If the winning bidder for a domain name auction does not pay and the auction platform offers the domain name to the next highest bidder(s), the default bidder’s bids should be removed entirely. The platform should treat the auction as if the default bidder never existed. Otherwise, the platform would benefit from a default bidder at the expense of other participants. This is unfair.
Rick Schwartz has been railing against Dynadot’s auction policy for the last couple of days, and I think he has valid points. Nobody can speak for Rick better than Rick himself, so I shared the post he just wrote on LinkedIn and a post from yesterday. If you haven’t experienced this issue with before, you can read his posts to learn what happened and understand why he is upset.
Here’s Rick’s LinkedIn post from yesterday with an email he wrote to Dynadot Founder and CEO Todd Han:
Here’s the original post Rick shared on LinkedIn:
Hopefully, Dynadot changes its auction policy.
Additional thoughts:
I just saw that Richard Kirkendall of Namecheap brought up a valid point regarding default bidders:
Nope, auctions were gamed by a bidder that would open two accounts, bid up auctions to scare away other bidders and would also remain the second bidder so that they could get domains at a much lower price. Our solution is the only solution that works.
— Richard Kirkendall (@NamecheapCEO) November 6, 2025
In lieu of allowing an underbidder to pay for an auction with/without the default bidder’s bids, simply rerunning an auction from scratch could be an option as well. I believe this is what Namecheap and DropCatch do.
Richard Kirkendall of Namecheap brought up a valid point regarding default bidders:
https://x.com/NamecheapCEO/status/1986302887102672976
In lieu of allowing an underbidder to pay for an auction with/without the default bidder’s bids, simply rerunning an auction from scratch could be an option. I believe this is what Namecheap and DropCatch do.
This is totally a crime.
Blankly, stealing money right in front of us with a dagger behind our back. This is an inside Job.
Whoever in charge should be fined and go to jail.
Q…how long has this been going on??
And how much money was stolen?
If I was affected,I will report the company to the AG in California and get the FBI,SEC AND DOJ involved.
Dynadot should ceased Operation now and lose their accreditation.
I just commented on this at DNW. The $6.7 million bid was real, but a fake $10m bid ruined the auction:
https://web.archive.org/web/20191121121210/https://ew.com/article/1999/04/30/dark-side-online-auctions/
Correction: I just commented on it at TheDomains, not DNW.
Dyandot has been doing this auction bs for ages, my guess it’s the offshore or chinese bidders playing games. I had a 4 figure auction cancelled , all it said in the subject was All the best, Dynadot, LIKE WTF is that? I stopped bidding years ago at dynadot because everything got redeemed, now we got people shadow bidding, and defaulting, it’s market manipulation, and highly illegal. Why do domainers always get stuck either holding the bag, or the bill, pure profit from the company!!!
Easy fix, make all bidders have a prepay to bid. If they default they lose the prepay. (Make it something like 10% up to 25% of the bid)
The buyer did pay a % of their bid deposit, which they lost, the unethical thing on dynadots part was making Rick pay full boat, even though they still had the default amount. I have never had the opportunity to make payment in past, just auction cancelled email. Dyandot auctions one big giant waste of time. Life’s to short pushing up their bids.
Fake bidders exist even after verification, and these cases happen in the marketplace. Dynadot gave Rick the courtesy to pay, not an obligation. They did nothing wrong. The real issue is registrars auctioning expired domains—an inherent conflict of interest and a money grab that should never have been allowed in the first place.
VERY EASY FIX – I brought this up 5 years ago, REQUIRE – Prepay to bid, easy fix. They profitted off the fake bids.
I brought this up 5 years ago! I can probably still reproduce the email to my account executive Caleb. It use to happen so much it was unreal. Also after the bid (Years ago, I think the policy has changed now) the original owner could simply renew after they saw how many bids it got. Between the fake bids and that policy you literally lost 50% of your time bidding. Such a waste. I said this should be illegal. I really don’t think Dynadot actually bid it up themselves (But who knows) not having any money attached to being able to bid they should (In my opinion) be held legally liable. They might not have done anything fradulent but they allowed it and profitted from it.
Fake bidders, Bot bidding seconds prior to closing — I despise them.
Main reasons I’ve stopped bidding on expired domains in auctions.
And, no, Rick should NOT have to pay the inflated price bid up by an illegitimate/fake bidder.
It’s an outdated practice. It’s no different than shill bidding IMO.