Vitalik Buterin, the co-founder of Ethereum, proposed that the ENS-based domain names should have some improvements, taking into account the demand-based repetitive pricing as well as plugged demand-based periodic pricing. This would, in his viewpoint, would elevate the amount of revenue specified to be given to the ENS (DAO) to operate on significant public products.
Vitalik Buterin Suggests Taxing ENS Domain Names to Enhance the Brand’s Revenue
Considerable popularity has been gained by ENS domain names. At present, there are up to 100,000 entities owning the ENS and are presently utilizing the domain names in the Twitter profiles thereof. Unluckily, several address purchases come from powerful investors focused on flipping the celebrity or company names just to gain profits. According to Buterin, there should be an annual tax implementation on the biggest bid over a domain name.
The co-founder added that, in this way, the holder of a domain name (on having a million dollar bid) requires recompensing a minimum amount of nearly $30,000 on an annual basis to maintain the respective addresses’ ownership. With this, the holders would be persuaded to sell an address to the entities having the intention to utilize it. As per Buterin, the holders of ENS tokens could additionally be advantaged as the funds taken from the respective proceeds would be returned to the decentralized autonomous organization (DAO).
In his words, as it is comparatively cost-effective to purchase the domain names, an additionally sustainable, and consistent revenue model could be provided in this respect. The co-founder disclosed that the ability to elevate the ecosystem of the ENS DAO is limited because of the lower revenue than is required as by 2050 the system could become extremely handicapped. In addition to this, the cheap prices of registration across the country do not provide any cost relief to the consumers.
He moved on to say that unfathomable economic reasons highlight that dependence on the secondary markets turns the domains into additionally expensive as opposed to a finely structured in-protocol mechanism. Hoarding of the addresses counts as an activity due to which brand adoption has been slowed down. The Ethereum-based transfers would turn additionally simple in the case of nations, celebrities, and brands possessing domain names of their own.
Taxation on Domain Names to Offer Benefit to the Ethereum Investors
With the implementation of a fee of up to three percent per annum, the dormant addresses could conveniently go into the big-time players’ hands. Apart from that, the ENS addresses’ ownership would become more decentralized due to this move. Furthermore, in the event that the charges are imposed on the DAO treasury, considerable assistance may be provided to the holders of ENS tokens in the form of a bullish move in the event that this takes place.
ENS is a governance token, which is the position that it currently holds in the system. If there is a significant amount of money in the possession of the DAO, there is a possibility that it will investigate additional opportunities focused on the expansion of the protocol.
