$ENS token holders have ratified the "Next Era $ENS DAO" proposal and launched the executable code on the blockchain, creating the $ENS Foundation as a working organization with a paid executive director, employees, and a five-member board of directors, $ENS Labs announced in a blog post on August 11.
This change provides $ENS with its first legal entity capable of holding meetings where the DAO cannot. Furthermore, this entity will handle day-to-day operations, while token holders will continue to control the protocol.
Why the DAO Could Not Sign Documents
According to data from $ENS Labs, the DAO is not qualified to sign standardization agreements, hire full-time employees, sue a trademark owner for a phishing clone, or respond to legal inquiries.
Until now, most representative work remained undone, with some of it being handled by $ENS Labs; however, given that the company primarily specializes in engineering development, it was not prepared to objectively assess this role.
Now that the Foundation has been launched, $ENS Labs states it can focus on development, including the upgrade to ENSv2.
The Foundation has been tasked with taking on the off-chain computational workload. It can now join discussions with ICANN, IETF, and W3C and pursue recognition for the .ens top-level domain.
As a legal entity, it is also responsible for engaging with regulators, registrars, standardization bodies, and courts. Additionally, its duties include consolidating the $ENS brand's trademarks and assets to be able to combat impersonators.
What $ENS Says About Where the Money Remains
$ENS DAO's share of the total token supply is 54.6%, and it will continue to be under the control of the DAO, which includes token holders.
The Foundation, funded by revenue from .eth domain registrations, stores its assets in its own accounts; however, its transactions are now subject to a nine-day lock.
During these nine days, the $ENS Security Council can cancel any transaction that falls outside the Foundation's mandate.
The same post emphasized that the $ENS Foundation and $ENS Labs are not legally identical, and each functions as a separate legal entity. The Foundation does not own $ENS Labs, and the latter has no governance rights over the Foundation, its funds, or the protocol.
The closest ties the labs have with the Foundation are that the founder holds a seat on the Foundation's five-member board of directors; however, he does not participate in decisions regarding funding for the labs.
Who is on the $ENS Foundation's Five-Person Board of Directors?
The inaugural board includes Alexandre Urbelis, a cybersecurity attorney who previously held the roles of Chief Legal Counsel and Chief Information Security Officer (CISO) at $ENS Labs, and served as CISO for the NFL, and now holds the position of Executive Director.
Nick Johnson, founder and CEO of $ENS Labs, holds the founder seat.
The board consists of the remaining three Ventures and ETHGlobal; Brett Sun, co-founder of Prelude; and Anthony Leutenegger, CEO of Aragon. Kartik Talwar from A.Capital
Board directors will serve for two years, and their terms may be renewed by token holders.
The update from $ENS comes in a year already marked by some governance conflicts on the platform. In June a proposal for an interim review aimed to restructure their operations with a focus on the DAO and the foundation.
Johnson, the CEO, who owns approximately 3.26 million $ENS (equivalent to US bonds), has also been a source of some controversy, as, given the size of his holdings, he has the ability to influence the course of voting. This occurred when, reportedly, at the end of June, he managed to secure around 80% of votes against extending agreements with the Security Council.
They later approved a new eight-member council with a stricter requirement of 5 out of 8 votes for a two-year term.
Currently, $ENS is trading at approximately $4.12, down over 1.9% in the last 24 hours, according to CoinMarketCap data. It is now more than 95% below its peak of $85.69 reached in November 2021.
