According to CryptoPotato, ENS Labs proposed on May 28 that the Ethereum Name Service (ENS) should expand to layer-2 scaling protocols. This initiative, dubbed 'ENSv2', is not just about migrating core parts of the ENS protocol. The team is leveraging their seven years of experience at the forefront of Web3 to re-envision the architecture from the ground up.
The Ethereum Name Services has millions of .eth names registered and thousands of integrations, including dapps, wallets, top-level domains, and browsers. By expanding to layer-2s, ENS will become more accessible and cheaper to use for a wider range of users. However, ENS Labs has yet to select a specific layer-2 network for the migration.
The primary goals of the expansion, which was considered in July 2023, are to make ENS more decentralized, enable new use cases and integrations, and overcome constraints of the Ethereum mainnet. Moving to layer-2 offers significant benefits, including lower gas fees for registering and renewing .eth names, more control and customization through a hierarchical registry system, and improved multi-chain interoperability by connecting .eth names across networks.
Eskender Abebe, Head of Product and Strategy at ENS Labs, stated that the release of EIP-4844 has made layer 2 networks based on Ethereum vastly more affordable and scalable, which was a significant driving factor for ENS’s proposal. ENS Labs plans to submit an executable proposal to request an annual budget increase of 4 million USDC from the ENS DAO to hire additional developers and cover infrastructure costs related to development and deployment. The proposal was put forward for discussion on the ENS DAO before it goes for a governance vote.
The layer-2 ecosystem recently reached a total value locked all-time high of $47.7 billion, coinciding with the ETH price pump. The Ethereum Name Service native token did not react to the announcement and was trading flat on the day at around $26 at the time of writing. ENS has almost doubled in price over the past fortnight; however, it has surged from around $14 in mid-May to hit a three-month high of just under $28 earlier this week. ENS spiked to $80 when it was airdropped to domain holders in November 2021 but remains down 69% from that peak.