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You can do it with an NS record, ie _acme_challenge.realdomain.com pointing to the DNS server that you can program to serve the challenge response. No need to make a CNAME and involve an additional domain in the middle.

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Yeah, but then you can just as well use http-01 with like same effort.

no, because dns supports wildcard certificates, unlike http.

Ah, good point.

dns-01 is also good for services on a private network.

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