- The ENS seeks to solve the problem that crypto addresses have long strings of numbers and letters and that by making a mistake in entering a digit, a person can make a mistake when entering said address and, if so, the funds can be lose.
- ENS consists of a distributed technology based on the Ethereum blockchain that basically manages to represent a crypto address as a URL, and works in a very similar way to the DNS system.
- The ENS was inspired by the technological challenge it faced in the development and adoption of the Internet.
The world of cryptocurrencies is not necessarily user friendly. Generally, everyone faces a rather particular learning curve since, to begin with, it is necessary to process a large amount of information in a short time and, therefore, this can take a significant amount of time.
Obviously, the more difficult it is to use something, the more resistance you will experience in the adoption process and if one thing the cryptocurrency sector needs is mass adoption.
Solutions must be created that simplify some processes or interactions in the sector. This is precisely what the Ethereum Name Services, or ENS for its acronym in English, consists of.
The problem of crypto addresses
The ENS aims to solve one problem in particular: long strings of numbers and letters designed to be read by computers, i.e. crypto addresses. The point is that a person may make a mistake when entering such an address and if so, the funds may be lost.
One of the greatest fears of people who start in this world is precisely losing their money in this way and rightly so, since there is an innumerable list of cases of this style.
The reality is that fear paralyzes, and consequently, people stop preferring to carry out this type of transaction.
In fact, the ENS was inspired by the technological challenge it faced in the development and adoption of the Internet. Previously to access a website it was necessary to write your IP address, that is, a series of numbers and, as with cryptocurrencies, a string of numbers and dots makes navigation difficult.
This is how, in 1983, a scientist named Paul Mockapetris developed the Domain Name System (DNS) from research carried out by scientist Elizabeth Feinler.
Ethereum Name Service fixes this problem
ENS consists of a distributed technology based on the Ethereum blockchain that basically manages to represent a cryptographic address as a URL, ands say, as if it were the name of a website or email, and It works in a very similar way to the DNS system.
It is made up of two Smart Contracts: The first consists of the ENS registry and is in charge of registering the domain names, and the second is the Resolver in charge of translating the domain names into machine-readable addresses and vice versa.
So instead of being an address like “1b9acfc5618e6”, the ENS maps to a name like “andrea.eth”. So when making a transaction, they can directly enter the address “andrea.eth”, instead of “1b9acfc5618e6”. For it, each user can buy and manage their own domains.
Who is behind the ENS?
Currently True Names LTD manages the development of ENS. And what is True Names LTD? Well, a non-profit organization that is run by Nick Johnson.
It is relevant to note that the initial development of the ENS was led by Alex Van de Sande and Nick Johnson in 2017. Both belonged to the Ethereum Foundation but, in 2018, they separated into a different organization.
In this way, Much of the team behind ENS is made up of developers who used to work on the Ethereum Foundation and Solidity.
However, ENS is an open source and decentralized project. In other words, the ENS Foundation does not have a traditional business hierarchy for its management, but rather is constituted as a legal entity that represents a Decentralized Autonomous Organization (DAO).
The Foundation cannot pay dividends to its directors or members. And since it is a DAO, a few ENS governance tokens were created and launched.
The ENS token is a token created on the Ethereum blockchain. which is classified as a governance token so the holders of said token use it to vote on the future of the project.
How does the ENS process work?
It is essential to understand that the ENS does not indicate the ownership of any trademark, copyright or any other type of intellectual property. In fact, ENS names are not being sold by any party or entity.
Yes, the process of claiming an ENS domain involves blocking and/or burning funds, however, it is not a buying-selling process, but rather a process to discourage spam and ensure that the claimed names are used.
Bearing this in mind, it should be known that the process of claiming a name takes five days. In fact, it requires multiple transactions that are time sensitive and generally irreversible.
The first two steps are: Have an Ethereum wallet like MetaMask where you must have some ETH and check https://app.ens.domains/ to search for available domain names. And, after having found your domain, the process will begin.
The process begins by opening a public auction for the name you wish to claim, this will send an alert that can be seen by anyone looking at the blockchain for that specific name.
In this way, anyone can bid on the auction for their desired domain within the next five days by submitting a transaction with the maximum amount they are willing to pay.
However, offers are accepted up to 72 hours after the auction has started. After those 72 hours, there will be a 48-hour period in which bidders must disclose their bids. Failure to do so will result in the funds being forfeited.
It will be the bidder who was willing to pay a higher amount for the name who will be the registrant. But, an interesting detail is that, you will only pay an amount equal to the second highest offer.
The minimum funds required to participate in the auction is 0.01 ETH. In case of not being the highest bidder and not winning the auction, the funds will be returned in full less a commission of 0.5% that will be burned.
ENS vs.
Although the ENS may sound very similar to the DNS system, the architecture is significantly different. However, the ENS is not intended to replace DNS.
The ENS is intended to provide a distributed trusted naming solution for Web3 resources. In other words, making Web3 more accessible and digestible for all types of consumers.
While DNS, on the other hand, provides a solution for Web2, which, as previously explained in the introductory guides to Bitcoin Mexico, is essentially different from Web3.
Therefore, the ENS does not seek to compete with the DNS, unlike other projects such as Namecoin and Blockstack that seek to replace the DNS.
Why use ENS?
An interesting difference from DNS records is that ENS was developed in a decentralized manner and is therefore less prone to security issues.
Also, by using an ENS, users replace their long and unreadable Ethereum address with one that is much easier to remember and use. In this way, the operations in the market become simpler and additionally, it allows people to install themselves in the Ethereum network and become a clear point of contact in a sea of incomprehensible addresses for us and with this, the probability of making mistakes when entering or sharing the address of our wallet.
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