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I know the valuations come as a surprise to many. It did me also until I learned hat was really happening.
Since the Chinese Stock market has all but crashed and they can no longer play BitCoins. The money from the new middle class is looking for liquid portable investments. The domain market is not regulated in any way in China.
A few smart guys turned domains into a commodity.
Bringing in investment money that had to be invested in domains.
The language there is of 2 types. Many names are bought on the idea of sounds and may make no sense in English at all.
Not many are investing in "words" yet. And most words do not translate well between Chinese and English in just one or even two words. Google translate is not a good choice for real translations where money is on the line.
The market could go higher, but will last be shortened by it's height.
Now is a good time to make a profit and sell if you are holding.
I still believe the value is a bit overpriced in this way for some, not all of the niches they seem to be interested in.
The value placed on a name has to represent what a end-user of a name might pay plus a profit margin. This is a investment. We are not buying marbles or snowflakes or paintings to be admired.
Most of what they are placing a high value to will have little to no chance of a end user need or want let alone competition for it from more than one player in the next 10 years.
Unless something changes, that does not apply to the 2L & 3L .com's but in that case, they are pricing them high enough that they will not have a likely buyer even if there is a need or want.
If they do not change their buying rabbits and concentrate on names that have a chance of end-user demand in 8 years or less... well ...how do you spell bubble market ?
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