On November 18, 2025, ENS founder Nick Johnson wrote the following on the forum:
"Political infighting within the working groups has cost the ENS DAO, driving away many dedicated contributors—and more will leave at the end of this term. In its current state, we are heading towards a situation where all serious, dedicated, and capable people are either driven away or prevented from participating, leading to the DAO's leadership falling into the hands of those who either lack experience, are too stubborn to leave, or have external incentives misaligned with the protocol."
Then he added:
"If you're worried I'm talking about you, no, of course not—you're one of the good ones."
This statement, seemingly comforting, is actually the sharpest satire. In an organization that claims to be "decentralized," even the founder must add a layer of protection before criticizing the status quo. This statement itself is a symptom.
I. The Secretary's Rebellion
The story begins a week earlier.
On November 14, 2025, Limes, the secretary of the ENS DAO, published a temperature check proposal with a simple core proposition: terminate the operations of the Meta-Governance, Ecosystem, and Public Goods working groups at the end of the sixth term (December 31, 2025).
In the ENS structure, the secretary is not a menial role. If stewards are the heads of various departments, the secretary is the administrative hub of the entire DAO.
Limes is a long-term participant in the ENS DAO, having served as a steward for four years and secretary for two years. He is a core operator of this system. When such a person proposes dismantling the very structure he is part of, it speaks volumes.
His reasons were direct:
First, there is no incentive to tell the truth here.
"When future funding depends on personal relationships, your incentive becomes not to hurt others' feelings. 'I support your proposal, you support mine' becomes the norm. This model prioritizes psychological safety over the pursuit of truth, and without the pursuit of truth, you only get poor outcomes."
Second, it's impossible to weed out unqualified people here.
"Working groups cannot filter who can participate. Traditional organizations select team members and fire when necessary, while working groups are open by default, accumulating contributors based on availability rather than capability. The reality is, poor contributors drive away good contributors."
His conclusion: These problems cannot be solved by improving processes; they are inherent to the working group structure. Shutting down the working groups is the only way out.
II. The List of Brain Drain
After Limes's post, a contributor named ENSPunks.eth—a lawyer with over ten years of corporate law experience—wrote more尖锐ly:
"The culture is toxic, full of gatekeeping, conflicts of interest, and self-enrichment. When I spoke up about these things, I was dismissed. But the talent that has left tells the story better: programmers, math PhDs, multiple lawyers (including myself), even an astrophysicist. Few realize how hard it is to attract talent of this caliber, let alone why they were driven away."
He gave two specific examples:
One was the charter issue. The DAO paid non-lawyers to draft what was essentially legal work, rejecting a seasoned corporate lawyer who quoted a lower price. The result: three years later, still no charter, wasted funds, and lost talent.
Another was the conflict of interest policy. "Parties with conflicts of interest controlled the policy adoption process, so nothing happened. This is a classic negative feedback loop—there's little room for new contributors to enter."
Then he said something意味深长: "Greater centralization is not the solution for a decentralized treasury. Changing a toxic culture is difficult; it starts with asking questions—unfortunately, asking questions is precisely what contributors are told not to do, even during working group meetings discussing important issues like personal responsibility."
Asking questions is prohibited. These six words say more than any long speech.
III. The Institutionalization of Mediocrity
A month later, another deep participant, clowes.eth, published a more systematic analysis titled "From Stagnation to Structure: Fixing ENS Governance." His observations were calmer, but the conclusions were equally严峻:
"For most of 2025, I attended all the calls for all three working groups every week. Eventually I stopped attending because I felt it wasn't the best use of my time."
His evaluation of the three working groups was: Public Goods did what it was supposed to do—funded some excellent public goods; Meta-Governance did well handling administrative tasks, but few new governance initiatives were fully advanced; Ecosystem provided a platform for展示, but the ecosystem didn't grow significantly.
But what truly concerned him was something else:
"My biggest concern with the three working groups is that there were almost no new participants throughout the year. Even fewer were newcomers who truly engaged in discussions. Sadly, these metrics were never quantified because they were never measured."
An open organization where几乎没有新人真正参与进来 over a year. This data is itself a verdict.
clowes.eth's explanation for this was:
"Decentralized governance simply cannot empower or incentivize those with the skills needed to lead the development of a large protocol. Capable people have many options, and they are expected to operate within a political process with no job security, no long-term continuity, and no real ownership."
In other words,this system selects the wrong people. It selects those willing to play political games, not those truly capable of advancing the protocol. It selects for continuity, but not necessarily capability.
Then he wrote the most precise sentence in this article:
"Participants avoid sharing their opinions because doing so has political consequences. Eventually issues remain unresolved, nothing gets done,mediocrity becomes the norm."
IV. The Distortion of Incentives
Why is this happening?
Let's return to Limes's initial diagnosis:When future funding depends on relationships, your incentive is not to hurt feelings.
This is a classic institutional economics problem, academically called "log-rolling." In an environment requiring repeated cooperation, if you criticize my proposal today, I might not support yours tomorrow. Over time, everyone learns to stay silent, learns "I support you, you support me," learns to keep the truth to themselves.
This incentive structure produces three consequences:
First, adverse selection.
Capable people have choices, they can leave; those with no other options stay and endure. This leads to those with the most truth to tell and the ability to tell it being the most likely to leave. The list of brain drain cited by ENSPunks.eth is evidence.
Second, bad money drives out good.
Limes said it clearly: "Poor contributors drive away good contributors." When an organization cannot淘汰不合格的人, the good ones will vote with their feet.
Third, declining decision quality.
Eugene Leventhal from Metagov mentioned a shocking industry consensus in the discussion: "You can increase the cost of a DAO's service or good by 2-3 times that of a traditional organization, and that's the accepted reality."
This is the so-called "DAO premium"—the cost of decentralization. But the question is, is this cost structural or can it be changed?
V. The Curse of Openness
There is a real paradox here to face.
A participant named jkm.eth said that when he first encountered the ENS DAO, he "was struck by its openness than almost any other DAO." It was this openness that allowed him to enter the ecosystem.
But the problem Limes pointed out lies precisely here: working groups "cannot filter who can participate," "accumulate contributors based on availability rather than capability."
Openness is both the DAO's strength and its Achilles' heel.
In other DAOs, jkm.eth has seen the opposite problem—quality newcomers simply can't get in the door, while insiders who were there from the beginning occupy all the space. But in ENS, the problem went to the other extreme: the threshold is so low there is no quality screening.
This is a dilemma: if you set thresholds, you violate the spirit of decentralization; if you don't set thresholds, you cannot guarantee the quality of participants. And when quality cannot be guaranteed, the good people leave.
VI. The Founder's Dilemma
Nick Johnson is the founder of the ENS protocol and a director of the ENS Foundation. When he said those words—about political infighting driving away contributors, about the DAO heading towards being controlled by the incapable—he was taking a risk.
As the founder, his words carry weight, but also imply greater responsibility. He must find equilibrium between "telling the truth" and "maintaining organizational stability." He chose to tell the truth, but added that protective phrase: "If you're worried I'm talking about you, no, of course not—you're one of the good ones."
The reason this phrase is ironic is that it exposes a fact:Even the founder needs to apologize first for telling the truth in the organization he created.
Nick supported a compromise—"pausing" the working groups, not "abolishing" them. He said "sustainable long-term solutions" are needed, such as having a management company handle the DAO's daily operations. But he also admitted that, as a director, he worries whether the DAO can fulfill its legal obligations in the absence of professional contributors.
This is a pragmatic consideration:When the truth-tellers have all left, who will tell the truth?
VII. Two Camps
The discussion quickly split into two camps.
One side主张: Review first, then decide.
James proposed a "retrospective" proposal, suggesting a comprehensive audit of the ENS DAO's expenditures over the past two years, including grants, service providers, working groups—all spending from the DAO treasury. He believed that before making any major structural decisions, the current state should be understood.
He invited an independent organization called Metagov to host this retrospective, with a budget between $100,000 and $150,000.
This proposal was questioned by Nick: "Spending over $100,000 to find inefficient and unnecessary spending sounds like the setup to a joke, and I hope any reader can see the irony."
James's response: Considering the DAO spends over $10 million annually, $100,000 is only 1%. This is reasonable compared to impact assessments for traditional organizations of similar scale.
The other side主张: Act immediately, learn by doing.
Limes and his supporters believed the problems were already clear and there was no need to spend money and time on a "retrospective." Direct action was the right path.
Someone named 184.eth, an ENS Labs employee, was more direct: "If the 'retrospective' passes, I still strongly support immediately dissolving the working groups—today, regardless. This is necessary to move forward; we can no longer tolerate structures that are publicly recognized as broken and ineffective."
Another steward, slobo.eth, announced that regardless of the outcome, he would resign on January 1, 2026, and would not continue participating in any extended term.
VIII. Who Told the Truth?
In this discussion, one person's remarks are particularly noteworthy.
clowes.eth wrote in his long post:
"ENS Labs is currently the core developer of the protocol. They receive $9.7 million annually from the DAO,授权 to build ENSv2—Namechain. Before the DAO existed, the protocol was built by True Names Ltd, and many of the original founders and early contributors still work at Labs today."
Then he pointed out a fact few dare to say publicly:
"I personally don't doubt there were sincere intentions about decentralization initially. But intentions can only go so far. In practice, Labs' recent actions have not truly advanced governance towards decentralization."
He gave examples: Namechain work remains very opaque; their strategy towards DNS and ICANN is opaque; external contributors have no clear visibility into plans or strategy.
Then he said something even more尖锐:
"If there are legal reasons for Labs to remain private, that's fine—but these things shouldn't be kept secret *from* the DAO. They should be kept secret *on behalf of* the DAO. Right now Labs is that opaque layer. It should be the DAO."
This passage touches on the core contradiction of ENS governance:A DAO that controls the funds cannot truly oversee the entity using those funds.
IX. The Institutional Cost of Truth-Telling
Let's step back and look at the universality of this problem.
The dilemma faced by the ENS DAO is actually a problem faced by all organizations reliant on consensus. In a company, the boss can make decisions and bear the consequences; in a DAO, decisions must go through consensus, butwho bears the cost of telling the truth?
Telling the truth has three costs:
First, relational cost. Criticizing someone's proposal means得罪 that person. In an environment requiring repeated cooperation, this is a real cost.
Second, political cost. Pointing out problems publicly may be seen as "disunified" or "stirring trouble." ENSPunks.eth said he was told not to ask questions in meetings—this is the embodiment of political cost.
Third, opportunity cost. Spending time telling the truth and pushing for change is less rewarding than spending time building relationships and securing resources. In a system with扭曲 incentives, telling the truth is a "thankless task."
When these three costs are high, rational people choose silence. When many are silent, the truth-tellers seem "out of place." Those "out of place" either leave or learn to shut up.
This is the formation mechanism of institutional aphasia.
X. A Deeper Problem
In the discussion, vegayp made an interesting suggestion: "Stewards and service providers should not be able to vote during their term of service."
The logic of this suggestion is: By剥夺 certain people's voting rights, reduce the space for political交易. If you are a steward, you cannot vote for proposals that fund you; if you are a service provider, you cannot vote to renew your contract.
This sounds radical, but it points to a fundamental problem:We assume "more participation = better decisions," but if the participants' incentives are扭曲, more participation might mean more politics.
Traditional companies solve this through hierarchy—the boss decides, bears the consequences. DAOs try to solve this through consensus—everyone decides together, shares the consequences. But the problem is, when "sharing consequences" becomes "no one bears consequences," decision quality declines.
The "operating company" (OpCo)方案 proposed by clowes.eth is essentially about rebuilding a structured, accountable hierarchy within the DAO. He suggested a leadership of three people—one for technology, one for leadership, one for finance—granted real power to hire, coordinate, and execute.
This is a pragmatic solution, but also a compromise:Trading a degree of centralization for execution and accountability.
Epilogue:
The ENS DAO governance crisis is far from over. The retrospective and dissolution proposals are still under discussion; the original proposal has been rejected by the community. It might be February next year before new proposals emerge. Elections are postponed, stewards are choosing whether to stay or leave. Whether this crisis will催生 real reform remains unknown.
But regardless of the outcome,an organization capable of self-reflection, brave enough to dismantle its existing structure, is itself an achievement.
(This article is compiled based on public discussions on the ENS DAO governance forum from November to December 2025. The views expressed do not represent the author's position.)
