ENS Labs has proposed an ambitious initiative to expand the Ethereum Name Service (ENS) to layer-2 scaling protocols, dubbed 'ENSv2'. This move is not just about migrating core parts of the ENS protocol, but rather a comprehensive re-envisioning of the architecture from the ground up, leveraging the team's seven years of experience at the forefront of Web3.

The Ethereum Name Service has millions of .eth names registered and thousands of integrations, including dapps, wallets, top-level domains, and browsers. By expanding to layer-2s, ENS will become more accessible and cheaper to use for a wider range of users. However, ENS Labs has yet to select a specific layer-2 network for the migration.

The primary goals of the expansion, considered in July 2023, are to make ENS more decentralized, enable new use cases and integrations, and overcome constraints of the Ethereum mainnet. Moving to layer-2 offers significant benefits, including lower gas fees for registering and renewing .eth names, more control and customization through a hierarchical registry system, and improved multi-chain interoperability by connecting .eth names across networks.

Eskender Abebe, Head of Product and Strategy at ENS Labs, highlighted that the release of EIP-4844 has made layer 2 networks based on Ethereum vastly more affordable and scalable, which was a significant driving factor for ENS's proposal. ENS Labs plans to submit an executable proposal to request an annual budget increase of 4 million USDC from the ENS DAO to hire additional developers and cover infrastructure costs related to development and deployment.

The proposal was put forward for discussion on the ENS DAO before it goes for a governance vote. The layer-2 ecosystem recently reached a total value locked all-time high of $47.7 billion, coinciding with the ETH price pump. The Ethereum Name Service native token did not react to the announcement and was trading flat on the day at around $26 at the time of writing.

ENS has almost doubled in price over the past fortnight, surging from around $14 in mid-May to hit a three-month high of just under $28 earlier this week. ENS spiked to $80 when it was airdropped to domain holders in November 2021 but remains down 69% from that peak.

In conclusion, the proposed expansion of ENS to layer-2 scaling protocols is a significant step forward in enhancing the accessibility and decentralization of the Ethereum Name Service. With the potential benefits of lower gas fees, more control and customization, and improved multi-chain interoperability, this move could have a profound impact on the future of ENS and the broader Web3 ecosystem.