> there's no need for special support in the DNS system or other infrastructure
Many TLDs disallow registrations containing punycode. Take a look at Wikipedia's (incomplete?) list of those that do: https://en.wikipedia.org/wiki/List_of_cctlds
Many TLDs disallow registrations containing punycode. Take a look at Wikipedia's (incomplete?) list of those that do: https://en.wikipedia.org/wiki/List_of_cctlds
The one technical challenge I suppose could be a concern would be optionally implementing some sort of test to detect domain registration attempts that use similar-looking characters to those in existing legitimate domains (e.g., registrations from scammers attempting phishing attacks with domains that look similar to other domains but use different extended characters).
Still, it feels like the lack of support from these TLDs is more a matter of policy than a technical challenge.
This is called the IDN homograph attack (https://en.wikipedia.org/wiki/IDN_homograph_attack).