What Is the Ethereum Name Service (ENS)?
Crypto addresses are long strings of numbers and letters designed to be read by computers. These long addresses have led to confusion and even loss of funds.
The Ethereum Name Service, or ENS, is a distributed technology based on the Ethereum blockchain that provides an elegant solution to long and confusing crypto addresses: one URL, just like a website name or email, that represents a crypto address.
ENS maps the long public address crypto users are familiar with and replaces it with a simple name that is easy to read and easy to remember. Something cumbersome like, “0xDC25EF3F5B8A186998338A2ADA83795FBA2D695E” becomes as simple as “Alice.eth.”
ENS takes the same concept of the Domain Name Service (DNS), which mapped simple website names to their IP addresses, to make crypto addresses easy to read and share.
- ENS is composed of two Ethereum smart contracts: the ENS registry, which records domain names, and the Resolver, which translates domain names to machine-readable addresses and vice-versa.
- Like in the early days of DNS names, users are rushing to secure their ENS domains before they become unavailable.
- ENS supports .com, .org, .io, .app and more.
- Browsers currently supporting ENS include Brave, Opera, Status (mobile), MetaMask Mobile (mobile) and Puma.ENS will not work on a browser such as Chrome or Safari.
ENS vs. DNS
The Domain Name System and the Ethereum Name Service are both protocols that dictate how certain operations, either on Web2 or Web3, are resolved. The DNS converts the IP address of the web server into a human-readable string called a URL.
The Ethereum Name Service converts an Ethereum address into a human-readable string formatted like a URL. In this way, they both function similarly to a phonebook. You can look up a name in a phone book and get the number that will allow you to reach that person.
The DNS is part of a system of internet protocols that allow Web2 to work seamlessly. Web3, a concept describing the new decentralized version of the internet, is still a developing field and has issues that hinder adoption, such as long addresses.
Right now, the primary purpose of ENS is to give people and applications an easy way to read and share crypto addresses and make Web3 more digestible. As Web3 matures, it is likely more protocols will be built around ENS.
How to get an ENS domain
Those who want to create a new ENS domain will need a crypto wallet, such as MetaMask, Torus or MEW, and some ether (ETH). From there, users can search for the domain of their choosing on https://app.ens.domains/.
The cost of a new ENS domain is at least $5, but users should expect to pay fees for the Ethereum transaction.
The ENS is operated by a decentralized autonomous organization (DAO), essentially an organization with no centralized leadership. The DAO governs itself through the ENS token — holders of the token submit proposals and cast votes for future development.
What is the ENS governance token?
The ENS governance token is a token created on the Ethereum blockchain. They are traded by speculators, as are most crypto tokens, but the token also serves a specific role in the ENS community. ENS community members — as members of the DAO — use their tokens to communicate changes they wish to see in the organization.
For instance, later this year, the ENS community will vote on the ENS Constitution — a set of rules and guidelines for how ENS should be governed. Each token can cast one vote. If 67% of votes cast on a particular article of the constitution are “yes” votes, then the article passes.
If a user wants to submit a proposal to the ENS community, they will need the support of 100,000 tokens for it to go to a vote.
Users can vote on many things in the DAO, including:
- Executable proposals for a series of smart contract operations, such as allocating a portion of the liquid token pool to fund a grant for Web3 development.
- Social proposals, carried out off-chain, such as appointing or removing a director, member or supervisor.
- Constitutional amendments, which alter how ENS conducts its mission.
ENS token distribution
To distribute ENS tokens to the community, the developers allocated 25% of the ENS Token supply to users who had already signed up for an ENS domain by Oct. 31, 2021.
- Community treasury: 50%
- Airdrop to .eth holders: 25%
- ENS contributors: 25%
The developers then airdropped these tokens to wallets connected to the ENS domains. Fractions of the ENS token pool were distributed based on how long a given user owned an ENS domain.
In practice, this means that many casual users received tens of thousands of dollars of tokens in the airdrop — while people who have held domains for many years received even more generous allocations.
The ENS Foundation is a legal entity that represents the DAO. This way the foundation can provide legal support to DAO participants.
The foundation has three directors — Nick Johnson, Brantly Millegan and Kevin Gaspar — who are also ENS core team members.
The ENS Foundation is a foundation company limited by guarantee and is incorporated in the Cayman Islands. It is a nonprofit and cannot pay out dividends to its directors or members. The Foundation itself has one supervisor, filled by a Cayman Islands firm, DS Limited.
For more transparency, a list of documents related to the ENS Foundation can be found here.
Ethereum Name Service vs. Unstoppable Domains
ENS is not the only domain name service provider competing for supremacy on Web3. There are several competitors, including Unstoppable Domains. Both Unstoppable and ENS are built on top of Ethereum and both allow users to create and register a human-readable address for crypto addresses.
However, there are some big differences in the philosophy underlying these projects. ENS is an open and public protocol developed by a nonprofit that is heavily focused on decentralization and community decision making.
Unstoppable Domains operates as a for-profit company, and many of its domains have been “brand protected” to prevent individuals from owning certain names, words or phrases. This practice has led to complaints where people have been unable to buy a domain with their name, despite the fact it is not in use, such as JohnSmith.domain.
How to buy ENS
ENS tokens can be purchased at the following exchanges:
Frequently asked questions
What is the ethereum name service (ENS)?
Ethereum name service is a protocol that maps long crypto addresses to simple URLs. Instead of copying long crypto addresses, users can simply send crypto to domains such as “Alice.eth.”
How much does an ENS domain cost?
ENS domains cost as little as $5 before ethereum transactions fees.
Where can you buy ENS tokens?
ENS tokens can be bought at a number of different exchanges such as Binance, FTX and more.
How much are ENS tokens?