Tuesday 25 August 2020 9:00 am

The Dark Side of the Ethereum Name Service (ENS)

Once again it feels like the technologists are dragging us down a rabbit hole of complexity and claiming that blockchain and crypto will be our saviours. The next ‘magic bunny’ out of the crypto hat? Ethereum Name Service or ENS for short

So what the heck is ENS?

Ethereum Name Service (ENS) is a service that makes it easy to send and receive cryptocurrency and access special websites by simple names rather than by long, complex strings of letters and numbers. For example, instead of me telling you to send crypto to my ETH address: 

0xbadcafea3C2a0aFd7185514Cd8F523eE0E00049F

I could instead ask you to send it to: troyn.crypto

And instead of telling you to visit my IPFS based website at: https://ipfs.io/ipfs/QmPChd2hVbrJ6bfo3WBcTW4iZnpHm8TEzWkLHmLpXhF68A

I could direct you to: https://ipfs.ip/ipfs/blockchainrookies.ens

In both cases, ENS enables me to replace a long, complicated string with something far more readable and easier to use. A little bit like a link shortener like Bit.ly, but at the same time nothing like it.

These systems work through the magic of smart contracts on the ethereum blockchain. The smart contracts execute the registration of domains and the occasional updates to content associated with these domains. Queries to the blockchain don’t cost anything – however, that doesn’t make them quick, which is a major problem when today’s Internet is all about throughput and speed.

Another tricky aspect of these solutions is how to connect them to the rest of the Internet. These services are known as “resolvers”. It is not clear how centralised these resolvers are, nor who bears the cost of operating them. A resolver may be a smart contract, but who is paying the ETH gas fee for every call to the resolver?

This use case presumes that not only would you like to send or receive cryptocurrency, but also that you have a website stored in a decentralised filesystem like IPFS. And that, unfortunately, reduces the potential number of users to a very tiny user set.

If the primary function of ENS is to map simple words to complex strings of letters and numbers, what’s the “dark side” to this then? 

A major selling point for ENS services is that they are immutable. Once written onto the Ethereum blockchain they can’t be edited, changed or removed. This quality of immutability means that they become censorship-resistant. When linked with data stored on a decentralised file system like IPFS, then the content itself is censorship-resistant. 

In a world where dictatorships are on the rise, censorship-resistance initially sounds appealing.

There are downsides to this immutability, and very dark ones at that.

People traffickers, terrorist organisations, illegal online casinos and more can equally benefit from these services. Once their websites are up and running, they cannot be removed. When their ENS records are written into the blockchain, they can’t be removed. Suddenly this idea of censorship resistance isn’t so great any more. You’ve gone from anti censorship to enabling criminal activity.

Another downside is that if you lose the keys to your domain – you’re screwed. Just like with your crypto wallet, you are 100% responsible for maintaining and protecting your private key. If you lose it, then you lose control over that domain. Private key management is one of the biggest obstacles currently to crypto adoption. The average consumer doesn’t want the responsibility. They want to be able to phone someone up and reset their password. That’s just not possible for ENS and that’s by design.

Using ENS for addresses makes them “less” anonymous, and a whole lot of people only use (or want to use) crypto because it is anonymous. It isn’t the same as with Domain Name Services where there is a public registry, and where registrars keep all of your personal or corporate details, but these ENS addresses are not anonymous either. The data is there linking an address to a person or company. Governments and corporations can query this data.

These ENS registrars are also the intermediaries who are making fees from every transaction. Unlike DNS registrars, they don’t have to hold any data. They only have to provide access to the smart contracts so we can register and update the entries. Some registrars charge a one-time fee. Others operate on a yearly renewal fee. Who knows what happens if they go out of business. 

What is still unclear to me and many others is: What happens if someone doesn’t renew? Is there an “erase” function built into the smart contract?

As I stated in the beginning, the Internet today is all about speed. Queries to the blockchain are slow even at the best of times. Queries to IPFS are not known for millisecond response times either. Gateway services are popping up to handle the speed problems. In other words, we are adding intermediaries who can be controlled – just to solve performance issues. 

I could (maybe) see a case for using ENS to simplify crypto sending and receiving. … but it won’t make any significant impact.

I wouldn’t worry, almost no one is using these ENS tokens, and it is going to take a lot of time before they are. There are a few  browser extensions available for Chrome. Opera has limited functionality built-in. There are a few dozen crypto wallets that accept ENS addresses and more are coming – but we are nowhere near the tipping point yet.

I could (maybe) see a case for using ENS to simplify crypto sending and receiving. And it may help to drive crypto adoption, but that by itself, won’t make any significant difference. We’ve got to solve the issue of private key management and the even bigger problem: No consumer can see any reason to own crypto outside of speculation. For all the people promising to free people of ‘traditional fiat’, ever tried asking your landlord or utilities company to accept payment in an altcoin? I think not. 

Using ENS for immutable, simplified access to decentralised data sounds good when you position it against censorship. When you add in terrorism, people trafficking and other illegal activity, the attraction quickly disappears, and rightly so. As soon as ENS attracts the same stigma as the so-called ‘dark web’, its uses will be curtailed and there may even be regulation that comes into force to mitigate the obvious implicit risks in this technology. 

If we had no bad actors (neither dictators nor terrorists), there would be no need for censorship resistance. There would be no need for centralised control. That is not the world we live in today. Instead, it’s a world where the bad actors are more likely to use ENS for darker purposes than the good actors would for good causes.

Get in touch with us info@blockchainrookies.com / Twitter @igetblockchain

Troy Norcross, Co-Founder Blockchain Rookies

Twitter: @troy_norcross

Share: