Why domain sales are crashing in 2025: How AI and a shift in search behavior are reshaping the domain market

For years, domain investing was fueled by one major force: startups. As new companies launched, so did the demand for premium .coms and brandable domains. But in 2025, that engine is stalling—and domain sales are crashing.

Across the industry, domain investors are seeing a sharp drop in inquiries and sales. Even HugeDomains, one of the largest holders of aftermarket domains, is letting hundreds of thousands of names expire. The question on everyone’s mind: What changed?

How AI, Startup Behavior, and Funding Crunch Are Crashing Domain Sales in 2025

The answer lies in the evolving startup landscape.

Founders are building differently now. Thanks to AI tools like ChatGPT, Gemini, and Perplexity, the way people search—and the way they discover businesses—has fundamentally shifted. Domain names, once seen as a startup’s digital front door, are now just one of many entry points.

At the same time, leaner budgets, smarter buyers, and easier naming tools mean fewer founders are paying a premium for a domain name. The domain market isn’t just cooling—it’s correcting.

1. The AI Effect: Changing How People Search

AI tools are changing how people find information online. Instead of typing a keyword into Google and clicking through search results, users are asking AI chatbots directly. This shift is eroding the value of exact-match keyword domains, which previously benefited from organic search traffic.

AI is also influencing the startup naming process. Tools like Namelix, SquadHelp, and even ChatGPT are helping founders generate brandable domain names in seconds, many of which are available for registration at standard prices.

2. The Lean Startup Mentality: Spend Less, Ship Faster

Startups are more frugal in 2025. With venture capital tightening, founders are cutting unnecessary expenses, and expensive domains are among the first to go.

Instead of spending $5,000–$50,000 on a domain, they’re launching with what’s available. That could mean using .io, .xyz, or a slightly longer .com. What matters more is time-to-market, product-market fit, and audience building.

3. Smarter Buyers, Better Tools

Buyers today are more informed and have more tools. They can:

• Use domain name generators.
• Monitor expiring domains themselves.
• Tap into AI to find creative workarounds.

They no longer need to rely on marketplaces or brokers unless a domain is truly premium.

4. The Fall of Domain Portfolio Hoarding

Case in point: HugeDomains.

HugeDomains, one of the largest domain marketplaces, has dropped nearly a million domains from its portfolio. Once overseeing a massive portfolio of .com domains, the company has quietly begun letting hundreds of thousands expire.

In December 2023, its registrars managed close to 6 million .com domains. By December 2024—the latest month with available data—that number had fallen to just 5.1 million. Many of these expired domains are now surfacing on DropCatch, a sister platform owned by parent company TurnCommerce.

Why the shift?

Holding millions of domains is expensive. With a standard renewal fee of around $10/year, a million-domain portfolio costs $10 million annually just to maintain. As sell-through rates drop and competition from AI-generated names rises, the return no longer justifies the cost.

“In recent months, there has been a notable drop in activity at TurnCommerce, the company that operates DropCatch.com. In addition to offering domain dropcatching to customers, the company acquires lots of domain names for its HugeDomains portfolio.

The numbers show a steep drop in activity. In December 2023, its registrars had close to 6.0 million .com domains under management. In December 2024 (the latest month for which data is available), it had just 5.1 million .com domains,” DomainNameWire wrote.

This is a clear signal that even the biggest players are reevaluating their strategies. Quality now matters more than quantity.

Adding to this trend, Nametra, a veteran domainer with over 1,200 domains, recently shared on X:

“I’m experiencing one of my worst years in 26 years of domain investing. I haven’t had a domain sale since January despite lots of leads @afternic. Had one LTO deal end on buyer default. Last year was bad, but this year is worse. Anyone else seeing the same? #StayPositive”

Nametra’s post reflects the growing frustration among long-time investors: fewer buyers, fewer sales, and an unpredictable market.

5. From Boom to Reset: The Post-2020 Correction

From 2020 to 2022, domain sales soared on the back of e-commerce growth, crypto hype, and the rise of remote startups. But now, we’re in the post-boom hangover.

The economic climate has changed. Capital is harder to raise. And the tech world is focused less on launching new brands and more on consolidating existing ones.

What Domain Investors Should Do Now

This reset isn’t the end, but it is a call to evolve.

Smart domain investors in 2025 are:

• Trimming their portfolios.
• Focusing on high-quality, brandable names.
• Exploring AI naming tools to stay ahead of trends.
• Watching the startup space closely to anticipate demand.

The domain market isn’t dead. It’s just growing up.

And as with all maturing markets, the winners will be the ones who adapt early.