$ENS tokenholders approved and executed a proposal that turns the $ENS Foundation into a staffed organization with a full-time executive director and a five-seat board, and hands it onchain control of the DAO’s endowment.
The opposition centered on the keys. The executable swapped the sole owner of the Endowment Safe for a new timelock contract with a nine-day delay whose only proposer is the Foundation’s 3-of-5 multisig, with the Security Council able to cancel queued transactions on five of eight signatures. Spending caps, budget bounds and conflict-of-interest recusals live in the proposal text and are not enforced by the code.
Who Holds The Keys
The endowment holds roughly $65 million in $ETH and stablecoins. The nine-day delay covers the owner path only. Two pre-existing module paths survive the swap, according to a calldata review by governance security firm Blockful: karpatkey’s Roles v2 module, which handles day-to-day investment management, and a Safe allowance module giving the meta-governance working group multisig 30 $ETH every 25 days. The 1 million $ENS transfer in the same proposal is also exempt.
The vote closed with 1,269,420 $ENS for and 480,690 against, clearing a 1 million-token quorum, and executed early Tuesday. Votable $ENS supply is 7.1 million tokens out of a 100 million total. Fire Eyes DAO cast the largest bloc against at 154,548 votes, followed by Van de Sande with 130,335 and brantly.eth, the $ENS Foundation director the DAO voted to remove in 2022, with 93,835.
The proposal, authored by delegate katherine.eth and submitted onchain by $ENS founder Nick Johnson, 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 balance of the DAO’s roughly 54.6 million $ENS stays under tokenholder control, as does the operational wallet holding about $16 million in $ETH and stablecoins.
Transfers from the endowment to the Foundation are capped at $500,000 for standup costs until the executive director publishes a projected budget, with the first annual budget due within 60 days. Independent directors are 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 came into the vote leaning toward support and changed his mind after verifying the deployed contracts.
“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,” he wrote. The Security Council’s cancellation role expires on Aug. 7, 2028, after which anyone can strip it. He and Blockful both flagged the missing addresses; the proposal carries an Aug. 3 edit adding them.
“The draw limits, budget bounds, and the $500k standup cap exist in prose only — the executable enforces none of them,” Van de Sande wrote. He also said the change inverts the relationship with the endowment manager, handing the Foundation the power to rescope, replace or remove karpatkey, which today sits with the DAO.
He asked for one transaction before the vote closed — granting the DAO’s operational wallet a proposer role on the new timelock — which he said would turn the change “from ‘the DAO is removed as owner’ into ‘the Foundation is added alongside the DAO.'” Delegate gregskril rejected it, 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 called better — separating permissions so the DAO could extend or replace the Security Council contract — would need a code change and an audit that “likely cannot happen before this proposal concludes.”
Alexander Urbelis, the Foundation’s incoming executive director, conceded the documentation point. “Agreed about the addresses. They should have been named in the proposal text, not left to be decoded from calldata,” he wrote, and committed to staggering independent director terms in the bylaws and to queuing the Security Council renewal no later than six months before it expires.
Van de Sande did not move. “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.”
Board Of Five
Urbelis takes the executive director seat from his current role as general counsel and CISO of $ENS Labs, and has previously been CISO of the NFL and CCO of Richemont. He is a signer on the Foundation Safe. Johnson holds a Founder seat that passes to an $ENS Labs representative if he leaves, and is recused from votes on $ENS Labs funding. The three independent directors, who serve two-year terms renewable by tokenholders, 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.
The $ENS trademarks, brand assets and other intellectual property will be consolidated in the Foundation, which will represent the protocol at ICANN, IETF and W3C and pursue recognition of the .ens top-level domain, $ENS Labs wrote in a post announcing the structure. The proposal has the Foundation license those trademarks back to $ENS Labs, which remains a separate Singapore entity and keeps core protocol development, including ENSv2. Under the same document the service provider program is absorbed into the Foundation’s grants program and the working groups wind down.
The Fight Before The Vote
The vote follows a governance fight that broke 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, prompting 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 running to July 2028.
Delegate Lefteris Karapetsas, who said the post would be his last on the forum, 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 $ENS Labs holds close to 4 million $ENS, enough to represent a majority of active voting power, while remaining the DAO’s largest funding recipient, and that “revenue has declined, expenses have increased, profitability has weakened, protocol adoption has deteriorated, and active voting power has become more concentrated.”
Johnson disputed the framing. “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 Near All-Time Low
$ENS registration and renewal fees, which the DAO keeps in full, brought in $228,329 over the past 30 days and $4.98 million over the past year, according to DefiLlama. The 30-day figure works out to an annual pace of about $2.7 million. Cumulative protocol revenue since launch is $112.3 million.
$ENS traded at $4.16 on Tuesday for a market capitalization of $174.9 million, roughly 5% above the all-time low of $3.94 set on June 26 and 95% below its November 2021 peak.
