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    3. ENS Completes a Quiet "Self-Revolution"

    ENS Completes a Quiet "Self-Revolution"

    By: rootdata|2026/08/12 11:55:00
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    Author: Eric, Foresight News

    On August 11, Beijing time, the ENS DAO officially voted to approve and execute the proposal "Next Era of ENS DAO." This important domain protocol on Ethereum, after nearly a decade of operation, has finally filled a long-missing piece of the puzzle: a legal entity that can represent it in the real world.

    The story began in June this year. On June 19, Katherine Wu, a director of the ENS Foundation, published a proposal on the governance forum, with the core idea of entrusting the daily operations, grant management, and long-term funding strategy of the DAO to a functioning ENS Foundation.

    This idea immediately sparked heated discussions in the community. Lefteris Karapetsas, founder of Rotki, openly stated on X that this proposal essentially equates to the self-dissolution of the DAO, handing over nearly $500 million in treasury to the foundation. He even criticized founder Nick Johnson for delegating half of the voting power to himself. In a fit of anger, a researcher from L2BEAT even built an alternative domain solution without an owner and resistant to rug pulls. During the peak of the debate, proposal author Katherine Wu clarified in a lengthy post but closed the comments section, which only led to more skepticism.

    The community's concerns were not unfounded. When the batch of DAOs was established in 2021, they believed that token-weighted governance could solve everything. However, after a few years, issues such as voting fatigue, lack of accountability for grant recipients, and high coordination costs have also plagued ENS. Nick Johnson's response was candid; he stated that the DAO was primarily concerned with how to spend the treasury, and the low delegation rate highlighted how difficult it is to maintain DAO security through token voting. In other words, this is not a question of whether to decentralize, but rather what the DAO format is truly suitable for.

    The final approved version made significant concessions compared to the initial draft from June, which is also a noteworthy aspect of this proposal.

    First, the DAO holds approximately 54.6% of the total supply, or about 54.6 million ENS tokens, which will remain untouched and continue to be controlled by token holders under the on-chain mechanism. The only exception is a one-time transfer of 1 million ENS tokens specifically for future employee salaries at the foundation, which cannot participate in voting, delegation, or lending during the grant period.

    Second, the operational wallet containing about $16 million in Ethereum and stablecoins will also remain unchanged, continuing to be managed by the DAO. The initial idea of entrusting the operational wallet to the foundation was scrapped.

    Third, although the approximately $65 million donation fund will be managed by the foundation's board, each transaction must undergo a 9-day time lock, during which the security council can directly veto any unauthorized transactions. Before the foundation announces its first annual budget, it can only withdraw up to $500,000 from the donation fund for setup expenses, and subsequent annual expenditures will be capped by the public budget, subject to annual audits and quarterly grant reports.

    It can be said that the final plan has divided the "money bag" key into several parts: the foundation holds one key, the time lock holds another, the security council holds another, and DAO token holders always retain the master key, including the right to appoint and dismiss directors. The dismissal process is clearly outlined, requiring evidence to accompany petitions, with a response window from the board, and a 30-day interval between petition submission and voting, allowing the impeached director to publicly present a written defense.

    So what exactly will the foundation do? The answer is to handle tasks that the DAO cannot do and that ENS Labs should not handle.

    ENS operates on-chain, but the rules of the domain world are set in the meeting rooms of traditional institutions like ICANN, IETF, and W3C. The DAO lacks legal identity, cannot sign agreements, cannot hire full-time employees, cannot push for the formal recognition of the ".ens" top-level domain at ICANN, and cannot initiate trademark protection against phishing sites impersonating ENS. Over the past few years, these tasks have either gone unaddressed or have been handled by ENS Labs, which is essentially an engineering company based in Singapore and has never been the institutional representative of the protocol.

    The new foundation's board will consist of five seats. Executive Director Alexander Urbelis, who is also the General Counsel and Chief Information Security Officer of ENS Labs, has previously served as CISO for the NFL. The founder's seat belongs to Nick Johnson. The other three independent directors are Kartik Talwar, partner at A.Capital and co-founder of ETHGlobal; Brett Sun, co-founder of Prelude; and Anthony Leutenegger, CEO of Aragon. Independent directors will receive an annual salary of 40,000 USDC, which will be donated to a charity of their choice if declined. The conflict of interest clauses are detailed, requiring majority approval from independent directors for decisions involving ENS Labs' grants, with the founder's seat automatically recusing itself from such votes.

    For ENS Labs, this is also a form of liberation. It can refocus its energy on products and engineering, concentrating on advancing ENSv2. In February of this year, Labs made a decisive decision to abandon the self-built L2 network Namechain and directly deploy ENSv2 on the Ethereum mainnet, citing Ethereum's own scaling that reduced registration gas costs by about 99%.

    With the governance structure clarified, the roles of the protocol, foundation, and development company can finally take shape.

    The impact of this proposal clearly extends beyond ENS. In recent years, the Web3 industry has witnessed numerous failures in DAO governance, either indecisive or dominated by large holders and professional governance players. ENS's answer is to acknowledge the limitations of token voting, returning to what it does best: safeguarding the neutrality of the protocol, while entrusting operations to a professional entity with budget constraints, audits, and dismissal mechanisms. The number of votes may decrease, but the weight of each vote will increase.

    Of course, skepticism will not disappear. Handing over administrative control of $65 million to a five-person board essentially trades institutional design for execution efficiency, with time locks and security councils serving as technical fuses. The real test lies in the first budget, the first batch of grants, and the first appearance at an ICANN meeting after the inaugural board takes office. ENS aims to prove that critical internet infrastructure can be both trusted and neutral, while having someone to represent it at the negotiation table in the real world. The outcome of this experiment will serve as a reference point for the entire DAO industry in the coming years.

    -- Price

    --

    This content is provided for general informational purposes only and doesn't constitute financial, investment, legal, or tax advice. Any events, rewards, online promotions, or related information mentioned herein should not be considered a recommendation, solicitation, or invitation to purchase, sell, trade, or otherwise deal in any crypto assets. Crypto assets are highly volatile and may result in loss. The availability of WEEX services, products, and related events may vary by region. You are responsible for ensuring that your participation is in accordance with applicable local laws and regulations.

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