What is the Ethereum Name Service (ENS)?

TL; DR

Ethereum Name Service (ENS) is a service for naming wallet addresses, hashes, and other machine-readable identifiers. Converts hard-to-read data strings into easy-to-understand addresses. It works similar to the Domain Name System (DNS) used on websites.

ENS initially auctioned off popular six-, five-, four- and three-letter domain names to interested users using the Vickrey auction format. Every name has a name .eth and can be attached to multiple cryptocurrency addresses, hashes, and other information.

You can now easily buy names without an auction and rent them for up to a year. The prices depend on the length of the name you want to rent. Additionally, if you owned an ENS domain on October 31, 2021, you are eligible to airdrop for $ENS management tokens. You have until May 4, 2022 to collect them.

One of the biggest challenges of blockchain is improving its usability and accessibility. If we look at payments with Ethereum (ETH) or Bitcoin (BTC), new or even experienced users may find long wallet addresses impractical and confusing. Strings of hexadecimal numbers are easy to read for a computer but less intuitive for users. Ethereum Name Service (ENS) solves this problem by allowing anyone to create simple website-like addresses that are easier to remember and use.

Ethereum Name Service (ENS) is an Ethereum-based project launched on May 4, 2017 by Alex Van de Sande and Nick Johnson of the Ethereum Foundation. The project allows users to view Ethereum’s long public addresses as simplified text. This makes it easier to share, use and remember addresses and other data. Conversion of machine-readable numbers such as 0xAb5801a7D398351b8bE11C439e05C5B3259aeC9Bin human-readable alternatives, is an important part of improving blockchain adoption.

ENS is not limited to wallet addresses. It can be used to represent transaction IDs, hashes, and metadata commonly found in the cryptocurrency world. You may already be familiar with the Domain Name System (DNS), a naming system that works like an Internet phone book. DNS takes hard-to-remember IP addresses and appends them to an easy-to-use URL like https://academy.binance.com. Indeed, ENS is the DNS of the Ethereum blockchain.

The ENS domain name uses ERC-721 non-exchangeable tokens (NFTs) to represent a unique address. You can trade the domain by transferring or selling the NFT to someone else. Attached to each token are wallet addresses and other information that can be managed by the owner. A top-level domain such as .eth belongs to a smart contract called clerkwhich controls the creation of subdomains. If you want to create a BinanceAcademy.ethyou will need to interact with .eth registrar.

To buy an Ethereum domain name, you can check its availability and rent it annually. However, the popular names went to auction first. The highest bidder who won the domain could then join addresses, create subdomains, and borrow or sell their domain name. For example, if you have BinanceAcademy.ethyou can also create for free learn.BinanceAcademy.eth.

If you’ve ever made a mistake with multiple addresses when sending cryptocurrency, you’ll understand the need for an ENS. Much like saving a friend’s phone number under their name, ENS lets users turn long numbers into easy-to-remember words. This creates a simpler experience with less chance of making mistakes.

The owner of the ENS domain can also create subdomains to which he can then assign other data. It doesn’t always have to be a wallet address. You can use it to redirect to a smart contract, transaction, or metadata.

Getting an ENS name these days is as easy as checking its availability at https://app.ens.domains/ and save it. Let’s take a look at an example of how to get started with this process. First, go to https://app.ens.domains/connect the wallet and enter the domain you are interested in.

You will now see the availability of the selected name. In our case Binance Academy can be registered.

After clicking on the name, you will see instructions on how to register the ENS domain. You can select the registration period and also see the estimated fees. With ether (ETH) in your wallet, you can follow the three steps given and have your address registered.

In the early days of ENS, popular six-, five-, four-, and three-letter names were auctioned off in Vickrey-style auctions. The smart contract covered the whole process for five days. Anyone could participate in the public auction and try to buy the same domain name. Each interested party sent a transaction containing their maximum bid within the first three days of the open auction.

The auction then entered the disclosure phase. Everyone would reveal their bid or lose their locked ETH, and the winning bidder would pay an amount equal to the second highest bid. All disclosed bids would then receive their money.

There are two possible parts to the cost of an ENS domain: auction fees and rental fees. The price of the ENS domain name in the auction depended on the popularity of the name. Recognizable names such as God, Car if ETH, fetched higher prices, and short three-letter words were generally the most expensive. You can see some examples of the prices paid for domain names below.

Once you have an ENS domain, you will need to pay an annual renewal cost payable in ETH. Fees are expressed in dollars but are converted at the exchange rate provided by oracle Chainlink ETH/USD. The annual renewal cost is $5 per year for names of five or more characters, but it costs more the fewer letters you have.

Anyone with an .eth address when the snapshot was created on October 31, 2021 can receive $ENS tokens. You can get them back in just a few simple steps. You have until May 4, 2022 to collect your tokens before they are burned.

1. First go to ENS Airdrop and connect the wallet with the button [Connect] or [Connect wallet].

2. Select the wallet you want to connect to, such as MetaMask, WalletConnect or another provider.

3. Click the button to start [Get started].

4. You will now see an option [Start your claim process] as well as the amount you can receive.

5. Be sure to read the educational information on $ENS and then the Constitution which you will need to sign using your wallet.

6. You can now delegate the voting rights of your tokens to yourself or to another user.

7. Finally, verify the amount you are requesting and your delegate before clicking [Claim] and you will pay the gas fee to unlock your tokens.

In the world of decentralized networks, the ENS is a step forward in creating easily accessible ways to interact with the blockchain. Just as we no longer use IP addresses to browse the web, we can see an increase in ENS names due to their user-friendliness and growing popularity. Interest in the cryptocurrency ecosystem has also increased in the project since its airdrop.

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