Despite the pushback from the ENS community. I very much appreciate Vitalik’s thoughts on this subject matter. We’ve thought very long and hard about ENS name ownership pricing over the past 5+ years.
Some personal thoughts on V’s article as well general ENS thoughts:
We explored Harberger tax in 2018, which was researched and written about by ENS OG
The general conclusion is, guaranteeing ownership at least in the medium term is pivotal for a naming system. Vitalik also concludes this in his article
In the ENS workshop in London 2018, an attendee (whose name escapes me) suggested a renewal fee based on registration demand. Although an attractive proposition, we clearly realised this could be gamed and abandoned the idea.
Realistically we couldn’t think of a way to have a self perpetuating pricing system without intervention and create a ungameable pricing system. So finally after much discussion we decided to keep prices accessible, but still charge more for shorter domains.
In hindsight, this may have been too cheap given how quickly 3 letter names have sold out recently. And something that allows dynamic pricing/renewals may release some of these names by pricing out those that aren’t using the names but have to pay high fees.
I still think there is a possibility to do this, but it may be too late to do this and the current system (although favouring humans alive today) works pretty well and has been priced reasonably enough that we are creating adoption and do see a decent amount of expiries.
V’s thesis is more about congestion in the namespace and also allowing more funds to the ENS DAO to fund public goods. I’d argue that accessibility isn’t considered as much and this is as important, if not more important to the goals of the ENS protocol and DAO.
I think that subdomains will be the answer to this. If Vitalik’s prediction that there will no longer be any meaningful .eth names left to register. I think subdomains can take the place of .eth for accessible, usable names that could be either free or very cheap
Subdomains in mind have always been the answer to two things: 1) Congestion in the namespace for valuable names (e.g. 5 letter dictionary words) 2) Rising prices of .eth names on secondary
Vitalik’s idea of “hand off single-letter domain names solely to projects that run some other kind of credibly-neutral marketplace for their subdomains” is an interesting idea that plays perfectly with the new NameWrapper contract.
With subdomains we have a nearly unlimited possibilities and although V mentions that foo.x.eth is a poor substitute for foo.eth, I’d argue that emails such as gmail email addresses are very common and are still prized and it depends on the branding.
You can also look at sites like Twitter. Realistically all usernames are vitalikbuterin on https://twitter.com/ or https://vitalikbuterin.twitter.com. Short and meaningful twitter names are already highly prized and are sought after on secondary markets too.
I also like the idea that V mentions about forcing those registrars to give a percentage of subdomain registration to the DAO. This would create another revenue stream on top of .eth to support the ecosystem and would possibly allow even more general public goods funding
On V’s idea of using bids as an input, it feels quite complicated to me. It would require a cryptopunks-style onchain bid/ask system. And it would probably mean 10s of thousands of bids being posted on-chain.
I feel it would be difficult to change the pricing at this time. However I do think it’s important to remember we are still very early. Ethereum itself is changing its consensus mechanism!
The ENS pricing was always designed to be changed because we knew that we probably wouldn’t get it right the first time and that things may need to change. We should welcome ideas and discussion about the health of the namespace even if they conflict with our personal positions