Vitalik Buterin Says It's Time To Change How Ethereum Name Service Domains Are Priced: Here's Why

Ethereum ETH/USD creator Vitalik Buterin thinks a market-based approach should be employed to determine the prices of Ethereum Name Service (ENS) domains.

What Happened: The cost to register an ENS domain today is a “very cheap” $5, said Buterin in a blog post on Thursday. 

“This sounds reasonable from the perspective of one person trying to register a single domain, but it looks very different when you look at the situation globally," he wrote.

See Also: HOW TO BUY AN ENS DOMAIN

Why It Matters: The fact that a user is able to prepay a small amount for extended ownership – a hundred years – has led to a situation where domain squatters sit on ENS domains and wait for people to buy them at a much higher price, explained Buterin.

“By selling off these domains so cheaply, ENS DAO is almost certainly gathering far less revenue than it could, which limits its ability to act to improve the ecosystem,” he said.

A better way to allocate domains, according to Buterin, would be demand-based recurring pricing, where the fee depends on market demand.

These proposals would maintain total credible neutrality, and provide a high degree of ownership guarantee, but also increase the cost of domain squatting. 

That would raise more revenue for the ENS DAO to be able to work on important public goods, and improve the chances for people to get the exact domain they need, Buterin said.

Price Action: At press time, ETH was trading at $1,666, up 2.3% over 24 hours as per data from Benzinga Pro.

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