[nl]

Maybe the server generates the private key/public key pair, then derives the domain name from the public key (eg, long-random-string-that-comes-from-public-key.dyndns.com)? This derivation process could be the "encryption algorithm" the article refers to?

The client is given the new servername via the P2P network, then derives the public key from the hostname, encrypts using it and communicates with the server which can decode using the private key.

I'm not sure what the max length of a hostname is, which might be a problem.

Another possibility is to put the public key in a TEXT DNS for the server hostname. That could be what they meant maybe?