The User ID Auction System manages the creation and transfer of individual identifiers within namespaces, operating under rules defined by namespace owners.

User IDs are second-level identifiers that exist within specific namespaces (e.g., "alice.redd", where "alice" is the user ID within the "redd" namespace). These identifiers are allocated through a competitive auction process, with rules and economic parameters defined by each namespace owner.

User IDs have the following core properties:

• Format: Determined by namespace rules (typically a-z, 0-9, and potentially special characters)
• Length: Determined by namespace rules (typically 3-32 characters)
• Pricing: Based on length tiers defined by the namespace
• Expiration: Requires periodic renewal based on namespace settings
• Ownership: Can be transferred to new owners

The user ID auction process follows these steps:

1. Creation: An auction is created within a specific namespace
2. Validation: The ID is validated against namespace rules
3. Bidding: Users place bids with required deposits (typically 10-15% of bid)
4. Anti-Sniping: Auctions extend if bids are placed near the end
5. Finalization: Highest bidder wins and receives the user ID
6. Distribution: Proceeds are distributed according to the namespace's revenue model

Revenue from user ID auctions is distributed according to the model defined by the namespace owner, typically:

• Burn Pool: 50-80% (permanently reduces RDD supply)
• Namespace Owner: 5-10% (revenue share for namespace governance)
• Node Operators: 5-25% (rewards infrastructure providers)
• Development Fund: 5-15% (funds ongoing development)

The system implements several mechanisms to discourage squatting:

• Progressive Pricing: Shorter, more desirable names have higher minimum prices
• Renewal Requirements: Regular renewal with fees prevents inactive holding
• Usage Incentives: Active usage may receive renewal discounts
• Grace Periods: Expired IDs enter a grace period before becoming available again

The User ID Auction System is implemented through these components:

• AuctionManager: Handles auction operations for user IDs
• NamespaceManager: Enforces namespace rules for user IDs
• Database schema for persistent storage of user ID data
• P2P protocol extensions for user ID-related messages

For detailed API information, see the User ID API Reference.

See the User ID RPC Commands for command-line interface details.