Vitalik Buterin's Praise Drives ENS Token Price Up 80%

Founder of Ethereum, Vitalik Buterin's glowing remarks have propelled the price of ENS tokens to skyrocket to its highest level since April 2023.

Vitalik Buterin's Praise Drives ENS Token Price Up 80%. Photo: VOI

ENS, the governance token of the Ethereum Name Service project, surged more than 50% overnight (04/01) following comments from Vitalik Buterin.

Sharing on his Twitter account, the Ethereum founder wrote:

"All layer-2s building on CCIP (Cryptographic Claimed Identifiers Protocol) infrastructure will enhance convenience and accessibility for managing ENS subdomains directly on these blockchains. ENS is crucial and needs to be more affordable."

Vitalik believes that layer-2 solutions like Optimism (OP), Arbitrum (ARB), and Polygon (MATIC) are pivotal for Ethereum's long-term scalability. Therefore, he encourages these blockchains to integrate with ENS domains to upgrade the user experience in decentralized finance (DeFi) spaces.

Immediately after Vitalik's tweet, the ENS token price surged by a staggering 80%, leaping from around $8.5 to $14.9. This marks its highest price since April 2023.

ENS trading volume also spiked to $167 million, a 650% increase from the previous night. At the time of writing, the ENS price is adjusting in line with the broader market trend, trading around $11.98.

1-hour chart of ENS/USDT trading pair on Binance. Photo taken at 09:05 AM on 04/01/2024

The Ethereum Name Service provides domain services on the Ethereum blockchain, simplifying the process of transferring funds and replacing complex wallet addresses. The project gained prominence with a $500 million ENS token airdrop event in November 2021.

Fundamentally, each domain is an NFT created on Ethereum, used to identify the holder. Users can choose names for .eth domains, mint them, and pay fees to the Ethereum Name Service for a specified period. Currently, there are over 2.1 million minted ENS domains, with 800,000 owners, according to Dune Analytics.

Approximately 800,000 users currently own ENS. Source: Dune Analytics

In September 2022, Buterin suggested a 3% tax on ENS domains in the "Harberger" proposal. According to Vitalik, this would prevent domain hoarding among early users seeking to maximize profits, potentially democratizing the service and decentralizing ENS addresses.