An ACE string is what you get once the IDN you entered in your browser’s address bar has been converted into a form that is understood by the Domain Name System.
ACE-strings begin with four characters, xn--, to indicate that the domain name is an IDN. Other characters, at the end of the string, indicate which characters in the IDN you entered were non-ASCII characters and what their positions were.
The characters between the prefix and the end characters are the characters from the original IDN that did not need to be converted because they already belong to the basic ASCII character set.
For example, the ACE-string of the domain name bücher.eu is xn--bcher-kva.eu.