ENS Labs, the non-profit behind the Ethereum Name Service (ENS), proposed an ENSv2 upgrade to transition the protocol to a layer 2 network, as per a statement on May 28 shared with CryptoSlate.

The ENSv2 upgrade aims to introduce a hierarchical registry to improve the management and customization of .eth domain names, moving ENS's core functions from Ethereum Layer 1 to a Layer 2 network. This shift will enhance scalability, reduce gas fees, and speed up transactions for users, while offering developers more flexibility and enabling multi-chain interoperability.

Although the specific Layer 2 network for migration was not named, ENS mentioned on social media their long-term observation and contribution to the L2 ecosystem, including innovations like CCIP-Read and the EVM Gateway.

Layer 2 networks have seen significant growth, with L2Beat data showing the total value locked (TVL) reaching a record $47.26 billion. Arbitrum leads with a TVL of $19.3 billion, followed by OP Mainnet at $7.88 billion and Coinbase-backed Base at $6.94 billion. Other networks like Blast, Mantle, Linea, and Starknet also have TVLs exceeding $1 billion. This growth is attributed to increased investor confidence in Ethereum's ecosystem and rising adoption rates, along with recent ETH price increases driven by the ETH ETF approval.