What Is an IP Address and why are they exhausted?

The Internet Protocol (IP) was introduced as a way to replace the traditional IP networks of the past with new technology called IPV6. With the growth of this new technology, there was a need to secure more space for people and companies on the Internet. This led to the need to upgrade all the existing IP networks to accommodate this new type of technology, which is called ‘IPv4 addresses’.

Limited addresses available 

One of the challenges that was faced was the handling of large numbers of IP addresses, which at the beginning of the planning stages had a limited amount of space available. This limited the number of unique IP addresses that could be used, but it also presented a security issue. Someone had to find a way to make up for this if there was going to be any kind of security measure taken against the use of these large IP blocks. Fortunately, there was an easy solution to the problem of storing large amounts of unique IP addresses and that was to purchase smaller, more easily identified, IP blocks. In short, this means that the Internet Service Provider, or ISP, can purchase smaller, more easily identifiable, IP blocks and make them available to their users in much the same way that they can buy larger, more exclusive, IP blocks.

Temporary solutions

The first of these smaller, more affordable, IP blocks was called ‘Subnet masks’. They were only used for network purposes and were not intended to function as IP addresses. It wasn’t long before other companies had started to use subnet masks for their IP addressing purposes and they began to use them for IP addresses as well. This brought about the first ‘IPv4 address exhaustion’ problem. The larger companies who were already using subnet masks for their IP networks were still able to maintain their connections with each other, but the smaller companies that had started using their own IP addresses for network communications found that they were no longer able to connect to each other. This, of course, was a big problem.

Fortunately, something had to be done and the Internet Service Providers and their members, or ‘regional internet registries’, had another idea. They bought up the IP addresses from the smaller companies and made them available to their subscribers. Once again, this solved the ‘ipv4 addresses exhaustion’ problem but it also created another one. Because the larger companies were no longer making IP packets available to the smaller, regional internet registries, their addresses had been bought up by all the companies which had been connecting via the smaller, regional internet registries – and now those companies could no longer get the IP addresses they needed!

Trade in IPv4 addresses

Now, a couple of years later, an entire trading market has emerged where buyers and sellers of IPv4 addresses find one another and transfer ownership amongst one another. To navigate this complex process, specialized brokers operate as mediating parties to help with matters such as law, ownership and more. One of the leading IPv4 brokers is Prefix Broker. With a proven track record and outstanding knowledge of the market, they are able to support buyers and sellers alike in their search to either buy or sell IPv4 addresses.