[dnzkw]

That's good in theory. The reality is that punycode never took off anywhere in the world.

Unless you're proposing we let it live in case someone somewhere ever uses it. Then, sure.

[tialaramex]

How does the popularity of https://en.wikipedia.org/wiki/.%D1%80%D1%84 square with your theory that it "never took off anywhere in the world" ?

Of course that registry actually has a sane punycode policy, so such impersonations are impossible there, whereas they're happening all the time in .com. Maybe time to re-evaluate your idea of "reality" versus "theory".