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The existing .com sex domains have a value of tens (if not hundreds) of billions of dollars. Would the government just seize those assets witout compensation? Or would we like to pay them the billions for taking their property? There is no good way to do this.

That argument makes no sense. .com sex domain have that value only if someone else can use them for the identical purpose the are used for now.
What makes their transfer to the .XXX domain any less valuable? Are you suggesting that the accidental access to these sites has intrinsic value?
I don't understand why any "compensation" is necessary. It's exactly like giving the tenants of a porn shop an identical facility elsewhere. Being a net presence, the there is no "physical" location!

"What makes their transfer to the .XXX domain any less valuable? Are you suggesting that the accidental access to these sites has intrinsic value?
I don't understand why any "compensation" is necessary. It's exactly like giving the tenants of a porn shop an identical facility elsewhere. Being a net presence, the there is no "physical" location!"

Not being physical doesn't make the property less valuable - consider patents, video rights, copyrights.. all can have great value.

Also, it is unconstitutional to seize assets without compensation....

They aren't really tenets, they are more like owners. You can't take someone's downtown property and say "we will give you the same acreage out in the country."