How IPv4 Address Allocation Evolved Over Time
The internet depends on a system of unique identifiers known as IP addresses. Among them, IPv4 has played the most important role in shaping how networks communicate across the globe. Although IPv6 now exists as a successor, IPv4 remains the dominant protocol in use today. Understanding the history of IPv4 address allocation helps explain why IPv4 scarcity exists and why the secondary market for IPv4 addresses has become so valuable.
From informal beginnings to structured global governance, IPv4 allocation has undergone several major transformations.
The Early Days of the Internet and IPv4
IPv4 was introduced in the early 1980s as part of the TCP/IP protocol suite. At the time, the internet was a small academic and research network known as ARPANET. Addressing needs was minimal, and the idea that billions of devices would eventually require connectivity seemed unimaginable.
In these early years, IPv4 address space was distributed very loosely. Large organizations such as universities, research institutions, and technology companies were handed massive address blocks with little oversight. These early recipients are now known as holders of “legacy IPv4 space.”
No formal policies existed to limit how much space an organization could receive or how efficiently it should be used.
The Introduction of Classful Addressing
To organize allocation, IPv4 originally used a class-based system:
- Class A networks provided over 16 million addresses
- Class B networks provided around 65,000 addresses
- Class C networks provided 256 addresses.
This system proved highly inefficient. Organizations often received far more addresses than they needed, leaving large portions of IPv4 space unused but unavailable for redistribution.
This inefficiency significantly accelerated IPv4 exhaustion.
CIDR and the Move Toward Efficiency
In the early 1990s, Classless Inter-Domain Routing, or CIDR, was introduced to replace classful addressing. CIDR allowed IP blocks to be allocated in variable sizes, such as /24, /20, or /16, instead of rigid classes.
This change dramatically improved allocation efficiency and routing scalability. It also allowed registries to conserve remaining IPv4 space more effectively.
CIDR remains the foundation of modern IP allocation.
The Creation of Regional Internet Registries
As the internet grew globally, centralized allocation became impractical. This led to the creation of Regional Internet Registries, or RIRs, responsible for managing IP resources in specific geographic regions.
The five RIRs are:
- ARIN for North America
- RIPE NCC for Europe and the Middle East
- APNIC for Asia Pacific
- LACNIC for Latin America and the Caribbean
- AFRINIC for Africa
These organizations introduced formal allocation policies, registry databases, and documentation requirements.
The Official Exhaustion of IPv4
Between 2011 and 2019, all five RIRs officially ran out of free IPv4 address space. No new IPv4 blocks could be allocated directly to organizations.
This marked a historic turning point. From that moment forward, businesses needing IPv4 addresses had to rely on:
- Transfers from existing holders
- Leasing arrangements
- Legacy address acquisitions
This event triggered the rise of the IPv4 secondary market.
The Emergence of the IPv4 Transfer Market
With IPv4 scarcity becoming permanent, organizations began treating IPv4 addresses as valuable digital assets. Transfer policies were created by RIRs to allow organizations to move IPv4 blocks between owners under regulated conditions.
This gave rise to:
- IPv4 brokers
- Transfer facilitators
- Leasing platforms
- Escrow-based transactions
IPv4 addresses began carrying significant market value.
Why IPv4 Still Dominates Despite IPv6
Although IPv6 was introduced in the late 1990s, adoption has been gradual. Many networks, applications, and services still depend heavily on IPv4.
Reasons include:
- Legacy software compatibility
- Network hardware limitations
- Customer device support
- Operational complexity
As a result, IPv4 remains essential for modern internet operations.
How ipv4hub.net Supports Modern IPv4 Allocation
ipv4hub.net helps businesses acquire IPv4 resources safely through broker-assisted and policy-aligned processes. The platform verifies ownership history, registry accuracy, routing readiness, and reputation status before delivering any IP block. By combining human validation with transparent documentation and ongoing support, ipv4hub.net enables organizations to avoid compliance risks and secure enterprise-ready IPv4 resources in today’s scarce market.
The Long-Term Impact of Early Allocation Decisions
The informal allocation practices of the 1980s still shape the IPv4 market today. Large legacy holdings remain concentrated in a small number of organizations, while new market entrants must pay significant premiums to access address space.
This imbalance continues to influence:
- IPv4 pricing
- Transfer availability
- Leasing demand
- Market speculation
The history of IPv4 address allocation explains why scarcity exists, why IPv4 addresses are treated as valuable assets, and why the secondary market continues to grow.
From informal distribution to regulated transfers, IPv4 allocation has evolved alongside the Internet itself. While IPv6 represents the future, IPv4 remains a foundational component of today’s digital infrastructure.
Understanding this history helps organizations make informed decisions about acquiring and managing IP resources in a rapidly changing internet landscape.