ENS tokenholders have passed a governance proposal to turn the ENS Foundation into a fully functioning organization and give it control over a $65 million endowment.
Under the proposal, the foundation will set up a five-member board with real financial decision-making and administrative authority. That changes the ENS Foundation from what the article described as a name-only body into an entity with operational power.
From nominal body to operating organization
Before this vote, the ENS Foundation had a limited role. It was nominally responsible for brand stewardship, legal matters and community coordination, but core governance authority sat with ENS DAO, where ENS tokenholders made decisions through onchain votes. The foundation itself did not have independent decision-making power.
That changes in three ways after the proposal passed.
- A five-member board will be created from representatives selected within the DAO community to handle daily operations and decisions.
- The board will manage the $65 million endowment, including investment, allocation and spending decisions, instead of routing each action through a DAO vote.
- The foundation will function as a formal legal and financial entity that can sign contracts and bear responsibility.
The shift moves ENS away from a fully decentralized DAO structure and toward a hybrid model. Major protocol changes remain with the DAO, while day-to-day operations and treasury management move to a dedicated team.
What the $65 million endowment is
The ENS endowment was built over time through donations from ENS ecosystem participants, including early investors, corporate sponsors and individual tokenholders. The article compares its purpose to a university endowment or a nonprofit foundation fund in traditional tech circles. It belongs to no individual and is meant to provide a stable source of long-term funding for the ENS protocol.
The proposal summary highlights several key points:
- The endowment totals $65 million.
- Control shifts to the ENS Foundation board after the vote.
- The governance structure becomes hybrid, with the DAO retaining major decision-making authority and the foundation taking on daily operations.
According to the article, the fund can be used for ENS protocol development and upgrades, expansion of the .eth ecosystem including integrations, tools and applications, projects tied to identity verification and decentralized identity, and legal compliance and regulatory response.
Why the vote matters
The source article points to three reasons this governance change stands out.
First, it presents a possible template for how Web3 foundations might operate. The article mentions DAOs such as Uniswap, Aave and MakerDAO as examples of protocols with large treasuries that are often locked into governance-heavy processes, where spending can require repeated votes. ENS is now trying a model in which the DAO supervises while the foundation executes.
Second, the arrangement reflects a trade-off between efficiency and decentralization. Handing day-to-day decision-making over a $65 million fund to a five-person board amounts to an acknowledgment that fully decentralized governance can run into practical limits. The article frames this not as a failure of decentralization, but as an operational adjustment for a more mature protocol.
Third, the article connects the move to ENS’s internal governance disputes. BlockTempo previously reported in July that an ENS co-founder had proposed delegating 5 million ENS to dilute the voting power of a single large holder. That dispute exposed voting power concentration inside ENS DAO. In that context, moving routine decisions to the foundation can also reduce reliance on repeated DAO votes and lower the frequency of governance clashes.
What to watch next
The article says the next points to watch include the identities and backgrounds of the five board members, the investment strategy for the $65 million endowment, and which major powers remain with the DAO, such as protocol upgrades, removal of board members or freezing funds.
As presented in the source, the ENS restructuring is a case of Web3 governance moving from an idealized model toward a more operational one. How well the hybrid structure works from here will be closely watched by other DAO communities.