But how would an average user know that xn--googe-hof.com isn’t the right one?

Note that everything outside of ASCII gets encoded in Punycode, so this also includes most languages written in the Latin script.

I’m unsure how that’d be useful to any normal user. Let’s say the UI shows something like this:

A.com
Α.com (xn--mxa.com)
А.com (xn--80a.com)

What’s the user supposed to do with that information, how would showing the Punycode here help any normal user determine which one of these domains is the right one that they want to visit?

Helping users identify the right domain name and avoid being deceived is surely a very important thing to do, I just find it hard to see how having users read Punycode would ever be a practically useful way to achieve that.

The problem with that line of reasoning is that it ruins what’s arguably the most important feature of DNS: providing human-readable names.

Using lookalike characters to deceive people has been a problem since long before anyone first got the idea to register paypa1.com but no-one ever seriously suggested abandoning human-readable names in order to avoid that problem.

Today is just Tuesday, you have been misinformed.

Yes, it’s not very user friendly of Lemmy to display the Punycode encoded URL instead of the human readable form. While only a fraction of all people on the internet are able to read Japanese, there aren’t any at all who are able to read Punycode fluently.