ENS Surges 10% As Ethereum Name Service Considers Expanding to Layer-2

in a recent community callThe team behind the Ethereum Name Service (ENS) revealed plans to adopt a layer-2 platform in light of rising gas fees on the mainnet. In response to this planned move, ENS price climbed nearly 10%, rising higher as trading volume increased, as evident on the daily chart.

ethereum name service

ENS is a decentralized naming system on Ethereum. It provides an easy-to-use and human-readable naming system that allows users to rename mainnet addresses, smart contracts, and other resources. The system allows users to create and employ memorable domain names instead of complex addresses.

The team behind ENS believes that their solution will make it easier for everyone to interact with leading smart contracting platforms, and in particular to send and receive transactions. In this arrangement, the platform maps a user’s domain, human-readable address with their origin address or smart contract deployed on the Ethereum mainnet.

However, since ENS maps all addresses on the Ethereum mainnet, transaction fees apply, a concern given the volatility of gas fees on Ethereum. In Ethereum, payments must be made for all transactions, including transfers or smart contract deployments. The amount paid depends on the level of demand in the network, and the price is variable. Over the past few weeks, Ethereum gas fees have been on the rise.

Fluctuations in Gas Fees

According to YCharts statistics On June 30, the average gas fee for sending a transaction was $34.62, down from $42.77 recorded on June 5. As of May 12, it was $77.88. The only drop in gas fees on Ethereum was on June 25, when it hit $16.58. At this level, the gas fee is relatively high compared to other networks. For example, the average transaction fee Bitcoin was $2.383 on 30 June, up from $9.018 on 12 May.

Meanwhile, in layer-2 platforms, transaction fees and smart contract deployment costs are relatively low, according to trackers. As one illustrationThe gas fee on the popular Ethereum layer-2, Optimism, is $0.03 as of July 2.

Considering the high gas fee on Ethereum, ENS, through two improvement proposals, ENSIP-10 and EIP-3668, as part of enhancing interoperability, as relief for users sensitive to the high gas fee on Ethereum Will expand to Layer-2 platform in India. During the call, the team said that this will expand the platform and open up the service to more people.

In response, ENS price rose by 10% in the last trading day, trading at $9.42 due to increased trading volume. Still, it remains to be seen whether the price hike will continue once the platform moves to a layer-2 platform. At present, ENS has registered over 2.73 million names owned by over 697,000 entities.

Featured Image from Canva, Chart from TradingView