Key Highlights
- ENS Labs is discontinuing its independent Layer 2 project, Namechain, to launch the ENSv2 upgrade directly on the Ethereum mainnet.
- A 99% drop in Ethereum gas fees over the last year made the overhead of maintaining a separate rollup unnecessary.
- The move ensures the naming service retains Ethereum’s core security while using technical gains to simplify the cross-chain registration process.
ENS Labs announced on Friday that it is changing its development strategy, confirming that the upcoming ENSv2 will only be deployed on the Ethereum Layer 1 network. As part of the shift, the organization will stop developing its own dedicated Layer 2, Namechain.
As per a report, the change comes in response to a drop of 99% in gas expenses on Ethereum L1 in the course of the last year. The company attributes this to the scaling of the network, which they state is faster than projected because of improvements such as Fusaka.
Security and decentralization
By dropping the plan for a separate rollup, ENS Labs aims to provide users with the security and decentralization of the mainnet while avoiding the infrastructure issues and centralization risks that come with running a custom Layer 2 chain.
The choice to stick with Layer 1 is influenced by the fact that the median ENS registration costs have fallen from about five dollars a year ago to less than five cents today. This change in costs made the operating expenses and complexity of running Namechain seem unnecessary.
According to the announcement, subsidizing every ENS transaction for a year is now expected to be much cheaper than managing an independent Layer 2. By focusing on the Ethereum mainnet, the developers believe they can offer a simpler resolution process, requiring only one chain for queries instead of two. This should improve the overall stability and reliability of the naming service.
Changing scaling outlook
The development team once thought that creating their own Layer 2 was unavoidable. Two years ago, transactions on the Ethereum mainnet were too expensive for most users, and high L1 scalability was not a key feature on the immediate roadmap.
During that time, the ENS team invested heavily in Namechain, seeing it as the sole solution to meet user demand for low-cost transactions. The project spent the last 18 months designing a new registry system and ownership models tailored for this Layer 2 environment, with much of the roadmap focusing on CCIP-Read gateways to resolve names across different layers.
Course correction
The quick rise in Ethereum’s gas limit, from 30 million to 60 million in 2025 to a target of 200 million in 2026, changed the project’s outlook. In the official post, the team compared their situation to the history of the Concorde supersonic jet. They noted that sometimes the courage to change direction is a sign of leadership.
They stated that if they were starting the project today, given their knowledge of Ethereum’s scaling progress, the answer to whether they would build their own Layer 2 would clearly be no.
Legacy of Namechain
The shift to an L1-only deployment for ENSv2 does not mean the effort on Namechain was in vain. The lessons learned about Layer 2 architecture will be used to make ENSv2 more compatible with other existing Layer 2 networks.
Users can look forward to a smoother registration process that allows for the use of assets from any EVM-compatible chain without manual bridging. Public alphas for the new ENS App and ENS Explorer are available for testing, featuring a new registry design that gives each name its own registry, increasing flexibility.
Future infrastructure goals
ENSv2 will remain tied to the infrastructure support of Ethereum Layer 1. The team favors decentralization over the intricacies of a custom rollup. While there are social and reputational costs to be paid for changing plans, they view remaining on the mainnet as providing the best foundational security.
As Ethereum scales further toward its 2026 gas limit targets, ENS Labs intends to investigate further options for offsetting gas costs for all Ethereum holders to make the service accessible while evolving to its next iteration.
Also Read: We Don’t Need New EVM Chains and Alternative L1 Networks: Vitalik
