Final thoughts on ‘liquid domains’

By now, the subject of so-called “liquid domains” has been covered ad nauseam.

My recent position on the subject generated a lot of interesting commentary, for and against the existence of this domain genre. Personally, I believe that it’s a unicorn of sorts.

Elliot’s blog featured a “free for all” listing of 3-letter and 4-letter .com domains, for domain investors seeking to liquidate them.

Although that post has been removed, it can still be viewed via the Google cache. I’m not going to provide the link, as Elliot must have had some valid reasons to remove the post entirely.

More than 100 LLLL .com domains were listed; asking prices ranged from about $135 to $20k or more. I actually saw some domains with potential, and was pleasantly surprised seeing domainers seeking considerably higher prices for their quality domains. However, that beats the “liquidity” concept of selling domains below market value to obtain quick capital.

I did not witness any signs of interest, announcing “sold” but perhaps something transpired in private.

The bottom line is that without the proper audience one cannot sell such “liquid domains” even at registration fee.

Which brings back the issue raised by Andrew of Domain Name Wire about creating an environment establishing and sustaining domain liquidity.

Many comments in that exchange, including some by Frank Schilling, indicate that the currently available marketplaces underperform.

A solution might be to reinstate formerly available “domain pawn” services, but don’t expect to get more than 50% of a domain’s street value at such venues either.

As a final thought on the subject of liquid domains, one needs to balance their ability to maximize their ROI with the ability to sell quickly at a time of crisis. As these are inversely linked, knowledge on how to achieve that comes with time and by studying the overall domain market and its activities.

 

Comments

  1. Didn’t see your comments, my apologies I’m pretty busy lately, but I know from your past postings there’s at least a 75% chance you’re right… I have not been following what must be a fairly recent conversation on domain liquidity either.. so with that in mind:

    This is topic I’ve been beating like a dead horse for years so here I go again:

    Liquidity is manufactured in lucrative commodities to facilitate trade where intrinsic value is recognized but not immediately available to be capitalized upon.

    It’s a mouthful, I know. Think of it like this: stocks are not (primarily) bought and sold between individuals or even entity:entity, transactions are usually facilitated through “market makers”. Entities that are trusted to be middle men. They intimately know the value and potential downfalls of the securities they deal in. They stockpile from sellers when the price is below (what they feel) is intrinsic value and they sell their positions to those more bullish when the tide turns. Without market makers and specialists the entire (worldwide) economy would grind to a halt and crumble b/c *someone* has to be ready and available when a sell order is placed even though the “end user” hasn’t woken up yet.

    The financial world has this all figured out yet domainers wonder why the properties they *know* are lucrative sit on a shelf for years, tying up capital.

    We as an industry have the collective expertise, capital and foresight to craft an equitable system of domain liquidity.. we have the desire.. do we have the will?

    Several years ago I corresponded with Neal Voron, Tobias Ratslinge and even Rick Schwartz regarding a concept called fractionalization and I still believe this is the future of “Ultra Premium” domains and also lower valued domains. I’m open to discussing this concept in detail with anyone interested.

  2. Very interesting perspective since others do believe there are names that can be considered extremely valuable and are “Liquid”. I believe you can definitely liquidate any name with some sort of value but it just won’t be at the price you want if you are looking for a quick sale.

    Maximizing the ROI on a domain may take some time and many people simply do not have the patience.

    I agree when you mentioned that there has to be a balance. You must have some domains with higher value to hold and maximize the ROI but also have domains that you will be able to liquidate at a good profit and sell them quickly.

    – Will

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