For years, domain investment has been driven by one major force: startups. So did the demand for Premium.com and brandable domains when new companies launched. However, in 2025, its engine has stalled and domain sales have crashed.
The industry-wide, domain investors have seen a sharp decline in enquiries and sales. Even Hugedomains, one of the largest owners of the aftermarket domain, has expired hundreds of thousands of names. Question about everyone’s mind: What has changed?
How AI, Startup Behavior, and Funding Crunch Are Crashing Domain Sales Crash in 2025
The answer lies in the evolving startup landscape.
Founders are now built differently. Thanks to AI tools like ChatGpt, Gemini, and Prperxity, the way people search and discover their businesses has changed fundamentally. Domain names, once considered digital front doors for startups, are just one of many entry points.
At the same time, it means fewer founders pay a premium for domain names with a lean budget, smarter buyers and easier naming tools. The domain market is not just a cooling, it’s been revised.
1. AI Effects: Changing the way people search
AI tools are changing the way people find information online. Instead of entering keywords into Google and clicking on search results, users are directly asking for AI chatbots. This shift erodes the exact match keyword domain values that previously benefited from organic search traffic.
AI also affects the naming process of startups. Tools like Namelix, Squadhelp, and even ChatGpt help founders generate brand domain names in seconds. Many of them can be registered at standard prices.
2. Lean startup mentality: less and faster
Startups will be more modest in 2025. With venture capital tightening, founders are reducing unnecessary costs, and expensive domains are being cut first.
Instead of spending $5,000-50,000 on a domain, you’re booting with what’s available. That means using .io, .xyz, or slightly longer.com. More importantly, the time to market, the fit of the product market, and the building of the audience.
3. Smarter buyers, better tools
Buyers today have more information and have more tools. They can:
Use a domain name generator. Monitors the expired domain itself. Tap AI to find a creative workaround.
Unless your domain is truly premium, you no longer have to resort to the market or broker.
4. Domain Portfolio Accumulation
Suitable case: hugedomains.
One of the largest domain markets, Hugedomains has removed nearly a million domains from its portfolio. Overseeing a large portfolio of the .com domain, the company quietly began to expire by hundreds of thousands.
In December 2023, the registrar managed nearly 6 million .com domains. By December 2024, the latest month with available data – that number had dropped to just 5.1 million. Many of these expired domains have emerged on Dropcatch, a sister platform owned by parent company Turncommerce.
Why the shift?
It’s expensive to hold millions of domains. With a standard renewal fee of around $10 a year, a $1 million portfolio costs $10 million a year just to maintain. As sales slew rates drop and competition from AI-generated names rises, returns no longer justify costs.
“In recent months, activity has declined significantly at Turncommerce, the company that runs droppcatch.com. In addition to providing domain drop catches to customers, the company has acquired many domain names in its Hugedomains portfolio.
The numbers show a sharp decline in activity. In December 2023, the registrar had a .com domain of nearly 600,000 people under its control. In December 2024 (the most recent month when data is available), there were just 5.1 million .com domains,” Domainnamewire wrote.
This is a clear signal that even the biggest players are reevaluating their strategy. Quality is more important than quantity.
In addition to this trend, Nametra, a veteran domain with over 1,200 domains, has recently been shared by X.
“I’ve been experiencing one of my worst years with 26 years of domain investment. Despite a lot of lead @Afternic, there hasn’t been a domain sale since January. I had one LTO deal ending by default for buyers. Last year was bad, but this year it’s bad.
Nametra’s post reflects growing dissatisfaction among long-standing investors. It’s a market that is unpredictable, with a decline in buyers, a decline in sales.
5. From boom to reset: fixes after 2020
Behind the rise of e-commerce growth, crypto hype and the rise of remote startups, domain sales surged from 2020 to 2022. But now we’re on a post-boom hangover.
The economic situation has changed. It’s difficult to develop capital. And the technology world is focused on launching new brands, with emphasis on integrating existing brands.
What should domain investors do now?
This reset is not over, but it’s a call to evolve.
Here are the smart domain investors for 2025:
Trimming a portfolio. It focuses on brand names with high quality. Explore AI naming tools to stay ahead of trends. A good look at the startup space to predict demand.
The domain market is not dead. It’s just growing.
And, like all mature markets, the winner will be the winner who adapts early.
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