Punycode is a special encoding for converting Unicode characters in different languages to ASCII. It is used to correctly transcode a domain name containing non-Latin characters into addresses that comply with DNS standards.
Cybercriminals can use Punycode to create phishing pages, since most modern browsers correctly handle national domain names, but do not convert them to the Latin alphabet when displayed in the address bar. Fraudsters can mislead the user by creating websites with URLs similar to those of well-known companies.
For example, according to Punycode rules, the domain coca[.]com typed in Cyrillic letters is transcoded for the DNS server as xn--80a1aib.com; however, the browser address bar does not display the changes.