Key Takeaways

• Ethereum Name Service (ENS) is a decentralized naming system built on Ethereum that converts long, complex wallet addresses into simple, human-readable names like "alice.eth."

• ENS names are ERC-721 non-fungible tokens by default. The ENS NameWrapper contract allows names to be wrapped as ERC-1155 tokens, enabling more granular permission controls and subdomain management.

• ENS is governed by the ENS decentralized autonomous organization (DAO). The $ENS token grants holders voting rights over protocol decisions including fee structures and upgrades.

One consistent challenge for blockchains is making interaction straightforward. Wallet addresses are long strings of characters that are difficult to share safely or remember. ENS addresses this by replacing wallet addresses with short, readable names, similar to how internet domain names replaced numerical IP addresses. This makes sending, receiving, and interacting with Ethereum-based resources more accessible and less prone to error.

What Is Ethereum Name Service?

ENS is a decentralized naming protocol built on Ethereum that lets users register human-readable names ending in ".eth." Each ENS name is an ERC-721 non-fungible token (NFT), giving the owner verifiable ownership that can be transferred or sold like other digital assets.

Beyond wallet addresses, ENS names can link to cryptocurrency addresses on other blockchains, content hashes pointing to websites or files on decentralized storage networks, and personal metadata such as social media handles or email addresses.

ENS also works alongside the traditional Domain Name System (DNS). Using DNS Security Extensions (DNSSEC), owners of regular domains such as ".com" can import their domains into ENS for blockchain-based use.

Since its launch in 2017, ENS has grown into a community-governed protocol managed by the ENS decentralized autonomous organization (DAO), which oversees the ENS root and makes key protocol decisions.

NameWrapper and ERC-1155 names

The ENS NameWrapper contract, deployed in 2023, allows ENS names to be wrapped and represented as ERC-1155 tokens rather than plain ERC-721 tokens. Wrapped names support "fuses": permission settings that control what actions can be taken on a name, such as preventing subdomain creation or preventing the name from being unwrapped. This enables more advanced use cases, including emancipated subdomains that cannot be revoked by the parent name owner.

How Does ENS Work?

Architecture

ENS uses a hierarchical structure similar to DNS. At the top are top-level domains (TLDs) like ".eth," each managed by smart contracts called registrars that define registration rules. The ENS registry is a central smart contract that records domain ownership, resolver assignments, and cache settings. Resolvers are contracts responsible for translating ENS names into addresses or other data.

Forward and reverse resolution

Forward resolution converts an ENS name (such as "alice.eth") into one or more addresses or linked data. Reverse resolution works in the opposite direction: linking an address back to its primary ENS name, which allows wallets and applications to display human-readable names instead of full hex addresses.

Domains and subdomains

Owners of ENS domains can create effectively unlimited subdomains that they fully control. For example, owning "alice.eth" allows creation of "mail.alice.eth" or "shop.alice.eth," each pointing to different resources or managed independently. With the NameWrapper, subdomains can be issued with specific permissions baked in.

What Can You Do With ENS?

ENS simplifies sending and receiving cryptocurrency by replacing complex addresses with readable names, reducing the risk of errors during transactions. A single ENS name can link to multiple blockchain addresses, making cross-chain interactions easier to manage.

ENS names can also store information such as website links, email addresses, and social media handles, making them useful as decentralized identifiers for personal or organizational branding. Subdomain creation and delegation enable communities and applications to build naming systems on top of an ENS domain they control.

Registering and Managing ENS Domains

Registration

Registering an ENS domain requires a compatible crypto wallet and ETH to cover the registration fee. The process involves searching for an available name on the ENS app, and registering it directly. Most names are available on a first-come, first-served basis without auctions.

Pricing and renewal

Registration fees vary by name length. Names with five or more characters typically cost around $5 per year, while shorter names (three to four characters) carry higher fees due to their scarcity. Fees are denominated in ETH but use Chainlink price oracles to maintain approximate dollar-value parity. ENS domains require periodic renewal, and a 90-day grace period after expiration allows owners to renew before a name re-enters the public pool.

Historical note: the auction process

At ENS's launch in 2017, popular short names were distributed through a Vickrey-style sealed-bid auction. This mechanism was discontinued after the initial phase, and new names are no longer distributed via auction.

ENS V2 and Layer 2

ENS V2, announced and developed through 2024, represents a significant architectural shift for the protocol. Rather than operating primarily on the Ethereum mainnet with Layer 2 as a secondary feature, ENS V2 is designed around a Layer 2-native architecture from the ground up.

This redesign aims to substantially reduce the gas fees associated with registering and renewing ENS names, one of the main friction points for users operating on Ethereum mainnet. The new architecture also introduces a more modular resolver system intended to simplify integration for developers building on ENS.

Existing .eth names registered on the mainnet can be migrated to the V2 system. ENS has documented a migration path for existing name holders; the process and timeline are governed by the ENS DAO. The original mainnet contracts continue to function during the transition period.

ENS Governance and Security

The ENS root domain and protocol parameters are governed by the ENS DAO, a community governance structure made up of $ENS token holders. The DAO votes on fee structures, protocol upgrades, and other governance matters through on-chain proposals.

The $ENS token is the governance token of the ENS protocol. It was distributed to early adopters and ENS name holders through an airdrop in November 2021, and grants holders voting rights on governance proposals proportional to their holdings. The token does not represent ownership of the ENS protocol itself; its primary function is participation in governance decisions.

Once owned, ENS names cannot be revoked by the protocol or the DAO except through non-renewal. This means if an owner does not renew before the expiration of the grace period, the name returns to the public pool. Name security depends on the owner retaining access to their private keys.

Expanding on ENS

How do I register an ENS name?

Visit the ENS app (app.ens.domains), connect a compatible Ethereum wallet, and search for an available name. If the name is available, you can register it by paying the annual fee in ETH. Registration is on a first-come, first-served basis. You will need to renew the name periodically to maintain ownership.

What is the ENS token ($ENS) used for?

The $ENS token is used for governance participation in the ENS DAO. Token holders can vote on proposals related to fee structures, protocol upgrades, and other decisions affecting the ENS protocol. Holding $ENS does not give ownership of any ENS domain names or rights to ENS protocol revenue.

Can ENS names be used on blockchains other than Ethereum?

ENS was originally designed for Ethereum and .eth names are rooted on Ethereum. However, an ENS name can store addresses for multiple blockchains, allowing a single name to resolve to different addresses depending on the context. ENS V2's Layer 2 architecture also extends ENS functionality to supported L2 networks, and some wallets issue ENS subdomains on L2 to reduce costs for their users.

Closing Thoughts

ENS offers a naming layer for blockchain addresses that mirrors how domain names work on the traditional internet, replacing hard-to-use strings with readable identifiers that can link to a wide range of on-chain and off-chain data. With ENS V2 moving the protocol to a Layer 2-native architecture, registration and renewal costs are expected to become more accessible for a broader range of users. Whether decentralized naming services become a standard part of how people interact with blockchains over time remains to be seen, but ENS has established itself as the primary naming infrastructure on Ethereum.

Further Reading

• What Is Ethereum and How Does It Work?

• What Are Smart Contracts and How Do They Work?

• How Do Gas Fees Work on Ethereum?

• What Is ERC-1155 and How Does It Work?

• What Is a Non-Fungible Token (NFT)?

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