Ethereum Name Service (ENS): The Decentralized Web3 Naming System Explained

ENS: Everything You Need to Know

ENS stands for Ethereum Name Service, a distributed, open, and extensible naming system based on the Ethereum blockchain. ENS converts human-readable Ethereum addresses like john.eth into the machine-readable alphanumeric codes you know from wallets like Metamask. The reverse conversion – associating metadata and machine-readable addresses with human-readable Ethereum addresses – is also possible.

The goal of ENS is to make the Ethereum-based web easier to access and comprehend for humans - similar to how the Internet’s Domain Name Service makes the internet more accessible. Like DNS, ENS also uses a system of dot-separated hierarchical names called domains with domain owners fully controlling their subdomains.

ENS launched with a highly successful retroactive airdrop in November 2021 that rewarded users who had registered addresses before the project launched its token. However, in February 2022, it faced criticism over apparently homophobic tweets by its director of operations.

ENS’s native token is LPT, which is used to pay for transaction fees and to stake on the network.

How does ENS work?

ENS works by connecting two types of nodes on its network: registrars and resolvers. Registrars are smart contracts that manage the ownership and auction of domain names. Resolvers are smart contracts that store the information associated with domain names, such as addresses, metadata, and content hashes.

Users can interact with ENS through various applications, such as the official ENS app, Metamask, or other wallets and browsers that support ENS. Users can search for available domain names, register them, manage them, and use them to send and receive cryptocurrencies, tokens, or NFTs.

ENS also supports traditional DNS names, such as .com or .org, that users already own. Users can import their DNS names to ENS and use them as Ethereum addresses or decentralized websites.

ENS uses a proof-of-stake consensus mechanism to secure its network and validate transactions. Proof-of-stake means that validators stake their own tokens on the network to participate in the consensus process and earn rewards. Validators are randomly selected by the network based on their stake size and other factors. Validators are responsible for producing blocks, verifying transactions, and maintaining the network state.

ENS also has a governance system that allows LPT holders to participate in the decision making process of the network. LPT holders can vote on proposals that affect the network parameters, such as the inflation rate, the fee structure, the reward distribution, and more. LPT holders can also delegate their voting power to other trusted parties, such as validators or community leaders.

Who is the team behind ENS?

ENS was initially a part of the Ethereum Foundation, but spun off as a separate organization in 2018. Its Lead Developer is Nick Johnson, a software engineer from New Zealand that previously worked at Google and the Ethereum Foundation. The ENS team consists of nine people who are experts in software development, cryptography, design, and community management.

The ENS treasury is governed by a 4-7 multi-signature root with the following members:

Nick Johnson - ENS

Sergey Nazarov - Chainlink

Dan Finlay - Metamask

Taylor Monahan - MyCrypto

Aron Fischer - Colony

Jason Carver - Ethereum Foundation

Martin Swende - Ethereum Foundation

Although ENS has no investors, it is supported by the Ethereum Foundation, Binance_X, Chainlink, Ethereum Classic Labs, Protocol Labs, and other organizations that contribute to its development and adoption.

What are the use cases for ENS?

ENS enables a wide range of use cases for Web3 that require human-friendly naming and addressing of resources. Some of the use cases include:

Web3 usernames: Users can own their usernames, store their avatars and other profile data, and use them across services that support ENS.

Multi-currency wallets: Users can use their ENS names to store all of their addresses and receive any cryptocurrency, token, or NFT without copying and pasting long codes.

Decentralized websites: Users can launch censorship-resistant decentralized websites with ENS by uploading their content to IPFS or other decentralized storage networks and accessing it with their ENS names.

Data tokenization: Users can create data-backed tokens that represent ownership or access rights to data sets with ENS names.

Data DAOs: Users can create decentralized autonomous organizations that manage data sets with ENS names.

And more: Users can also use ENS names for identity management, social media platforms, content creation platforms, e-commerce platforms, health care platforms, entertainment platforms, sports platforms, news platforms, and more.

Conclusion

ENS is a decentralized naming system for Web3 that aims to provide a secure and user-friendly way to address resources using human-readable names. ENS’s native token is LPT, which is used to pay for transaction fees and to stake on the network. ENS enables a wide range of use cases that require human-friendly naming and addressing of resources, such as Web3 usernames, multi-currency wallets, decentralized websites, data tokenization, data DAOs, and more. ENS is an open-source project that was launched in 2017 by Nick Johnson and is supported by a number of organizations and partners.