what 12 15 million by that and it's not going to be material to handshake uh but those one to 2000 I can tlds will get recognized in all the bres yeah there's there's a there's a project called D3 and they're they're doing that work to bridge between the two um but then I think that they're the work that they're doing is important because they're actually getting the uh opt in from web 3 names such that they
(19:37) could register in I can and for it to work on on both so that there's no Collision um so I think this this type of pioneering is needed in the web 3 space to work with I can right and to you know and it's important for handshake as well to be recognized as a legitimate project in the eyes of Ian which is the um the incumbent so um yeah having conversations like these is important and it's yeah we I think we all understand that it's not just the wild west anymore we have to we have to work with uh the incumbent
(20:14) system also funny story funny story about um do music so so I I was talking to Constantine and he was he was so upset I was talking with him and um and uh Paul stara from uh from donuts for the owner of Di iio and the hundreds of other tlds and then uh yeah like Constantine was so upset about music and we were like okay like let's let's let's let's look for the owner for you right so then we did we did like a crowdsource search in the handshake Community to figure out who the owner was um he was
(20:48) Anonymous and then um we needed and then at some point um Constantine because he he needed to do taxes and Reporting in the US you you know he needed some uh like I legal custodian in order to in order to like arbitrate that deal because he couldn't he couldn't just directly use crypto to buy that um by that domain right there were a lot of other legal hurdles he had to jump through uh and so that effort took multiple months until Tom youu came in and kind of saved the day because you were able to act as that bridge um but
(21:28) hopefully that's like that's one giant Collision that's been resolved now um and I think that was the main one hopefully there's not more yes and and so um yeah collisions are interesting as I say the the way I can measures collisions it's it's traffic at what they call the root servers so a lot of the web3 projects don't appear on the radar at all when they when they look at collisions so they'll have to come up with a different metric to determine uh if there's a if there's a
(22:06) collision and certainly collisions between different web 3 projects you know they don't care they don't care about that at all right right and that's why it's up to us to resolve those collisions within our own domain as well yeah so I'm looking at the the the chat here the last comment by John is you know why doesn't Google resolve H&S domains and I and I think I I tried to address that it's a public safety issue they do they do know any more than why isps are not going to let you resolve
(22:40) web 3 domains um this is the you know we already have seen some some people may be aware that people are dying of counterfeit drugs right drugs that they think is a painkiller it's laced with fentanyl what have you uh and so you that's an extreme case obviously but the the public safety issue is is at top of wine and so folks like Google like Cloud flare um they need to be assured their invest their investors need to be assured that uh consumers and the public are not going to be harmed if they start
(23:17) resolving these things I mean I money thing too right it's I think I'm not C A lot of them need payment for Integrations I'm not saying those specifically but some browsers are their monetization model I've learned is is payment for Integrations as well yeah and the other thing is it I mean so so to to people in the I guess uh the traditional domain space handshake looks like it's dangerous but in fact when you dig into what it looks like technically it's actually more secure safer than any you
(23:55) know web 2 domain any any people who are signing with SSH keys and all that like like 10 you know 20 1024 RSA keys and all that you know it's like it's like way less secure from a technical standpoint it's just a matter of educating people in the traditional domain side to understand that this technology um is much more sophisticated than than because because it's like one of those things it's like oh the unknown unknown right so the scary thing is like well this is not something that I understand therefore I think that it may
(24:26) be you know perceive it as Les safe than um what I'm used to when when objectively that's not the case so it's a question of uh Us in the web 3 space being able to educate people in the web two space and doing that kind of Outreach you know unfortunately Unstoppable domains actually is like one company that does recognize the importance of doing this work a lot which is why they're doing so much like lobbying of the web 2 space um I more of that needs to be to be done from handshake the only downside with
(24:58) handshake is it's completely decentralized and so it's like a multi-headed Hydra where you know many of us come at it come at your you know the I can conferences from many different angles and you don't actually know who the leader is that's by Design um and that's the tradeoff but strictly speaking um handshake is actually more more um secure and robust like at the protocol level yeah so it's you know so it's it's an exciting project uh it still has I think a ways to go before it it uh gains
(25:35) some acceptance uh but it's a it's been it's been a fun ride so far yeah yeah it's one of those things where you know people in the hen Community are trying to Lobby um you know traditional domain uh like like people who own you know large tlds uh Lo like doio to up update their keys to like 20 48 bit keys right so that's going to be safer and that way it also allows um people to use Dane and resolve handshake names directly in the browser without needing any s any sort of like high high overhead from um from
(26:10) like Integrations from from like browser Integrations that that are like pay to play but that's like a very long-term game yeah and I saw I saw that question flash up on the screen I know we're running out of time uh but I I would you know I would go back to my my real simple definition of DNS abuse um there there are a lot of dictionary words out there that are obviously trademark and and for particular goods and services uh and and so as long as your intent is not malicious deceptive or misleading uh and
(26:47) it's a dictionary word you're using it in a descriptive sense you are safe but as soon as as soon as you start to try to impersonate or mislead anyone then you've got a a DNS abuse issue so if you have a famous trademark combined with the word Corporation or support I heard I heard someone say Microsoft support you know don't touch that that's not a great idea you're clearly the only I me the only intended use of that is to impersonate Microsoft support why do you think that's good for the project it
(27:23) really isn't yeah it's not it's I think some people think it's funny there is some fun I mean you know some but it's not you know we shouldn't we have to mature as a community I think you know I think earlier the first couple years there was a lot of fun that was being done but it's it's not really yeah I mean that's of course it sounds funny to me I kind of chuckle but yeah I mean it could obviously be used for bad things like um you know tricking people a lot of people don't know how to use the internet
(27:50) people don't even know how to use Google or Amazon right they just click the first ad and they just buy they a lot of bad stuff happens on Twitter ads you can see or or Google ads people click the ad and they they connect their wallet and get drained because they think it's another you know people are not as as smart as we think you know making so we just got to be careful um about what we do as a community um and I tell you you know the rug plls that we've seen with crypto has really made consumers
(28:19) skittish about getting a wallet about going through that that whole process of buying crypto and so I'm really focused on onboarding newcoms and and these are these are hurdles serious hurdles to overcome if we want to see larger acceptance agreed you know I mean Bitcoin you know everyone's talking about Bitcoin I mean Bitcoin was 2008 right it came out yeah I mean I I I mean it took a long time a long time you know I mean it was still four years for handshake I think some people be sharing about that later in some of the sessions
(28:53) but you know it takes takes time especially in such a decentralized form but we have I think the main point of the session is please everyone just try to respect trademarks I know maybe you can get away with it you can squat on these names or you know Etc and try to but you're wasting money because they're never gonna buy these names they they would rather spend several hundred, trying to crack you down and give you a thousand bucks and that's that's the reality so it's not it's not a it's not
(29:21) a good investment um so I'm gonna I know there's been a lot of questions in here I'm going to throw my email address in the chat if you want if you got a specific question I'll be happy to correspond with you via email yeah thank you Tom I always appreciate you I think it has been every single year you shared here so uh and you're active in all all the a lot of the events that I see online um in web to web 3 so I appreciate uh your your work to try to keep these two uh bridged and um well
(29:53) it's fun we'll see you guys around all right thanks Tom and thank you Chango it's been fun Tony mantana in the back with your your Shades you'll also be on the on the auction in a couple days too I always enjoy it look great we're having fun you know we have some fun here w wow wow yipp yipp the w wow [Music] w