How to register bucket name for a non-ascii chars domain name (apex)

May be for this reason

Bucket names must not start with the prefix xn--

https://docs.aws.amazon.com/AmazonS3/latest/userguide/bucketnamingrules.html

I found this: https://www.helpnetsecurity.com/2020/03/05/register-malicious-domains/

But that also means that AWS is blocking LEGITIMATE domain owners. Hence it's not a solution.

What's the workaround here?

If this is an issue for you then perhaps use cloudfront and OAC on an S3 bucket where your S3 bucket can be called what ever you want it too.