Paying miners for including your NameTx can be done in a straightforward manner. Nothing fancy is required.

Introduce a couple of new fields into the NameTx message, call them:


When the buyer broadcasts his NameTx to claim a new name, he leaves the miner_payment_address field blank and sets the fee field to be however much he is willing to pay for inclusion into a block.

Miners that receive the transaction and begin working on it create a new BitCoin address for themselves and set miner_payment_address to it. When they solve a block, it is broadcast and the name enters a pending state. It isn't available for purchase anymore but it doesn't resolve to IP addresses either. To complete the purchase the buyer sends the fee to the miners address. Once they do so, each DNS node observes that the BitCoin address in the miner_payment_address field has received 'fee' coins and start serving the name. If insufficient payment is sent within a few days the name becomes available once again. The miner loses but the buyer doesn't get anything either. The pending state ensures that people cannot watch transactions and immediately outbid somebody then try to sell the name back to them at inflated prices.

I'm explaining this as an example of how to link chains together financially whilst keeping them separate. I don't actually think a BitDNS style system makes any sense. The interest seems to come primarily from wanting to prevent your name being seized by governments. If your website is illegal in a particular jurisdiction (like the USA) then there's a simple solution - use a domain name under a different countries TLD, pick a country where your operation is legal. If your operation is illegal everywhere then you have to use Tor which already provides a secure P2P DNS system, but also anonymity for both service provider and clients.

A BitDNS system only makes sense if you're very concerned about your domain name being seized, but not concerned at all about seizure of your servers, your clients identities or yourself. Maybe I missed something, but I can't think of any operations which actually operate under such a threat model.