With all the hype around ENS domains, you might be wondering if you should invest in one yourself. A quick scroll on Twitter reveals numerous users with their own “.eth” names, only adding to the FOMO that’s already prevalent in the web3 space. After doing some research and investing in my own ENS name, here’s what I’ve learned.
There are several reasons why you might want to consider buying an ENS domain. Here are 11 reasons.
1. You Can Make a Lot of Money
Likely one of the top reasons many people are buying ENS domains is for the potential to make a profit. Considering you can buy a 5+ digit domain for only $5 per year and more premium domains for up to $640 per year, there’s still a lot of room for an ROI.
For example, the ENS name “Paradigm.eth” (originally purchased for $5.62) sold for $1.5 million one year after its initial purchase.
Also, let’s not forget about the “999 Club” (names with 3 digits: 000-999). These particular names commonly sell for thousands of dollars, with the most expensive “000.eth”, having sold for $321,885.
That said, not all ENS names are a good investment. I’d compare buying and selling ENS domains comparable to traditional domain name speculation. Nonetheless, the potential is there.
2. Maps Human-Readable Names to Wallet Addresses
The most obvious use-case for ENS domains is the ability to transform your lengthy and forgettable crypto wallet address into a human-readable and hopefully memorable name.
Similar to how traditional “.com” domains map names into IP addresses, ENS maps names into web3 wallet addresses.
This makes it much easier to send and receive crypto to and from your wallet.
So, rather than sending crypto to my wallet address “0x5d6535d5dd5d187a4770cfae7c899a7f8a32163c”, you can simply input my ENS, “alexgomez.eth”.
This may sound simple, but it is key to the overall success of the development and adoption of web3.
3. ENS Names Are Censorship Resistant
Your keys, your domain. That is, the only way to gain control over your domain is to gain access to your secret phrase, to gain access to the wallet that holds your ENS domain.
Since every ENS domain is an NFT, they are all censorship resistant. That means you maintain complete control over your ENS domain. No entity can access your domain to modify it or take it over.
So, as long as you keep your wallet secure and you learn how to securely store your NFTs, your ENS domain will remain in your control.
This is one of the main differences between DNS and ENS. A traditional “.com” domain can easily be taken down by the web hosting service.
But, since ENS domains live on the blockchain—a decentralized ledger—they are secured by thousands of servers all around the world.
4. You Own Your Web3 Identity
Web3 is all about ownership. NFTs have enabled us to provide truth and transparency regarding ownership of both digital and physical goods, via the blockchain.
Before NFTs, there was no way to prove ownership of a digital asset.
But now, you can. And ENS domains are a prime example. Whether you want to own your brand’s identity or your own, ENS names allow you to do so.
That’s why the New England Patriots bought “Patriots.eth” for $99,000. Now they literally own their brand name.
Furthermore, everything you do on web3 is done via your wallet. Buying, selling, trading, and interacting with decentralized applications can only be achieved through your web3 wallet.
Hence, your wallet is your digital identity. ENS allows you to own it.
5. Owning an ENS Domain is a Huge Flex
Arguably one of the greatest reasons to own an ENS domain is for the flex. Holders who own desirable names are undoubtedly pioneers in the web3 space.
Similar to driving an exotic car or wearing designer clothes, owning an ENS domain is a sure sign that you were early, you made the right moves, and you are to be respected for your conviction.
However, I don’t believe all ENS domains are a flex and I know others would agree. Rather, only the names that hold value or represent something of value are thought to be a flex.
That’s why only a very niche group of domains sell for such large sums of money. With that, there’s no telling when or if a domain name might become valuable.
6. There’s an Entire Community Behind ENS Domains
When you notice someone with “.eth” in their username, you instantly know they are a part of the web3 ecosystem.
Whether a name is considered valuable or not is up for debate, but there’s no denying that if you own an ENS domain, you are instantly connected to other holders.
Additionally, beyond the broad ENS community, there are dedicated sub-groups within the ENS ecosystem. Groups like the 999 Club, 10k Club, and 100k Club are early examples of communities that have formed within the broader ENS community.
Even cultures from around the world have formed their own ENS communities. The Arabic 999 Club and 999 CN (China) Club are both strong communities that actively network, engage, and educate each other.
So, if you want to become part of a large community, ENS domains are a great way to get involved.
7. ENS Supports Importing DNS Names
You can use your ENS with DNS names that you might already own. ENS supports most DNS names including .com, .org, .app, .io, .xyz, and .art.
By visiting your ENS account, you can easily link your ENS domain to your traditional domain. This is important, especially as web3 becomes more prevalent in society.
Remember, we live in an “and” world, not “or”. That said, traditional web2 domains will likely continue to coexist with up-and-coming web3 domains, such as ENS. So, owning and utilizing both is a good idea.
Moreover, DNS domains still do things that web3 domains can’t. For example, Google does not index ENS domains.
So if you were to start a blog using your ENS domain name, Google would not show it in the search results.
Hence, the need for traditional domain names still exists. But, that doesn’t mean you can’t supplement the two with each other.
8. You Can Create Subdomains
For every ENS domain you own, you can create an unlimited amount of subdomains.
These subdomains can be used similarly to your primary ENS domain, except, you can transfer them to others without giving up ownership or control of your primary domain.
For example, using my primary ENS domain “alexgomez.eth”, I can create individual subdomains like “nft.alexgomez.eth” or “dao.alexgomez.eth”.
Why would you want to do this? There are several potential use-cases, such as:
- Wallet companies can issue subdomains to users
- Families can share a single domain with each member of the family
- DAOs could issue subdomains to their members
- You can easily organize and manage various digital assets (NFTs, crypto, etc,) by creating a subdomain for each
Essentially, you can turn your single ENS domain into multiple domain names if you want. Plus, it’s free to do (with the exception of gas fees).
9. ENS Is Deployed on the Most Popular Blockchain
One of the main benefits of ENS is that it’s built on the most trusted blockchain in the industry. If any web3 domain name service has a chance of sticking around in the long run, it’s ENS.
The likelihood that Ethereum will continue to be the preferred blockchain is high, especially considering where Ethereum is headed with its numerous updates which aim to create a more efficient and scalable network.
As long as Ethereum remains in good standing and ENS continues to innovate, the concoction could lead to the overall longevity of ENS.
10. Ethereum Name Service is One of the Earliest NFTs
At the very least, fact remains that the Ethereum Name Service is one of the earliest NFTs ever minted on the Ethereum blockchain.
The initial contract is dated March 10, 2017, meaning it’s the 8th NFT contract to have been minted on the network.
If anything, ENS domains will always have a historical significance associated with them in one way or another.
Of course, new ENS domains are registered daily so that’s not to say that each individual domain is viewed as being historically significant.
But, the infrastructure itself will always remain as such.
11. It’s an Easy Way to Onboard Into Web3
The term NFT has an overall negative outlook associated with it. As a result, those who are looking to dip their toes into web3 are hesitant to start with such an asset.
However, ENS domains provide newcomers with a low barrier to entry and easy to comprehend use-cases. Buying an ENS domain is not the same as buying into an NFT project.
Most NFT projects lack execution or any real use cases that provide value to their holders.
But when you purchase an ENS domain, at least you know there is some instant value you will get from it—such as replacing your complicated wallet address with a human-readable name.
Moreover, ENS domains are affordable for most people considering you can own one for as little as $5 per year.
That means risk remains minimal, while the potential for something great to come from owning an ENS domain name remains unimaginable.
Ultimately, ENS domains are one of the best onboarding assets into the world of web3.
Are ENS Domains Safe?
ENS domains are as safe as the wallet your store them in. Since ENS domains are NFTs minted on the Ethereum blockchain, they are secured by the Ethereum protocol. This means your domain is resistant to censorship and remains in your control. But, if your wallet is compromised your domain is at risk.
That’s why it’s so important to only use the best NFT wallet to store your domain and reduce your risk of being scammed by knowing how to securely store your NFTs.
At the end of the day, your domain is only as secure as you are cautious. One wrong move and your domain could fall into the hands of someone with bad intentions.
That said, if you take the proper steps to secure your asset, there are minimal safety concerns when it comes to ENS domains.
Conclusion
ENS domains are part of a much bigger evolution. The evolution of decentralization, transparent ownership and identity, as well as the overall adoption of web3.
Of course, there are many things to take into consideration before you buy your own ENS domain. But for $5 per year, I think it’s more than worth owning one.