ENS DAO drama intensified after Ethereum developer Christoph Jentzsch proposed dissolving the governance structure and transferring its treasury to an outside steward following a contentious dispute over the Security Council.
ENS DAO faces competing governance proposals
Christoph Jentzsch, a veteran Ethereum developer who holds no formal role in ENS governance, suggested winding down the ENS DAO and placing its treasury under the control of an external caretaker.
His proposal emerged one day after ENS co-founder Nick Johnson used roughly half of the protocol’s active voting power to block an on-chain proposal that would have renewed the DAO’s Security Council.
The debate represents the third governance direction currently under discussion. The other two proposals were introduced by ENS Labs Chief Operating Officer Katherine Wu.
Johnson explained that he had abstained during an earlier non-binding vote while supporting renewal in principle but opposing the existing council membership.
When the binding on-chain vote took place, he voted against the proposal because, according to him, none of his concerns had been addressed.
Jentzsch proposed gradually shutting down the DAO over a period of six to eighteen months while removing all administrative authority from its smart contracts.
He suggested transferring the remaining treasury assets to an external organization such as the Ethereum Foundation or the newly established Eth Labs to oversee future development.
Treasury debate grows after Security Council vote
The Security Council has authority to cancel governance proposals after community approval but before execution during the protocol’s timelock period.
Jentzsch also suggested either burning treasury funds to discourage domain squatting or reducing registration fees to zero, although he acknowledged that lower fees could increase squatting.
He later admitted his proposal contained some technical gaps but maintained that the overall concept deserved consideration.
Another community participant, Ariutokintumi.eth, proposed adopting demand-based pricing for ENS domain registrations as part of broader governance reforms.
Johnson’s vote prompted criticism from several community members. Lefteris Karapetsas, founder of Rotki, wrote on X that the DAO was now “dead,” arguing Johnson’s voting power effectively protected a treasury valued at approximately $500 million without meaningful external oversight.
Community weighs reforms before nomination deadline
Delegate Spengrah.eth also expressed concern that ENS Labs appeared positioned to control both daily operations and the Security Council, arguing the DAO “looks like it has been captured.”
According to DeFiLlama, the ENS treasury holds approximately $350 million in assets, or about $88 million excluding ENS tokens owned by the DAO.
The ENS token traded slightly above $4 this week, giving it a circulating market capitalization between $166 million and $169 million, more than 95% below its November 2021 peak of $85.69.
Wu separately proposed replacing the Security Council with eight newly selected members while raising the threshold for canceling time-locked proposals from four to five votes.
Johnson supports that proposal and nominated himself for the new council before nominations close on July 3.
Another restructuring proposal from Wu would transfer treasury management, grants, and daily operations to the ENS Foundation while leaving protocol decisions with tokenholders.
