ENS Financial Position

I’ve put together the following tables to give people a clear picture of ENS’s financial standing with regards to registration revenue etc. Note that I’m not an accountant, and I prepared these purely on a best-effort basis based on publicly available registration data from BigQuery and Dune Analytics. There may be errors - even large ones - so please do not rely on this except as a guide.

These are as of November 4, 2021. Unearned revenue is valued on an ETH basis - eg, if someone paid 0.1 ETH for two years’ registration, a year later we regard 0.05 ETH as unearned, regardless of the relative USD values on those two dates. The DAO may wish to account for this differently in future, or allow for converting or investing unearned revenue as something other than ETH; that is beyond the scope of this post.

Balance Sheet

USD $ Note
Current Assets
Registrar controller ETH $14,291,277.78 3149.94 ETH @ $4537
Multisig ETH $19,823,287.25 4369.25 ETH @ $4537
Multisig USDC $10,318,098.31
Liabilities
Unearned Revenue -$22,666,352.93 4995.89 ETH @ $4537
Net Assets $21,766,310.41

Profit and Loss

USD $ Note
Income
Turnover $13,115,599.32 5177.89 ETH total
gain/loss from exchange rate $10,376,487.61 Difference between USD dollar value of registrations and ETH value on 2021-11-04
revenue from previous registrations $12,465,931.38 2747.01 ETH in previous years registrations coming due
less unearned revenue -$18,127,628.87 3995.51 ETH in registrations prepaid for future years
total income $17,830,389.44
Expenses
Gitcoin grant -$700,000.00
Singapore income tax -$2,163,921.00
total expenses -$2,863,921.00
Net profit/loss $14,966,468.44

Unearned Revenue Over Time

I like to call this chart the “ENS mountain range”. Each series shows unearned revenue for registrations up to a certain date; as the date passes it reflects the earning out of the revenue pertaining to that period over time. Each month a new line is added to the right side of the chart, without affecting the shape of the existing chart. Unearned revenue is projected a year into the future, showing the guaranteed income to ENS in the year to come regardless of new registrations.

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Is this information in realtime somewhere? dune?

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Unearned revenue is from this data studio report, which updates monthly.

Revenue (valued in USD at time of registration and ETH) is from this Dune Analytics query.

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Right away we need to think about displaying this information together with the governance data, information is power and influences the responses of future proposals.

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I love that you took the time to find this.

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I think it would probably be sensible to find a crypto-friendly accountant to put together quarterly accounts for the DAO going forward.

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This is great, public companies are required by law to provide accurate and informative reporting on quarterly and annual basis, blockchain entities are not that well regulated because they are poorly understood, but there is absolutely no reason whatsoever not to self-regulate and not to provide similar level of disclosure comparable to what listed companies are doing.

I was going to suggest that DAO would do this, but you were faster! :+1:

These can be called, “transparency report”, or “annual report”, or just “activity report” to inform general public how DAO is doing. As someone who has tons of exposure to sophisticated financial institutions I can certainly help to establish best practices in reporting!

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Its not about accounting per se, but “money numbers” are obviously important, I think it would be great if DAO would build those reports on regular basis to inform general public on its progress overall, as in what initiatives were implemented, what is still in pipeline, how those initiatives affected number of registrations in the past etc. For example implementing killer feature X, could lead to explosive growth of registrations and so. Typically those reports tend focus on operational statistics and providing context about operations, and then there is deep dive to financials with comments

If implemented correctly this could set new standard in the world of blockchain for accountability and transparency.

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Singapore taxes… interesting. Would like to know what that expense will look like after the $ENS token launch…

Well after a month of price discovery for the token I would propose that we put 1/2 of the ETH we have into an ENS/ETH liquidity pool and hold it as a DAO.

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Hi arachnid! Thanks for putting this together. Can I help with financial reporting and analysis?

When the keyholders send the funds and control of the registrar to the DAO as a result of the DAO requesting them, control of the assets officially transfers to the new ENS Foundation in the Cayman Islands; there’ll be no further Singapore taxes owing. The amount in the figures above covers 2021 income up until about mid-october.

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Sure, your input would be very welcome!

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Great effort. I love that you brought this here

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Thanks for putting this information together! It’s very informative.

辛苦了 一定花了不少的时间 再次表示感谢

hi, just want to say this is great and ty! : )

I’ve put together a more comprehensive ENS dashboard, which automatically tracks onchain data to calculate a few useful things:

  • Charts and figures for revenue, income, registrations, renewals, and total active names over user-selectable periods.
  • Monthly stats (all the above) for the current and previous year.
  • A balance sheet calculated from onchain holdings, taking into account unearned income.

More suggestions for useful stats to track are welcome!

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I’ll look at this as soon as I can, and let you know any suggestions. I would consider myself a crypto friendly accountant :wink:.

Nick, this is something that’s kind of in my wheelhouse. Not an account but am a budget analyst. Was wondering how the dao currently tracks it’s wallets and funding efforts/streams etc. I’m not familiar with the locations of all the data and could gleam alot from etherscan. Believe given a little time I could come up with some good budgetary dashboards to display our PG funding, programs, results, etc. I currently manage $8b and 400 programs globally. Does the dao currently have a comptroller type team?

The dashboard I linked above automatically gathers up-to-date income and revenue for name registrations, and a current balance sheet - but other than that it’s all manual.

You’re right that we’re going to need something more robust and comprehensive. If you’re offering to help with that effort, that would be much appreciated.

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