ENS Rallies on Layer 2 Migration Plan

The Ethereum Name Service (ENS) plans to transition to Layer 2 with its forthcoming V2 upgrade, aiming to reduce operational costs, enhance scalability, and support broader use cases for .eth domains.

ENS offers user-friendly blockchain addresses through its .eth domain services. The platform has seen widespread adoption, securing millions of domain registrations and forming partnerships with key players such as Coinbase, GoDaddy, and Uniswap.

The shift to Layer 2 is a response to challenges posed by high transaction fees and limited scalability on the Ethereum mainnet. By leveraging Layer 2 solutions, ENSv2 will lower fees for domain registrations and renewals, making it more cost-effective for users.

The project is evaluating existing Layer 2 networks and may opt to deploy its own bespoke blockchain, according to a post in its governance forum.

The upgrade introduces a hierarchical domain registry system that aims to provide users with greater control over their .eth domains. ENSv2 also includes plans to enhance cross-chain interoperability, allowing .eth domains to operate seamlessly across different blockchain networks.

The protocol’s eponymous ENS token has nearly doubled in the past two weeks and is trading near a two-year high.