ENS: Why are users avoiding .eth registration despite low gas fees on ETH?

  • Register name on Ethereum naming service [ENS] It was at its lowest point in 2022.
  • Revenue fell sharply during the year.

According to the on-chain analytics platform Dune Analytics, Ethereum Name Service [ENS] 2022 closed with the lowest monthly number of .eth domain registrations in a 12-month period.

Domain name purchases on the Ethereum name service began a steady decline after recording a monthly peak of 437,365. Since then, the number of monthly registrations has dropped by 88%.

Source: Dune Analytics

The steady decline in monthly .eth registrations is an indication of the dying interest in domain name services within the web3 ecosystem.

Read Ethereum Naming Service [ENS] Price forecast 2023-2024

ENS domain name purchases are made using Ether [ETH]. Like the price of ether [ETH] Significantly decreased over the year, as well as the cost of gas fees for transactions on the Ethereum network.

One would expect this to increase the number of .eth domain name registrations, as users took advantage of the lower fees. However, doubts about the continued usefulness of this asset class and rising inflation rates have caused users to reduce their spending on domain name registrations.

Source: Messari

More pain to serve the Ethereum name

At 15,683 at the time of writing, monthly primary ENS name registrations closed the year at their lowest.

The ENS Base Name is a unique, human-readable name that is used to identify and locate a specific Ethereum address. With the ENS base name, decentralized applications (dAPPs) can find and display a user’s ENS name when connected to the user’s Ethereum account.

How many ENS can you buy for $1?

On a yearly basis, the number of initial ENS registrations performed per month on the Ethereum name service decreased by 42%.

Source: Dune Analytics

As expected, with demand for .eth names declining, the public protocol finished with the lowest revenue in the past 12 months, data from Dune Analytics showed. Total revenue for new registrations and renewals in December was $1. 52 million. This represents a 73% decrease in protocol revenue on a year-to-date basis, and an 84% decrease from the high of $9.5 million reported in total revenue in May.

Source: Dune Analytics

The original ENS token has fared no better. Data from CoinMarketCap showed that, at $10.76 at the time of writing, its value has declined by 72% in 2022.

Source: CoinMarketCap

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