Some domainers have been participating in premium expiring domain auctions on different marketplaces only to make those who can afford to pay a premium on such domains, checkout with a higher bill.  The implications that result from this tacky activity are devastating.  I was recently chatting with a domain investor who confirmed that they’ve heard people doing this quite often just because they couldn’t afford to get the name, so they thought it would be best that others (who could afford) pay a higher price.

Unfortunately, domain marketplaces haven’t done much to shield legitimate investors from those malicious bidders.  Auctions on NameJet.com, for example, display bidders’ aliases.  One could easily know the bidder behind a specific moniker by associating the bidding alias with the information under WHOIS once the domain is transferred to the winner.  Future auctions could then be bid up once a high profile investor is identified.

Many sales quotes are based on previously sold domains (including those purchased from the auction).  When domain auction prices are inflated due to the mentioned activity, such domains reflect an inaccurate market valuation for other similar names.

The true winners in this game are of course marketplaces, as they fetch higher prices on their domain inventory.

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