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With the sunrise period for the .luxe domain soon coming to an end, Sheri Falcon of Minds + Machines Group discusses efforts to bridge potentially obscure cryptocurrency activities happening on the dark web with the regulated surface web.
Intellectual property lawyers and brand managers have probably heard references to the “dark web”. Some will know that the dark web is an “underground” medium that allows for the distribution of harmful information as well as for the browsing and purchasing of illegal good and services.
However, in order to better understand the dark web and its trademark and brand protection vulnerabilities, we need to distinguish between the “surface web”, the “deep web” and the “dark web”.
The surface web is anything searchable via typical search engines such as Google, Bing or Yahoo, ie, what most people refer to as the internet. The deep web consists of sites or links that are not available via search engines, but are generally not illicit or illegal (such as password-protected government databases, encrypted corporate networks, etc).
The dark web is a small section of the deep web that has been intentionally hidden. It requires a special browser such as Tor or the Invisible Internet Project (I2P) to access it. There are hidden marketplaces and websites on the dark web that allow interested parties to buy and sell any product or service imaginable, including illicit drugs, hacking software, counterfeit goods, etc.
While it is true that there are many sites on the dark web that are established solely for the purpose of illegal transactions, there are numerous positive uses of the dark web as well.
Examples are decentralised communications that boost anonymity (for political purposes or freedom of speech expressions), as well as legitimate transactions that capitalise on cryptocurrency, or blockchain innovations.
Cryptocurrencies are digital assets designed to serve as a medium of exchange. Bitcoin, which is built on blockchain technology, is the largest cryptocurrency as it was the first to launch; since then more than 4,000 different types of cryptocurrencies have been developed.
“Ensuring brand protection across all Ethereum-based assets through the cost-effective ease of an ICANN-regulated domain name is like landing on the moon and placing your country’s flag there.”
Blockchain technologies, also known as distributed ledger technologies, allow for more than just the creation of cryptocurrencies. Blockchain technologies are used by companies and developers across the globe to build new systems and initiatives, the most successful of which is Ethereum.
Ethereum is the second largest cryptocurrency in circulation, with millions of Ethereum-based ‘cryptowallets’ in use.
In addition to cryptowallets, a quick review of the decentralised app (Dapp) store State of the Dapps reveals that there are approximately 1,900 Ethereum-based Dapps and almost 9,500 daily users accessing those Dapps.
The Dapps cover a range of products including cryptocurrency exchanges, games, data storage, health services, smart contracts, and of course, the collection and breeding of digital cats, all of which operate on Ethereum technology.
In an effort to create more transparency and ease of use, the key holders of Ethereum created the Ethereum Name Service (ENS), which was designed to provide a secure and decentralised means to address resources both on and off the blockchain using simple, human-readable names.
The ENS allows more people (not just sophisticated computer types) to participate in this emerging technology. The ENS launched its own domain extension (.eth), which allows individuals and organisations to acquire human-readable domain names (versus complicated, 40-character strings) on the ENS.
Although its intent was pure, because the ENS is not regulated by the governance framework most consumers and brands have come to trust (ie, the Internet Corporation for Assigned Names and Numbers [ICANN]), thousands of trademarked names have already been registered in the .eth registry.
Because .eth is not regulated by ICANN, trademark owners do not have the same recourse to methods to pursue infringing .eth domain names. In other words, established dispute resolution services like the Uniform Domain-Name Dispute-Resolution Policy (UDRP) and the Uniform Rapid Suspension System (URS) are not available for .eth names.
Moreover, it is technologically sophisticated and rather labour-intensive, assuming it is even possible to do, for brands to identify the actual registrant’s name or location of a .eth name, which makes pursuit of those names complicated at the least.
Many brand managers may not even be aware that their marks are being used as domain names in .eth. As such, trademark owners are essentially allowing their marks to be misused for any variety of transactions on the dark web.
Typically, brand monitoring services do not monitor the dark web. Although there are some services that offer dark web monitoring, they tend to focus on stolen customer data obtained via hacking, malware or phishing and can charge their clients up to $150,000 per year.
If a trademark is being used in a .eth domain name without the trademark owner being aware it exists, there is clearly a significant risk that the owner of the .eth domain name can purport to offer the brand’s cryptowallet, or enter into financial transactions or smart contracts, allegedly on behalf of the entity.
As any brand manager knows, this negatively impacts the trust and legitimacy of the brand itself. Any material on the dark web that incorporates even just a logo immediately portrays the entity as a target for other more nefarious activities.
Companies that are not protecting their marks in cryptocurrency transactions on the dark web may be perceived as an unsecure entity and easily targetable, which could hinder future funding, investor confidence and lost customers.
Businesses exploited by these types of transactions on the dark web are therefore also vulnerable to exposure on the surface web, ie the everyday internet.
Fortunately, an ICANN-regulated top-level domain has been launched. Its intent is to bridge potentially obscure cryptocurrency activities happening on the dark web with the regulated surface web/internet. That domain extension is .luxe.
Trademark owners seeking to create a legitimate presence in the cryptocurrency environment can now acquire a .luxe domain name and link it directly to any Ethereum-based product or service, including Dapps, wallets, and smart contracts.
For example, if a bank launches its own cryptocurrency, it can use bank.luxe to trade that currency in both the surface and the dark web at the same time. This serves multiple purposes, one of which is to ensure that no-one else is using that bank’s name to offer its own, unauthorised, cryptocurrency.
Ensuring brand protection across all Ethereum-based assets through the cost-effective ease of an ICANN-regulated domain name is like landing on the moon and placing your country’s flag there. It lets others in that space know that you have arrived, your brand is protected and you have a sophisticated team of advisors ensuring that your mark is not being used for nefarious purposes.
Brands seeking to participate in the Ethereum-based opportunities can ensure their marks by registering a .luxe domain name during the .luxe TMCH sunrise period, which ends on October 8, 2018.
Starting the next day, any .eth domain name owner can register the directly matching names in .luxe and, soon thereafter, any registrant can register a .luxe name.
Once a .luxe name is registered, the owner of that name can easily link its existing wallets, Dapps and other Ethereum-based assets to their .luxe name and transact in that name. In other words, very soon, mainstream consumers will start seeing brand names in .luxe that have the appearance of legitimacy; those .luxe names will be able to transact business on both the dark and the surface web.
As a trademark owner, you will want to make sure that the .luxe name matching your trademark is actually owned by you.
Visit join .luxe to find out more.
Sheri Falcon is general counsel at Minds + Machines Group, the registry operator for .luxe.
brand protection, .luxe, Sheri Falcon, Minds + Machines, dark web, sunrise period, trademark, Google, Bing, Yahoo, blockchain, blockchain technologies