Ethereum Name Service ens

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Collective Shift Analysis

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Ethereum Name Service Summary

The Ethereum Name Service (ENS) is a decentralised and open naming system on Ethereum. ENS provides a platform for human-readable names that are tied to Ethereum addresses and allows metadata to be associated with an Ethereum address by using reverse resolution.

For example, instead of having a long string of letters and numbers as your address (0xfaf87d280aa60b2175fb6a537ebce75c943e22d) a user can have a simple human-readable address (collectiveshift.eth) to make sending and receiving cryptocurrency easier. It’s essentially a name for your cryptocurrency addresses. 

ENS has similar goals to the Internet’s Domain Name Service (DNS) but has a significantly different architecture due to the capabilities and constraints provided by the Ethereum blockchain. Like DNS, ENS operates on a system of dot-separated hierarchical names called domains, with the owner of a domain having full control over subdomains.

UI ens website

ENS operates on a system of dot-separated hierarchical names called domains which are similar to traditional website domains. Domains are owned by smart contracts called registrars, which are ERC-721 tokens and like any NFT can be traded, bought and sold. Registrars also specify rules for governing the creation and allocation of subdomains. Domain owners at any level may create a subdomain of their choosing. For example, if Collective Shift held the domain ‘collective.eth’, we could make the subdomain ‘pay.collective.eth’ and assign it to an address of your choosing.

ENS generates protocol revenue by charging customers for registering domain names. Currently, registration costs are as follows:

  • 5+ character .eth names: $5 in ETH per year.
  • 4 character .eth names: $160 in ETH per year.
  • 3 character .eth names $640 in ETH per year.

ENS Token Utility

Ethereum Name Service’s native token is ENS, an ERC-20 token with a 100M maximum supply. ENS is a governance token that will be used to govern the newly formed ENS DAO.

Currently, the ENS DAO primarily governs protocol parameters (e.g. pricing, price oracle) and the community treasury.

ENS was distributed on Nov. 8, 2021. Of the total supply, 25% went to domain holders, 25% to ENS contributors and 50% to the treasury.

Tokens for core contributors and launch advisors are vested over a four-year lock-up period. Regarding the treasury, 10% was available to the DAO at launch and the remaining unlocks over four years. The treasury lock-up excludes treasury funds raised from operational revenue. No tokens are allocated for investors as there are none.