DeFi is mostly considered the area for technically skilled individuals and it can scare non-technical users. ENS is a protocol that brings more simplicity to DeFi that you are going to read about in this article.
What is Ethereum Name Service (ENS)?
Ethereum Name Service or ENS is a protocol that allows wallet holders to assign a title or proper noun to their wallet address. Usually, wallet addresses are based on a lengthy serial number made up of alpha numeric values.
However, with ENS, users can shorten their wallet addresses by converting it into a more discernable string. The same service is also applicable to hashes and machine-readable IDs. It works in the same way as DNS or Domain Name System that is used to specify a particular name for a site.
ENS allows users to purchase three to six letter domain names using the Vickery method. The title ends in .eth and applicable for various crypto wallet addresses, hashes, and other types of blockchain domains.
The cost of a rented title much like domain name depends on the duration of the rental. People who owned an ENS domain received $ENS token via airdrop which ended in 2022. The main use case of ENS is making the address more readable for human users.
How does ENS Work?
ENS was first introduced by Nick Johnson and Alex Van de Sande in 2017. They aimed to convert the complex hexadecimal public addresses into simpler and more readable string format. ENS is also applicable to metadata, hashes, and transaction IDs.
There is also a governance token issued by ENS to pave the way for the blockchain to transition into a decentralized autonomous organization or DAO. Typically, ENS uses ERC-721 NFTs to assign a text-based name to a given address.
The owner or renter of the NFT may be able to sell it to another user. Meanwhile, the top-level domain namely .eth is owned by smart contracts that are called registrars. These smart contracts create subdomains.
Institutions and individuals can check the available domain names and rent it on yearly basis. Highest bidder gets the required domain name and has the option to sell or loan it by creating sub-domains.
How to Get an ENS Domain?
Here are some simple steps to apply for an ENS domain name:
- Visit http://app.ens.domains/ and check the availability of the required domain name to register it after connecting existing wallet account.
- If the name is not sold out yet, the user will be able to click on it and get instructions to register their ENS domain.
- The user has the option to pick the registration period and view fee estimates.
- Upon confirmation the user is asked to make two ETH transactions to complete the registration process.
- Once both transactions are confirmed, the users can now use their assigned ENS name.
- Before updating to the current structure, users were able to bid for a given ENS name. Bids were collected and selected randomly through smart contract.
Cost of Purchasing ENS Domain
The total cost of an ENS domain is split into two separate parts. The first one is auction cost and second is rental cost. The price of a domain name depends on its popularity. Three-letter domain-names are usually most expensive.
The first transaction is to pay the auction or domain cost. The second transaction mentioned in the purchasing process is rental cost. Just like a regular domain name, users have to pay rental amount in ETH to renew their ENS domains.
How to Get ENS Airdrop Tokens?
When ENS introduced .eth addresses, anyone who already owned .eth domain was automatically eligible to claim the airdrop. Here are a few simple steps for ENS domain owners to claim their $ENS tokens:
- Visit the ENS airdrop URL and connect the wallet address.
- There are many wallet options to connect such as MetaMask, Coinbase, Torus, and WalletConnect, etc.
- Once the wallet is connected the users will be directed to proceed by entering the amount that they are qualified to receive.
- Before claiming the token, the users must read the educational data about $ENS and constitution that they have to sign with their wallets.
- Since $ENS is a governance token, users can also delegate their voting rights to their peers.
- Confirm the token collection and pay the gas fee to unlock the new tokens.
ENS reduces the complexity of decentralized networks and makes them easier for non-technical users. It is much like a complicated URL that the users can convert into more apprehensible domain name to ensure ease of access.