Transaction volume surges, why are ENS domain names suddenly so popular?

Speaking of the most popular project at the end of last month, besides BAYC, it is probably the Ethereum domain name service ENS. According to NFTGo.io data, the transaction volume of ENS in half a month reached 45.9 million US dollars, an increase of 2626.43%.

Transaction volume data from April 26 to May 10. Source: NFTGo.io

In addition to transaction volume, other data of ENS also showed a good upward trend. According to Dune Analytics data, the number of new ENS domain name registrations in April was nearly 163,000, setting a historical high. The total number of ENS domain name registrations has now exceeded 1.23 million.

Source: Dune Analytics

So what exactly is ENS that users are rushing to buy? This article will take you to learn about it.

What is ENS?

Before understanding ENS , you need to first understand what a domain name is. In simple terms, a domain name is a digital asset that maps a digital IP address (such as 12.46.53.34) to a more human-readable name (such as xx.io). A domain name can be said to be a code for an IP address, and its purpose is to facilitate memorization.

ENS is a domain name registration protocol, the full name of which is Ethereum Name Service. Based on the understanding of domain names, it is easy to infer that ENS can map an Ethereum address to a more human-readable domain name. The best example is that Ethereum founder Vitalik Buterin used vitalik.eth instead of his original 42-digit wallet address.

It is worth noting that Vitalik Buterin once said in a previous interview that Ethereum Domain Name Service ENS is the most successful non-financial Ethereum application to date, and can basically be compared to a decentralized phone book. In addition, Vitalik Buterin also pointed out the value of three- and four-letter ENS domain names two years ago.

Source: Vitalik Buterin Twitter

Analysis of the reasons for the explosion of ENS domain names

So why have ENS domain names suddenly become popular recently? After understanding, the editor summarizes several reasons:

1. In fact, the ENS domain name explosion began on April 26. So what happened on that day? On April 26, BAYC holders suddenly proposed that they could have ENS domain names that matched their digital numbers. With the support of the BAYC community, ENS domain names began to be registered in large numbers, especially three-digit and four-digit domain names.

2. Under the above circumstances, many BAYC holders purchased ENS domain names. Then, the holders of ENS domain names 0-9999 created a club called 10kclub, which instantly made the domain name a hot topic.

3. Many projects have indicated that they will directly airdrop to the addresses of ENS domain names. For example, on April 27, the Web3 social protocol Linkkey announced that it would issue airdrops to ENS users. On April 27, the sales and registrations of ENS domain names began to increase significantly again. It can be seen that Linkkey's announcement of airdrops played a driving role.

In summary, the holders of the blue chip project BAYC have given ENS a lot of enthusiasm, and it has even evolved into a community MEME craze. Coupled with the promotion of many airdrop projects and the participation of industry leaders, the ENS domain name has continued to receive attention, thus attracting more investors to become followers of fomo sentiment.

However, many historical trends tell us that the popularity driven by these fomo emotions is only temporary. Therefore, the more popular the ENS domain name is, the more investors need to calmly analyze the market environment and not blindly follow the trend.