A Strong Start to 2026 for the Domain Industry — and a Clear Warning for Registrars

As 2026 begins, the global domain name industry finds itself at an interesting inflection point. On one hand, growth indicators are stronger than even ICANN anticipated just months ago. On the other hand, ICANN’s compliance actions in early January send a clear signal: growth without governance will not be tolerated.

Taken together, recent developments paint a realistic picture of where the industry is heading — commercially optimistic, but operationally unforgiving.

ICANN’s Revised Budget Signals a Healthier Market

ICANN’s draft FY27 budget, published shortly before Christmas, reveals a significantly more bullish outlook for the domain industry than earlier forecasts suggested. The improvement is not merely a result of increased registry and registrar fees, but rather a genuine rise in domain name transaction volumes across both legacy and new gTLDs.

For FY26, which ends on 30 June 2026, ICANN now expects:

• 187.5 million legacy gTLD transactions, up from an earlier estimate of 179.8 million — a 4.3% upward revision

• 43.1 million new gTLD transactions, revised sharply upward from 33.1 million — a 30.2% increase

According to ICANN, this growth trend became visible in the second half of FY25 and has continued consistently since then, supported by positive guidance from across the industry.

As a direct consequence of this stronger-than-expected performance, ICANN now projects $161.4 million in operational funding for FY26, approximately $11.6 million above budget. Notably, the organisation has stated that it does not plan to raise fees in FY27, a rare and telling indicator of confidence in the sector’s underlying stability.

More Registrars, More Registries — But Not Without Scrutiny

The revised budget also anticipates structural expansion:

• Around 400 additional ICANN-accredited registrars

• Approximately 20 additional contracted registries

Some of this growth is attributed to drop-catching business models and dotBrand registry structures. Importantly, none of these projections yet factor in the upcoming ICANN New gTLD Next Round, meaning further expansion is likely in the years ahead. We at Dotup helped over 22 ICANN Accreditation applications and successfully helped them in getting ICANN accreditation including companies like Atom.com etc.

However, early January compliance actions make it clear that accreditation numbers alone do not define success.

No RDAP, No Accreditation: Compliance Is Non-Negotiable

On 13 January 2026, ICANN announced the termination of US-based registrar Brennercom, citing its failure to implement RDAP (Registration Data Access Protocol) — the mandatory successor to legacy Whois.

While the registrar also had outstanding fees and missing website disclosures, the central issue was clear: failure to migrate to RDAP is now a termination-level breach.

Brennercom’s case is instructive. Despite claims of managing “thousands of domains,” records show it never exceeded 133 domains under management and currently held fewer than 40. ICANN will transition these domains to another registrar as part of its standard de-accreditation process.

The message to the market is unambiguous: technical and policy compliance is no longer optional, regardless of registrar size.

Abuse-Driven Growth Is a Dead End

Even more concerning is a separate compliance notice issued against Bulgarian registrar MainReg, where ICANN alleges that nearly half of the registrar’s domains are associated with phishing and scam activity.

Using data from Domain Metrica, ICANN reported that:

• Approximately 48% of MainReg’s domains were linked to phishing in November 2025

• The figure remained at 45% as of 5 January 2026

• Independent third-party analysis allegedly showed even higher abuse ratios

MainReg’s domains under management tripled in just one year — from around 10,000 to 30,000 — almost entirely within legacy gTLDs such as .com, .net, and .org. ICANN has also cited failures to migrate to RDAP and deficiencies in abuse investigation processes.

MainReg has been given until 28 January 2026 to come into compliance or face termination.

The implication is stark: growth driven by abuse is not growth at all — it is regulatory debt.

What This Means for the Industry in 2026

The contrast could not be clearer. ICANN is entering 2026 with:

• Higher-than-expected revenues

• Growing transaction volumes

• No immediate plans to increase fees

At the same time, it is enforcing compliance more decisively than ever, particularly around

RDAP adoption and DNS abuse mitigation.

As Venkatesh Venkatasubramanian, an independent ICANN accreditation and policy consultant, has consistently observed in his advisory work, “the next phase of industry growth will reward operators who treat compliance as infrastructure, not as a checklist.”

This is especially relevant as the industry prepares for the ICANN New gTLD Next Round, where scrutiny on operational readiness, abuse controls, and long-term accountability will be significantly higher than in previous cycles.

A Defining Year Ahead - Domain industry 2026

Early signals from ICANN suggest that 2026 may indeed be a “happy new year” for the domain industry — but only for those willing to operate responsibly. Revenue growth and transaction expansion create opportunity, but enforcement actions underline the cost of complacency.

For registrars, registries, and prospective applicants alike, the takeaway is simple: sustainable growth and strict compliance are now inseparable.The industry is growing up. ICANN is making sure of it.