ENS tokenholders approved and executed a proposal that turns the ENS Foundation into a staffed organization with a full-time executive director, a five-seat board, and onchain control of the DAO's endowment.
The dispute focused on key control. The executable changed the sole owner of the Endowment Safe to a new timelock contract with a nine-day delay. That timelock has only one proposer, the Foundation's 3-of-5 multisig, while the Security Council can cancel queued transactions with five of eight signatures. Spending caps, budget limits, and conflict-of-interest recusals appear in the proposal text, but they are not enforced by code.
Who controls the endowment
The endowment holds roughly $65 million in ETH and stablecoins. The nine-day delay applies only to the owner path. Two pre-existing module paths remain in place after the swap, according to a calldata review by governance security firm Blockful.
- One is karpatkey's Roles v2 module, which handles day-to-day investment management.
- The other is a Safe allowance module that gives the meta-governance working group multisig 30 ETH every 25 days.
The 1 million ENS transfer included in the same proposal is also exempt from that delay.
The vote closed with 1,269,420 ENS in favor and 480,690 against, clearing the 1 million-token quorum, and was executed early Tuesday. Votable ENS supply stands at 7.1 million tokens out of a total supply of 100 million.
Fire Eyes DAO cast the largest block of opposing votes at 154,548, followed by Van de Sande with 130,335 and brantly.eth with 93,835. The article identified brantly.eth as the ENS Foundation director the DAO voted to remove in 2022.
1 million ENS moved to the Foundation, while the DAO keeps other balances
The proposal was authored by delegate katherine.eth and submitted onchain by ENS founder Nick Johnson. It transfers 1 million ENS to the Foundation Safe, restricted to employee compensation under a published framework with multi-year vesting. At ENS's current price, that stake is worth about $4.2 million.
The remainder of the DAO's roughly 54.6 million ENS stays under tokenholder control. The operational wallet, which holds about $16 million in ETH and stablecoins, also remains under DAO control.
Transfers from the endowment to the Foundation are capped at $500,000 for standup costs until the executive director publishes a projected budget. The first annual budget is due within 60 days. Independent directors will be paid 40,000 USDC a year.
Prose versus calldata
Alex Van de Sande, an ENS co-founder who sits on the Security Council, said he entered the vote leaning toward support and changed his mind after verifying the deployed contracts.
He wrote, 「None of these addresses appear in the proposal text (voters are approving a swapOwner to an undocumented destination), and after 2028 the veto can only be reinstated if the Foundation itself queues the grant — the watched party controls the renewal of its own watchdog, while the custody transfer has no expiration.」
The Security Council's cancellation role expires on Aug. 7, 2028, after which anyone can strip it. Both Van de Sande and Blockful flagged the missing addresses. The proposal includes an Aug. 3 edit that adds them.
Van de Sande also wrote, 「The draw limits, budget bounds, and the $500k standup cap exist in prose only — the executable enforces none of them.」
He said the change also flips the relationship with the endowment manager, giving the Foundation the power to rescope, replace, or remove karpatkey, authority that currently sits with the DAO.
Before the vote closed, he asked for one transaction to be made first: granting the DAO's operational wallet a proposer role on the new timelock. He said that would shift the design from 「the DAO is removed as owner」 to 「the Foundation is added alongside the DAO.」
Delegate gregskril rejected that request, writing that 「the Foundation would be able to cancel transactions from the DAO in this setup so it's not really useful」 and that a DAO transaction to the Endowment Safe would take 18 days. A design he described as better, splitting permissions so the DAO could extend or replace the Security Council contract, would require a code change and an audit that 「likely cannot happen before this proposal concludes.」
Alexander Urbelis, the Foundation's incoming executive director, accepted the documentation criticism. He wrote, 「Agreed about the addresses. They should have been named in the proposal text, not left to be decoded from calldata,」 and said he would stagger independent director terms in the bylaws and queue the Security Council renewal no later than six months before it expires.
Van de Sande did not change position. He wrote, 「Reinforces the idea that this is a very big onchain change that is not ready to be executed and shouldn't be an executable yet. Will not change my vote.」
How the five-seat board is structured
Urbelis will take the executive director seat from his current role as general counsel and CISO of ENS Labs. He previously served as CISO of the NFL and CCO of Richemont. He is also a signer on the Foundation Safe.
Johnson holds a Founder seat that passes to an ENS Labs representative if he leaves. He is recused from votes on ENS Labs funding.
The three independent directors serve two-year terms that tokenholders can renew. They are Kartik Talwar, general partner at A.Capital Ventures and an ETHGlobal co-founder; Brett Sun, a Prelude co-founder who led technical work at Aragon; and Anthony Leutenegger, CEO of Aragon and a delegate at Lido and Morpho.
Trademarks and intellectual property move into the Foundation
ENS Labs said in a post announcing the structure that ENS trademarks, brand assets, and other intellectual property will be consolidated in the Foundation. The Foundation will represent the protocol at ICANN, IETF, and W3C and pursue recognition of the .ens top-level domain.
Under the proposal, the Foundation will license those trademarks back to ENS Labs. ENS Labs remains a separate Singapore entity and keeps responsibility for core protocol development, including ENSv2.
The same document says the service provider program will be absorbed into the Foundation's grants program and the working groups will wind down.
The governance fight before the vote
The vote followed a governance battle that broke into the open in June, when Johnson used roughly 3.26 million self-delegated ENS, about half of all delegated tokens, to defeat the Security Council's renewal.
That move prompted Christoph Jentzsch, a contributor to the original 2016 DAO who now runs Tokenize.it, to propose that the DAO dissolve itself. A replacement council was seated in July with a 5-of-8 cancellation threshold and a mandate lasting until July 2028.
Delegate Lefteris Karapetsas, who said the forum post would be his last, wrote that the revised proposal ignored community feedback. 「The foundation is still a pet foundation owned by ENS Labs,」 he wrote. 「ENS is now just ENS Labs.」
Delegate bcvfinance.eth argued that ENS Labs holds close to 4 million ENS, enough to represent a majority of active voting power, while also remaining the DAO's largest funding recipient. He wrote that 「revenue has declined, expenses have increased, profitability has weakened, protocol adoption has deteriorated, and active voting power has become more concentrated.」
Johnson disputed that characterization. 「You write this as if ENS Labs simply happened across the DAO and started offering its services, when in fact ENS Labs is the entire reason ENS exists in the first place,」 he wrote. 「The metrics you are complaining about — which largely reflect the state of the overall crypto ecosystem — would all be 0 if ENS Labs hadn't been here to build it.」
Token trades near its all-time low
ENS registration and renewal fees, which the DAO keeps in full, generated $228,329 over the past 30 days and $4.98 million over the past year, according to DefiLlama. The 30-day figure implies an annualized pace of about $2.7 million. Cumulative protocol revenue since launch stands at $112.3 million.
ENS traded at $4.16 on Tuesday for a market capitalization of $174.9 million, about 5% above the all-time low of $3.94 set on June 26 and 95% below its November 2021 peak.