Why is ENS so important for Crypto mass adoption

Why is ENS so important for Crypto mass adoption

By PKcrypto | Point of Crypto | 5 Jun 2020


When you want to visit a website, you don’t type the IP address of the website you’re trying to reach (i.e. 209.97.155.239). Instead you enter the website’s domain name into your browser (i.e. https://www.publish0x.com/). You’re able to do this because of the Internet’s DNS, or Domain Name Service. The domain you typed is located in the DNS registry and you’re redirected to the correct address. In the early days of the web, to access a website you needed to type in the IP address, a string of numbers that were difficult to remember and almost impossible to guess. DNS keeps the record of all domain names and the associated IP addresses. When you type in a URL in your browser, DNS resolves the domain name into an IP address. In other words, DNS is a service that maps domain names to corresponding IP addresses.

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Cryptocurrency is still very much in the IP address phase: users need long, difficult to remember addresses in order to access the services they need, it is too easy to make a mistake, accidentally mislay funds or interact with the wrong thing and all this complexity, is one of the big obstacles towards cryptocurrency mass adoption. Addresses are generated from taking a 256 hash of public key and looks like this:

0xDAb148614f22dDa800cF006Be7932eeEB75AC644

It’s really easy to mess up entering an address. If one digit is wrong or mixed up, then either the transaction will fail or be sent to a wallet where the funds will be unrecoverable. While copy pasting typically ensures the digits are written correctly, hackers have developed viruses that switch out the real address for a fake one.

QR codes are a great solution for mobile, but can’t typically be used by desktop.

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That's where the Ethereum Name Service comes in. It wants to make using crypto as easy as surfing the web. Being able to type in a human recognizable name and verify it as the correct name is a huge advantage.

The ENS allows users to register .eth domain names, which can be used in supporting Ethereum wallets and clients. Names are reserved by placing a deposit in a smart contract and can be mapped to any Ethereum addresses. So rather than sending funds to 0x8cd…0935, one would simply need to type a memorable name like alice.eth into their wallet. Backed by the Ethereum Foundation, ENS will likely become the defacto standard for name registration in Ethereum.

Much like DNS web domains, ENS domain name owners choose where their domain name redirects to. Say just want an easy way for everyone to send you ETH. Just register a domain and set it to redirect to your Ethereum wallet address. Owners can also choose to issue subdomains like payments.alice.eth. Services will often issue subdomains to users making it easier for them to into act with their smart contracts. 

Within the ENS, names are represented as hex addresses while, to the user, a human-readable name is presented. ENS developers shed light on how it works stating: “For example, the namehash of 'alice.eth' is 0x787192fc5378cc32aa956ddfdedbf26b24e8d78e40109add0eea2c1a012c3… Starting with the namehash of any domain - for example, 'alice.eth' - it's possible to derive the namehash of any subdomain - for example 'iam.alice.eth'.” ENS runs similarly to the Internet’s DNS, in that it has a hierarchical system that allows the domain owner total control of any subdomains. So satoshi.eth can create wallet.satoshi.eth and blog.satoshi.eth.

In the sense of internet domains, as managed by ICANN, ENS is not a domain system. While it can be used in a similar fashion on apps that replicate browser functionality, like Mist or Metamask, there is no claim on the “.eth” top-level domain system, which can only be managed by ICANN.

ENS does not grant a trademark or any sort of claim on ownership: registering an ENS name is a fully automated process and does not indicate ownership of any given trademark, copyright, brand name or any other kind of intellectual property.

In terms of architecture, the ENS is composed of two main components. These are the registry and the resolvers. The registry is a single smart contract that holds the records of all domains and subdomains on the Ethereum blockchain. For each domain, and subdomain the registry smart contract holds three types of information. These three data sets are the owner of the name, the resolver, and the caching time-to-live for all records under the domain.

You can register a .eth domain almost instantly through a short process. Using an Ethereum wallet like MetaMask, you can visit manager.ens.domains to search for an available domain name. Once you have found your domain, the system will walk you through registration, which will require you to confirm two transactions from your wallet. You will also have to select how many years you want to register a domain with rent costing $5.00 a year. Now, as the owner of that domain you can set up the different addresses or information you want that name to link through as well as any subdomains.  

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With ENS you can replace your long, unreadable Ethereum address with a friendly, memorable ENS address such as johnny.eth. This makes it easier to receive crypto assets as well as enter your ENS address into Ethereum Dapps without needing to copy and paste a long public address.

Each name registered requires depositing some amount of ether directly into its respective registrar contract for a minimum duration of one year, thus no central entity receives the funds. All ether deposited to contract deeds are then temporarily locked until the end of the auction.

The process of claiming a name takes five days and requires multiple transactions that are time sensitive and often irreversible, so it will be important for you to fully understand the process to ensure you do not irreversibly lose your ether. 

The ENS was launched in 2017. And recently, the ENS added multi-coin support, which means you can use one ENS address to accept and receive not only payments of ETH but also BTC, BCH, LTC, and many others cryptocurrencies. In fact,  the name Ethereum it's because it's a naming system built on Ethereum, not because only for Ethereum. But the development does not stop here. The ENS ecosystem has been exploding in recent months. A combination of multi-coin support, the release of shorter .ETH names, a viral trend of putting your .ETH name in your Twitter profile, and a growing list of things you can do right now with your ENS name have all led to many more wallets and dapps adopting ENS. 

The viral trend also prompted some great discussion about ENS and privacy.

Here’s the concern: When you share your ENS name with someone or with everyone by putting it in your Twitter profile, you are linking all of the cryptocurrency addresses in that ENS name’s records to your personal identity. Since anyone can look-up the entire transaction history of any of those addresses with a block explorer, you may be inadvertently sharing your entire cryptocurrency financial history with the world.

Some people have pointed out that you can simply use the addresses attached to your ENS name for receiving but keep your main cryptocurrency stash in other wallets. While that’s true, if you receive cryptocurrency with the addresses in your ENS records and then transfer to your main stash, you may still be exposing your main stash to the world.

Anyway, privacy is really important and the point here, is this: be aware of what you’re revealing, and be careful.

Although having a unified naming system in the future, will certainly be better, also other main project are implementing a crypto naming system. For instance, DASH is working on a naming service known as the Dash Platform Name Service (DPNS). 

In conclusion, the human brain is used to simple and memorable elements, not complicated set of characters. Humans are good at remembering a few complex chunks of information while computers are good at remembering many simple chunks of information. From a practical perspective, that means that people are more likely to use something in a context they understand, or something that is emotionally important for them. This is why we must improve and simplify the crypto management for the users. The Ethereum Name Service, brings readable address to the public and this is a key step, towards cryptocurrency mass adoption

 


PKcrypto
PKcrypto

Software engineer // Fintech // Blockchain enthusiast // Crypto Investor


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