What happens if your definition of a top-level domain disagrees with ICAN's? I mean, what happens if you sell .xyzzy to Bob, and then ICAN, without caring about your project, sells .xyzzy to Alice? How should the conflict be resolved?

What I see happening as a complete outsider is that "the community" (eg browsers, libraries) puts them under a tld against their wishes, to resolve this exact issue.