“Super-Important”: ENS Surges After Buterin Calls For L2 Integration

• Vitalik Buterin’s ENS endorsement spikes token value by 72%, hitting a $14.7 peak.
• Buterin says ENS’s integration with Layer-2 networks is key to Ethereum scalability.
• ENS market cap surges 39.3%, signaling heightened investor interest post-Buterin boost.

The Ethereum Name Service (ENS) token witnessed a 72% increase in its value on January 3, a surge attributed to Ethereum co-founder Vitalik Buterin‘s public endorsement of the platform. Buterin, in a recent post, emphasized the critical role of ENS in the Ethereum ecosystem, advocating for its continued accessibility and affordability.

The Role of Layer-2 Networks in ENS’s Growth

Buterin highlighted the importance of integrating ENS and layer-2 networks like Optimism, Arbitrum, and Polygon. He suggested these networks should support ENS address registration to enhance usability and contribute to Ethereum’s scalability.

ENS Price Reaction 

In response to Buterin’s endorsement, the ENS token price leaped from a yearly low of $8.50 to an eight-month peak of $14.7, per CoinMarketCap. Although the price has stabilized at around $14.15, this spike marks a notable rebound from its bear market lows. ENS remains far from the all time high of $74.25 that it reached on November 28, 2021.

However, if the bullish momentum breaks through the barrier level, the next resistance level to watch for is around $18.50. On the other hand, a downturn might cause the ENS price to revisit the $12.50 support level.

ENS’s market capitalization and 24-hour trading volume increased by 39.30% and 2704.89%, respectively, over this period, to $432,486,481 and $619,278,696. This increase in market capitalization and trading volume shows increased interest and activity in ENS, which may soon lead to more price volatility.

However, the Relative Strength Indicator (RSI) rating of 82.77 on the ENSUSD 3-hour price chart indicates the token is overbought. This suggests that the ENS may see a correction or period of consolidation soon. The stochastic RSI is further evidence of overbought conditions, with a reading of 90.14.

Ethereum Name Service: Simplifying Crypto Transactions

The Ethereum Name Service streamlines cryptocurrency transactions by allowing users to replace complex wallet addresses with more user-friendly “.eth” domain names. This service enhances the ease of transferring and receiving funds on the Ethereum network, addressing a significant usability challenge in cryptocurrency.

In September 2022, Buterin proposed a “Harberger” tax of 3% on ENS domain names to discourage hoarding and promote wider adoption. This proposal aims to ensure a more decentralized ownership structure for ENS addresses, reflecting Buterin’s vision for a more inclusive and accessible Ethereum ecosystem.