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

The move is significant for Ethereum's layer-2 networks, which have seen increased adoption recently, with a record high in total locked assets.

ENSv2 aims to revamp the protocol by introducing a hierarchical registry to enhance management and customization of .eth domain names. The upgrade involves migrating ENS' core functions from Ethereum Layer 1 to Layer 2, offering users scalability improvements, reduced gas fees, and faster transaction speeds. Developers will benefit from a more flexible registry design and other infrastructure enhancements, including multi-chain interoperability.

Although ENS did not specify the exact Layer 2 network for migration, the organization stated on social media that they have been actively monitoring the Layer 2 ecosystem and are ready to begin migrating parts of ENS, such as .eth name registration, to Layer 2.

Meanwhile, Ethereum layer 2 networks have seen a surge in total locked assets, reaching a record $47.26 billion, up 15% in the past week according to L2Beat data. Leading networks include Arbitrum with $19.3 billion in total value locked (TVL), followed by OP Mainnet with $7.88 billion, and Base with $6.94 billion, among others. This milestone reflects growing investor confidence in Ethereum's ecosystem and the widespread adoption of layer 2 solutions, fueled in part by recent ETH price increases and the approval of ETH ETFs.