EXCELLENT ADVICE: Due diligence is necessary before buying liquid domain names


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Take these extra precautions when buying a valuable domain name.
With news yesterday of more missing three letter domain names at a couple different domain registrars, now is a good time to remind people about due diligence when buying a domain name.
This is especially important for “liquid” domain names like three letter domains. Three letter domains have a floor value at which they can be quickly sold to a ready market of buyers. This makes them a favorite of thieves.
Here are some considerations if you’re buying a liquid domain name:

  • Check the whois history for the domain for at least the past year to see if there are any ownership changes. Thieves usually try to unload domains in a hurry (hence their interest in liquid domain names). If ownership has changed, contact the prior owner to make sure the domain wasn’t stolen. You can check whois history on sites like DomainTools and DomainIQ. I personally narrowly avoided buying a stolen domain many years back by calling the previous owner.
  • Consider how the seller sold the domain. Domains listed for quick sale on forums or emailed solicitations are worrisome, unless they come from a reputable broker you’ve worked with in the past.
  • If it seems to good to be true, it probably is. If someone is offering a good combination of three letters for under $10,000, something is wrong. Even $20,000 is too low in many cases.
If you own valuable domain names, especially liquid ones, you need to take a few precautions as well. You are constantly a target.

  • Use two-factor authentication at your domain name registrar. If your registrar doesn’t offer two-factor, switch to a registrar that does.
  • Consider additional security services offered by your registrar. For example, whenever I transfer a domain to another party, GoDaddy calls me to get a verbal verification password. Yes, transfers are slower this way, but it’s worth it.
  • Use a domain monitoring service to be alerted to domain changes in your portfolio.
  • Don’t use the same password at more than one registrar. If one is compromised, then both are compromised.
Due diligence is necessary before buying liquid domain names | Domain Name Wire | Domain Name News & Views
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