Kagi has quickly grown into something of a household name within tech circles. From Hacker News and Lobsters to Reddit, the search provider seems to attract near-universal praise. Whenever the topic of search engines comes up, there’s an almost ritual rush to be the first to recommend Kagi, often followed by a chorus of replies echoing the endorsement.
you are right.
You could disable it though in firefox: “about:config” and find “network.IDN_show_punycode” and set to true.
https://www.forbes.com/sites/leemathews/2017/04/17/chrome-and-firefox-adding-protection-against-this-nasty-phishing-trick/