ENS DAO Proposes 5 Million Token Delegation to Dilute Founder’s Voting Power

1 hour ago 2 sources neutral

Key takeaways:

  • ENS governance reforms attempt to fix centralized voting, potentially lifting token sentiment.
  • The DAO's power struggle underscores structural risks that could deter institutional ENS investment.
  • A successful delegation vote might trigger a short-term ENS rally, but execution risks remain high.

The Ethereum Name Service DAO is moving to break the concentrated voting power of co-founder Nick Johnson with a proposal to delegate 5 million ENS tokens—roughly $21 million—to a wider set of community stakeholders. The draft, posted by co-founder Alex Van de Sande (avsa.eth) on the ENS governance forum on July 6, aims to solve a pervasive one‑delegate problem that left Johnson controlling about 50% of active delegated voting power despite holding only 3% of the total 100 million token supply.

Background: On June 30, Johnson cast approximately 3.26 million ENS tokens against the on‑chain renewal of the DAO’s Security Council, the emergency multisig that can cancel malicious proposals. With the final tally near 82% against, per The Block, the Security Council’s veto authority is set to expire on July 24, 2026. The veto outcome prompted Rotki founder Lefteris Karapetsas to remark that Johnson had “delegated ~50% of the voting supply to himself, essentially becoming the DAO.”

The delegation plan: The proposal would move 5 million tokens from a treasury holding more than 50 million ENS into a delegation contract. The tokens remain owned by the DAO; only voting rights transfer. Recipients would be split into five categories, each receiving 1 million tokens: everyday users, app and exchange integrations, core developers, legacy domain and DNS providers, and DAO governance representatives. The top ten candidates in each category—selected by category‑specific metrics—receive an equal share. Delegates cannot sell the tokens, and if they fail to vote for six months, the delegation ends and the tokens are redistributed.

Wider governance tension: The proposal surfaces as ENS Labs COO Katherine Wu pushes a parallel plan to shift operational control and treasury management to the ENS Foundation, a move that former constitution author Brantly Millegan labeled “the equivalent of treasury capture by ENS Labs.” Outside the community, original DAO architect Christoph Jentzsch went further, calling for ENS to dissolve its DAO entirely and burn the key on the ENSv2 Universal Router. His call marks one of the sharpest external critiques of token‑weighted governance when a single delegate can swing outcomes.

The proposal still needs to pass through ENS governance stages—forum discussion, a formal snapshot vote, and on‑chain execution. Key unresolved points include how delegates will be selected, what metrics determine category membership, and whether the 5 million tokens will come exclusively from the DAO treasury. Until completion, its final form and impact remain pending.

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