Well, it has worked in the past by domains costing money (i.e. being commercial). When one has to pay real money to get a domain, that is big discouragement for mass-scale fakes, as you have to pay huge amounts of money for a low chance of making your scams work (so cybersquatters target only few). If however domains were free and unlimited, even a tiny chance is just fine, as they'd offset it by registering trillions of free domains ASAP...
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