ENS Shifts Strategy, Cancels Layer 2 Launch for Ethereum Upgrade

Ethereum Name Service (ENS) has decided to cancel its plans to launch a layer 2 solution as part of its ENSv2 upgrade, opting instead to implement a revamped protocol directly on Ethereum. According to Cointelegraph, this decision comes in light of a significant reduction in ENS registration gas costs over the past year, attributed to several key upgrades within the Ethereum network. ENS lead developer nick.eth highlighted that Ethereum's layer 1 is scaling more rapidly than anticipated, with the recent Fusaka upgrade increasing the gas limit to 60 million, a twofold rise from early 2025. Looking ahead, Ethereum core developers are aiming for a 200 million gas limit by 2026, a threefold increase from current levels, even before any zero-knowledge (ZK) upgrades are introduced. The Fusaka upgrade, which went live in early December, has been instrumental in reducing gas fees due to its enhanced scaling capabilities for both Ethereum's layer 1 and its layer 2 ecosystems. Initially, ENS had announced its L2 Namechain in November 2024, intending to facilitate easier and more cost-effective domain name registrations through rollups. However, nick.eth noted that the landscape has shifted significantly, making it feasible to build directly on layer 1 rather than pursuing a comprehensive layer 2 solution to cut costs. He remarked that while large-scale layer 1 scalability was not originally part of Ethereum's roadmap, the ecosystem's direction necessitated the development of Namechain. Despite the cancellation of Namechain, ENS remains committed to enhancing performance and utility through ENSv2, which will maintain high interoperability with layer 2 solutions. The lead developer explained that the majority of engineering efforts have been focused on ENSv2 itself, which includes a new registry architecture, an improved ownership model, better management of name expiration, and increased flexibility by assigning each name its own registry. He emphasized that choosing to remain on layer 1 does not preclude the use of layer 2 solutions entirely, as the ENSv2 architecture allows for greater interoperability of layer 2 names. The new registration process simplifies the complexity of cross-chain transactions, ensuring that ENS continues to evolve with the changing technological landscape.