Bypassing Premium Expiry - Discussion

You can make this argument. But I don’t believe there are any other instances where money allocated to working groups circulates directly back to the DAO?

This is the main issue here. If you take some time to look through the discussions on twitter, this is what everyone is up in arms about.

Thanks for bringing this up, I genuinely had not thought through this. It took some thought to wrap my head around what this means. This is the example I worked with to understand this idea.

I think you may have changed my mind with this :slight_smile:


Setting:

google.eth is expired, and in temporary premium at $100,000

Scenario 1:
The ENS DAO (by proxy of ENSFairy) buys this domain, there will be effectively 0 upfront cost as they’re using recycled money.

Scenario 2:
The domain was not registered by the DAO, the user chad.squatter.eth registers google.eth a few hours later for $80,000.
This $80,000 premium fee goes to the DAO.

By the DAO deciding to register google.eth in Scenario 1, they have sacrificed the revenue ($80,000) in Scenario 2.

This is effectively their cost, $80,000 to register google.eth

The DAO now has $80,000 less because they registered google.eth


This price can never be known. The true cost to the DAO for the domain cannot be known, because no one knows what chad.squatter.eth or any other user would pay until they have paid. But this is just an inconvenience, unless there are so many registrations that it starts to hurt the ENS DAO’s revenue.

3 Likes