The Ethereum Name Service’s (ENS) governance token experienced a remarkable 72% surge in value on January 3rd, following commendations from Ethereum co-founder Vitalik Buterin. In a post on X (formerly known as Twitter), Buterin highlighted ENS as “super important,” emphasizing its need to remain accessible and affordable, particularly for users on Ethereum’s layer-2 networks.

Buterin’s Advocacy for ENS and Layer-2 Integration

Buterin recommended that all layer-2 networks, including notable ones like Optimism, Arbitrum, and Polygon, focus on developing trustless, Merkle-proof-based CCIP resolvers. This would allow for direct registration, updating, and reading of ENS subdomains on these networks, enhancing their usability.

Impact on ENS Token Price

Following Buterin’s post, the ENS token’s price soared from a yearly low of $8.50 to an eight-month high of $14.70, marking an impressive 72% increase. Although the price later stabilized around $12.90, this growth highlights the influence of Buterin’s endorsements on cryptocurrency values. ENS had previously reached its peak at $74.25 on November 28, 2021, during the broader crypto market’s peak before entering a prolonged bear market.

ENS: Simplifying Crypto Transactions

The Ethereum Name Service offers a pivotal service in the crypto ecosystem, allowing users to replace complex wallet addresses with more user-friendly “.eth” domain names. This simplification significantly eases the process of transferring and receiving funds on the Ethereum network.

Buterin’s Proposed Harberger Tax

In September 2022, Buterin proposed a 3% “Harberger” tax on ENS domain names. His rationale was to discourage the accumulation of domain names by early adopters solely for profit maximization. This proposal aimed to foster wider adoption and decentralized ownership of ENS addresses, ensuring fairer access for all users.

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