The Ethereum Name Service went live on Ethereum's main network on May 4, 201723. Its registrar let anyone claim a name ending in .eth and point it at an address. Nick Johnson had written the core spec in April 20161. He is its lead developer, Fortune reported in 20237.
What problem did it solve? Ether addresses are 42 characters long, Cointelegraph noted in 20173. Fortune's Jeff John Roberts uses the name jeffroberts.eth in place of his7. Johnson's spec put the goal in one sentence: “This permits users and developers to refer to human-readable and easy to remember names, and permits those names to be updated as necessary when the underlying resource (contract, content-addressed data, etc) changes.”1
Names drew money fast, and speculators faster. This story follows the paper trail from the first auction to the DAO's quarterly books.
Auctions, deeds and squatters
The first registrar sold names of seven characters or more in sealed-bid auctions2. Each winner's ether sat in a deed contract, and the owner could reclaim it after one year. The spec admitted a problem before launch. "In order to maximize utility and adoption of a new namespace, the registrar should mitigate speculation and “name squatting”, however the best approach for mitigation is unclear," wrote Johnson and his co-authors.
Speculators came anyway. By October 28, 2017, more than 618,000 auctions had started, Cointelegraph reported3. Bidders had deposited 3,298,707 ETH. One name, exchange.eth, was claimed for 6,660 ETH, which Cointelegraph put at $609,000. Its writer, Pascal Thellmann, added that many buyers meant “to resell or squat the name in order to seek profit from its resale at a much higher price”.
Johnson later named the flaw himself. “It’s perversely cheaper to squat on a name than to own it: squatters only have the cost of locking their ether up until they sell the name, while end-users have to consider the ether permanently gone,” he wrote on the ENS forum in February 20214.
Both sides, in their own words
Can a name system keep squatters out and still pay its way?
“It’s perversely cheaper to squat on a name than to own it: squatters only have the cost of locking their ether up until they sell the name, while end-users have to consider the ether permanently gone”
“Just as we saw in the 1990s, squatters are actively gobbling up .eth domain names that contain famous trademarks”
From deeds to a yearly fee
ENS moved to a yearly fee, much as web domains work. Johnson called that scheme "very similar to that used for DNS" in the same 2021 post4. A name that its owner stops paying for returns to circulation after a grace period. In 2025 a name of five or more characters cost $5 a year, four characters $160 and three characters $64010.
Each .eth name is also an NFT, a token for one specific item. ENS documentation says the registrar came first: “In the early days of ENS, the ERC721 standard did not exist. The original ETH Registrar formed the pre-cursor to the ERC721 standard.”5
The names and the money
Names took off in 2022. ENS said on January 1, 2023, that more than 2.2 million names were registered in 20226. That was 80 percent of every name created to that point. Dune Analytics data cited by Cointelegraph showed about 2.82 million names and 630,340 owners on January 2, 2023. In February 2023, ENS told Fortune it had registered more than 2.5 million names for over half a million buyers7. The DAO that runs ENS then held over $60 million in ether and $2 million in stablecoins. Fortune reported that the DAO earned that money selling and renewing names.
Fees show the same arc in dollars. DefiLlama adds up what buyers paid to register, renew or win an expired name11. That came to $26.17 million in 2021 and $55.40 million in 2022. The sum fell to $13.79 million in 2023, $6.90 million in 2024 and $5.80 million in 2025. May 2022 was the busiest month, at $9.53 million.
.eth name fees peaked at $9.53 million in May 2022; September 2026 brought $0.24 million
Fees paid each month to register, renew or win expired .eth names, in millions of US dollars
- May 2022, the busiest month for .eth fees: $9.53M
- Every other month from January 2021
- Height: Fees paid, $ millions
Source: DefiLlama [11].
Read the chart as a table
| Item | Value |
|---|---|
| Jan. 2021 | $0.51M |
| Feb. 2021 | $0.65M |
| March 2021 | $0.78M |
| April 2021 | $0.97M |
| May 2021 | $0.74M |
| June 2021 | $1.01M |
| July 2021 | $0.81M |
| Aug. 2021 | $2.60M |
| Sept. 2021 | $2.49M |
| Oct. 2021 | $1.88M |
| Nov. 2021 | $7.95M |
| Dec. 2021 | $5.78M |
| Jan. 2022 | $4.01M |
| Feb. 2022 | $3.97M |
| March 2022 | $3.34M |
| April 2022 | $7.79M |
| May 2022 | $9.53M |
| June 2022 | $3.28M |
| July 2022 | $6.97M |
| Aug. 2022 | $4.70M |
| Sept. 2022 | $5.52M |
| Oct. 2022 | $2.97M |
| Nov. 2022 | $1.69M |
| Dec. 2022 | $1.63M |
| Jan. 2023 | $1.89M |
| Feb. 2023 | $2.28M |
| March 2023 | $1.74M |
| April 2023 | $1.73M |
| May 2023 | $0.66M |
| June 2023 | $0.75M |
| July 2023 | $0.75M |
| Aug. 2023 | $1.47M |
| Sept. 2023 | $0.56M |
| Oct. 2023 | $0.68M |
| Nov. 2023 | $0.55M |
| Dec. 2023 | $0.74M |
| Jan. 2024 | $0.80M |
| Feb. 2024 | $0.92M |
| March 2024 | $0.67M |
| April 2024 | $0.68M |
| May 2024 | $0.57M |
| June 2024 | $0.49M |
| July 2024 | $0.41M |
| Aug. 2024 | $0.63M |
| Sept. 2024 | $0.40M |
| Oct. 2024 | $0.33M |
| Nov. 2024 | $0.38M |
| Dec. 2024 | $0.64M |
| Jan. 2025 | $0.58M |
| Feb. 2025 | $0.44M |
| March 2025 | $0.33M |
| April 2025 | $0.30M |
| May 2025 | $0.34M |
| June 2025 | $0.44M |
| July 2025 | $0.59M |
| Aug. 2025 | $1.64M |
| Sept. 2025 | $0.32M |
| Oct. 2025 | $0.30M |
| Nov. 2025 | $0.22M |
| Dec. 2025 | $0.31M |
| Jan. 2026 | $0.54M |
| Feb. 2026 | $0.49M |
| March 2026 | $0.36M |
| April 2026 | $0.34M |
| May 2026 | $0.34M |
| June 2026 | $0.23M |
| July 2026 | $0.22M |
| Aug. 2026 | $0.35M |
| Sept. 2026 | $0.24M |
The ENS DAO keeps its books another way. “Revenue is recognized over the service delivery period, not when the name is registered,” the DAO's quarterly reports say10. A name paid for in one year adds revenue in every year it runs.
On that basis, registration revenue was $6.40 million in the first quarter of 202410. By the first quarter of 2026 it was $2.80 million. Premium sales are 21-day auctions for expired names, with a price that starts at $100 million and drops to $0. That stream brought in $1.63 million in the third quarter of 2025. Returns on the DAO's endowment added $0.50 million in the first quarter of 2026, with March results still pending.
ENS registration revenue fell from $6.40 million in Q1 2024 to $2.80 million in Q1 2026
ENS DAO revenue by quarter and source, counted as service is delivered, in millions of US dollars
- Registrations
- Premium auctions
- Endowment returns
- Height: Revenue, $ millions
Source: ENS (DAO forum) [10].
Read the chart as a table
| Item | Registrations | Premium auctions | Endowment returns |
|---|---|---|---|
| Q1 2024 | $6.40M | $0.82M | $0.96M |
| Q2 2024 | $6.50M | $0.52M | $1.07M |
| Q3 2024 | $4.72M | $0.83M | $0.74M |
| Q4 2024 | $4.49M | $0.68M | $1.05M |
| Q1 2025 | $3.47M | $0.59M | $0.89M |
| Q2 2025 | $2.61M | $0.50M | $0.66M |
| Q3 2025 | $4.51M | $1.63M | $1.04M |
| Q4 2025 | $3.63M | $0.25M | $0.97M |
| Q1 2026 | $2.80M | $1.13M | $0.50M |
The case for a name system
Johnson set out the goal in his 2021 post. “ENS exists to provide the most useful decentralised naming service we can offer,” he wrote4. “That means that we aim to make the system as easy to use and available as possible for end users who register names with the goal of using them to name decentralised resources.”
He treated the fee as the guard. A yearly charge, Johnson wrote, “makes it expensive to squat on a large number of domains in the hopes of reselling them”4. In 2022 he argued against a DAO-run market for names on the same grounds. “But, decreasing friction increases profitability, and I sincerely don’t want to make squatting more attractive and profitable,” Johnson wrote9. “I’m aware not all secondary sales are squatting, but it’s a significant component.”
The case against
Vivek Jayaram, founder of Jayaram Law, made the case for brand owners in a Decrypt column in July 20228. “Just as we saw in the 1990s, squatters are actively gobbling up .eth domain names that contain famous trademarks,” Jayaram wrote. He named nike.eth and amazon.eth, both offered on OpenSea at seven figures.
His sharper point is about courts. “That puts .eth domain names outside of the jurisdiction of ICANN, meaning that any traditional UDRP claim likely would fail due to a lack of jurisdiction,” Jayaram wrote8. UDRP is the process trademark holders use to win back a web domain.
The ENS design bears out his point. Until a name expires, “nothing other than the owner of the name can change its ownership - including the controller smart contracts,” Johnson's 2021 post says4. Jayaram's two remedies, takedown notices and a suit under the U.S. anti-cybersquatting law, each stop short of a forced handover, he wrote8.
What to watch
Each side needs a different number. Johnson's case rests on fees from people who use their names. DefiLlama's monthly count stood at $0.24 million in September 202611.
Jayaram's case gains with each brand name that sells on a marketplace while the trademark holder looks on. Start with the DAO's own books. Its latest report, posted April 15, 2026, covers the first quarter of 202610.
Sources
- Nick Johnson, "ERC-137: Ethereum Domain Name Service - Specification," Ethereum EIPs (eips.ethereum.org), created Apr. 4, 2016, https://eips.ethereum.org/EIPS/eip-137
- Maurelian, Nick Johnson, Alex Van de Sande, "ERC-162: Initial ENS Hash Registrar," Ethereum EIPs (eips.ethereum.org), created Oct. 25, 2016, https://eips.ethereum.org/EIPS/eip-162
- Pascal Thellmann, "Speculators Jump On New Gold Rush Called Ethereum Name Service," Cointelegraph, Oct. 28, 2017, https://cointelegraph.com/news/speculators-jump-on-new-gold-rush-called-ethereum-name-service
- Nick Johnson (nick.eth), "Rethinking the registration/renewal model for ENS," ENS (DAO forum), Feb. 23, 2021, https://discuss.ens.domains/t/rethinking-the-registration-renewal-model-for-ens/378
- ENS (documentation), "ETH Registrar," read Oct. 13, 2026, https://docs.ens.domains/registry/eth
- Gareth Jenkinson, "Crypto exchange adoption boosts ENS registrations to over 2.2M," Cointelegraph, Jan. 2, 2023, https://cointelegraph.com/news/crypto-exchange-adoption-boosts-ens-registrations-over-2-2m
- Jeff John Roberts, "Why ENS and Web3 domain services are a bright spot in crypto winter," Fortune, Feb. 3, 2023, https://fortune.com/2023/02/03/why-ens-and-web3-domain-services-are-a-bright-spot-in-crypto-winter/
- Vivek Jayaram, "Web3 Leads to Cybersquatting 2.0: Here's What Brands Can Do," Decrypt, July 3, 2022, https://decrypt.co/104319/ethereum-name-web3-cybersquatting
- Nick Johnson (nick.eth), "Proposal for ENS DAO to Launch an Official Marketplace Dedicated for Trading ENS Domains (post #14)," ENS (DAO forum), Apr. 29, 2022, https://discuss.ens.domains/t/proposal-for-ens-dao-to-launch-an-official-marketplace-dedicated-for-trading-ens-domains/12196/14
- dylanb, "ENS Revenue Reports," ENS (DAO forum), first post Apr. 15, 2025, read Oct. 13, 2026, https://discuss.ens.domains/t/ens-revenue-reports/20577
- DefiLlama, "ENS fees: .eth registration and renewal costs," read 04:04 UTC on Oct. 13, 2026, https://api.llama.fi/summary/fees/ens?dataType=dailyFees