Secondly, regardless of where your site is hosted, you're also bound by the registrar's laws/restrictions (especially for ccTLDs), which doesn't make sense for something that is purely a routing mechanism that translates a name to an IP. It'd be fine if domain names were plentiful, but domain hacks[0] also make people use TLDs without regard to considering their territory or any implications.
The whole .org fiasco only proved further that this model with ICANN and for-profit registrars isn't tenable and a horrible fit for an open distributed internet. All these perverse incentives and political fuckery should not exist for something that is an essential part of a worldwide utility.
I'd love if HNers could share any promising alternatives to our current DNS system.