Problems with .xyz Domain Extension [Spam, Malware, and More]

Should your company use .xyz domain as a substitute for traditional domain extensions such as .com, .net or .io? Let’s find out.

There are several reasons why businesses should know about using XYZ extension. Its utilization can adversely affect its online visibility, result in blacklisting, and give rise to a surge in corporate emails going to spam. A collection of case studies will exemplify the dangers associated with it.

Let’s explore the good, the bad, and the ugly of XYZ domain extension. There is a lot to unpack. Should your startup or project use xyz? Why or Why not?

Just a few days ago, Yuga Labs, the company behind the massively popular NFT project Bored Ape Yacht Club had issues with launching their new game on .XYZ domain extension due to firewall blocking of XYZ by the hosting provider.

Forcing the Bored Ape Yacht Club project to delay the launch. That has resulted in financial losses, erosion of customer trust, and ultimately still having to save the situation and launch on a .com. Any project in web3 and tech space should know the dangers of building on xyz domain.

The founder of XYZ domain is sued by FTC and settled for 1.5 million for selling customers’ data illegally.

Let’s explore the ethics or lack thereof of XYZ founder Daniel Negari. Whose company just recently settled with FTC, for selling millions of customers’ privet data (Such as phone numbers, home addresses, emails, and even social security numbers).

Daniel Negari and top executives of .XYZ domain agreed to pay $1.5 million to settle FTC lawsuit for “deceptively” harvesting personal data of millions of consumers. — TechStartups

Yet, that is just the top of the proverbial XYZ iceberg regarding XYZ domain problems.

Let’s explore the key issues with the .xyz extension in detail:

  • Association with spam and fraudulent activity
    Many hosting companies and email providers mark emails sent from .xyz domains as potential spam, which can lead to decreased deliverability and a lower chance of reaching potential customers. Additionally, .xyz domains are often used by cybercriminals to create phishing sites and spread malware, which can harm the reputation of businesses that use them.
  • Lack of recognition and trust
    The .xyz extension is not widely recognized or trusted by customers and other businesses. Many people may view a website with a .xyz domain as less credible or professional, which can negatively impact the perceived value of a business. This can make it harder for startups to establish trust with potential customers and partners, making it more difficult to grow and succeed.
  • Increased security threats
    .xyz domains are more vulnerable to security threats like ransomware. Microsoft defender for cloud is one of the examples which marks .xyz files as potential ransomware and impacts the business’s reputation.
  • Silent but very real problems for startups
    Many startups may not be aware that their customers are not receiving their emails due to the use of .xyz domains, which can lead to lost business opportunities and revenue. This silent killer can make the .xyz extension extremely dangerous for any project looking to grow. Here is a case of why it can be so costly to build on xyz.

Since launch in 2014 .XYZ domains have taken off and today it’s a domain of choice by blockchain companies, scammers, and hackers. You can read more about “why hackers love .xyz and other new top-level domains.” – F Secure

While the .xyz domain extension may seem like an attractive option due to its cheapness, businesses need to consider the potential drawbacks of using it.

Let’s use another startup-friendly extension to benchmark how bad xyz domain extension spam is. Spamhouse tests showed that .io extension is 11 times safer than xyz. In other words, your chances of being marked as spam, malware or other problems is 1100% higher if you build on XYZ, vs .io. Want to use a more traditional extension? Using other established extensions such as .org , .com or .net are significantly safer than XYZ according to SpamHouse.

Recently XYZ extension was also called out by Google engineers for SEO ranking problems.

Remember that lousy domain will keep hindering your startup growth as long as your company is alive, so make sure to avoid dud extensions when selecting the proper extension for you from the very start. And the larger you get, the more extension problems hurt your project. Every step is easier when building on the right extension from the start.

The FTC said that the top executives of .xyz domain, through a network of interlinked companies, deceptively collected loan applications through at least 200 websites, and promised to connect the applicant with verified lenders. Instead, they sold the personal data indiscriminately” to the highest bidder through a lead-generation marketplace. – FTC.GOV

The association with spam and fraud, lack of recognition and trust, and increased security threats can all make it more difficult for a business to succeed online.

It’s always better to invest in a domain extension that is well-established and widely recognized, such as .com or more tech focused .io, to ensure the best chance of success.

Paul Lennie

Paul is a Scottish finance expert who moved to New York in 2002 to trade on Wall Street, and has been a blockchain and cryptocurrency advocate since 2013. He is a well-respected member of the global blockchain community, and has worked with banks and other large corporations on integrating blockchain technology into their businesses.