by 0x4262f8bb5bd9ad132782d2a7279b532a1dc6bcbf (Wilderness)
Based off an earlier proposal by a fellow community member, https://governance.decentraland.org/proposal/?id=1c4bd950-1296-11ec-ac84-77607720a240
All DCL names are subdomains of the DCL.eth domain. DCL implements a smart contract to mint a corresponding NFT for each subdomain and allow the NFT owner to claim the subdomain (in case of transfers). These NFTs are then used to identify if a user owns the name or not, and if they do, they can set it as their Avatar Name.
With a few changes, DCL can allow subdomains of the dcl names to be minted as NFTs and integrate them into the naming system to allow names like xxx.name (the corresponding ENS subdomain would be xxx.name.dcl.eth)
The Name Registry smart contract is already designed in such a way that it could theoretically work to mint subdomains for any base domain (or subdomain). Implementing this change would just require a slightly modified version of this contract to exist along with the base names. NFTs generated through new smart contracts can then be included in the naming system.
Note: if someone wants to enable subdomains for their name, they would have to transfer ownership of the name to a smart contract.