Many people ask me about a simple way to get involved in the brave new world of Web3, Decentralized apps, and blockchains in general. I have now learnt that the Ethereum Naming Service is an “attack vector” to understand the sometimes opaque world of Web3. It certainly helped a newbie like me to get more of an understanding of the operational mechanics. I believe that Web3 will redefine the Internet as we know and I think it is essential for every business professional to have a functional understanding of this space.
Firstly, why do you need an ENS? ENS is a “smart contract” (programmable code), that translates Ethereum addresses to something searchable like renjitphilip.eth. My Ethereum address to send and receive Ether is 0x303333a653aC7F920A4eA69AB41849Ad3b8D8703! Not very memorable and prone to copy paste errors, you would agree.
The advantage of having an ENS name, is that no one can take the Ethereum name away from you as the ownership is recorded on the blockchain (immutable and censor resitant to corporates or even governments). There is no centralized naming entity (such as ICANN) that distributes the names, and no one can sell them unless you consent.
I have been learning about Web3 for the past few months, and I decided to get myself a name on the ENS. This is one way to get involved and learn several things on the way. Before we go there, let us understand what Domain names are.
Domain Names and Ethereum Naming System
We have domain names on the web that help translate difficult-to-remember IP addresses (example: 188.8.131.52). This blog is hosted at one such domain name: www.renjitphilip.com. Generally, you purchase and set up your domains on domain management services such as GoDaddy or Namecheap.com.
What happens on the Ethereum blockchain? Ethereum blockchain is designed to be a world computer. So, it makes sense that there should be an equivalent naming system for its users or computers. That is what ENS is- Ethereum Naming System.
Before we go any further, it is good to understand the following, if you do not already. If you do know these terms, simply skip ahead.
What is Ethereum? It is a blockchain (I have written about Blockchain here if you want to know more) that allows for programmable money. It also allows for apps known as DApps (decentralized applications). It will enable you to program money without having banks or payment providers. It also allows for smart contracts, games, social media, work app, marketplaces, and NFTs (I have written about this too).
What is a Wallet? You keep your physical cash and cards in a leather wallet (or pleather). Web3 has what is called non-custodial wallets. You can store digital assets without a go-between centralized entity, or custodians. Examples of custodians in our centralized world are banks or depositories.
There are hardware wallets (like Trezor and Nano) and software wallets (like MetaMask, Mathwallet, and AlphaWallet). Wallets are a gateway to websites that allow you to buy NFTs, Crypto assets and hence will become more of a login pathway and a proxy for your identity in the decentralized world. This is an important concept to grasp. MetaMask is a popular wallet that allows users to interact with decentralized applications and exchanges. In it, you can buy, swap, and deposit tokens in and out of supported exchanges.
What are Gas fees? Gas fees are the cost of powering a transaction on the Ethereum blockchain. Ethereum incentivizes miners to run the nodes and offers to compute power to the blockchain users using “gas fees.” Right now, gas fees (2022 Jan) are about 114 Gwei. Gas prices are measured in Gwei, where 1 ETH = 10^9 Gwei. You can get an idea of the Gas fees by checking out sites like ethgasstation.
With those concepts out of the way, let us get into the actual steps for procuring and setting up an ENS.
Get a MetaMask Wallet (preferably). You can download one on the Chrome browser. I could not get Metamask to work on my Brave browser or on Firefox for some reason. One point to remember about your wallet is “Do not give out your passphrase to anyone and keep these safe.” These are like your keys to your digital safe.
Get some ETH (Ether or ETH is the cryptocurrency that powers the Ethereum blockchain), needed for the purchase. You can use a centralized exchange to buy ETH(like Coinbase / BitOasis). Just make sure you transfer the eth to your MetaMask wallet. Make sure you input the address correctly and pick the ERC20 Ethereum Mainnet blockchain.
Go to app.ens.domains and connect your Metamask wallet
Search for an available ENS name. Remember to register the name for 10+ years to help you save money on gas fees. The gas Fees are high these days - The entire transaction will cost around 250$ for 20 years (this value maybe different for you).
It is a three-step process on the page, and the MetaMask wallet will open and ask you for confirmations. Read the instructions carefully and check if the pricing you agreed to pay is displayed correctly. It takes under 5 minutes to get the name registered on the blockchain.
After this, go to set “reverse records”. Which will take you to the “my accounts” page and then select your ENS name and save it on the blockchain. You can add/edit records and enter your domain name and Twitter handle and other records if you want. All these will be displayed on the blockchain for all to see, so be selective. You can even enter your bitcoin wallet address. You have the ability to enter as many records in one transaction, as you may want to reduce the gas fees and save the records on the blockchain in one shot.
ENS has, at the time of writing, ~640k names registered, 448 integrations, and around 272 owners (so people own more than one name).
Now you can use the ENS name to receive ETH or any Ethereum based assets or even BTC (if you entered the BTC wallet address). Advantages:
- You do not need to copy and paste long hexadecimal wallet addresses to receive Cryptocurrency, BTC, or NFTs.
- You can launch censorship-resistant websites with ENS. You can upload your website to IPFS and reference them using your ENS names. I will write more about this later.
And just like that, you have learnt a lot about the new decentralized web as you go about this process of applying for an ENS.