Proposal for ENS DAO to Launch an Official Marketplace Dedicated for Trading ENS Domains

This proposal is for ENS DAO to develop an official market place dedicated for trading ENS domains, main justifications as below:

  1. Protect existing or potential new ENS users from being scammed. That scam is inclusive of
  1. Fake collection. In opensea or Looksrare(where most of ENS domains are being traded), anyone can create any collection and it could just look exactly like the real ENS domains.
  2. Non-ASCII, or “looks similar” such as 1 with l, 0 with O.(opensea/looksrare doesn’t have filter function)
  3. Scamed by platform. Some new NFT trading platform might have security issue, ie. contract not audited, any vulnerable issue can cause user’s account got compromised.
  4. It would be most legit to trade domains on an official ENS marketplace, because most of above can be avoided, therefore users are protected.
  1. Improve user experience in registrating and trading domain.
  1. When users search a name on app.ens.domains, currently they can only see if it is available or not, but in an integrated official marketplace they will directly see the listing information along with a buy link, this is a huge advantage for ENS official to do this, because this way everything can be under one platform.
  2. Opensea and Looksrare are very hot NFT marketplace, but they are doing a terrible job for UX of crypto domain. It has been 2.5 years since ENS short domain auction held on Opensea, and yet they don’t have a least basic filter function for domain. They are still not ready to trade crypto domain after so many years, or in other word, they don’t deserve at all. It will be a very limited effort job for ENS official marketplace to add a popular filter function just general TLD does.
  3. Transaction fee will be ENS DAO’s income as part of ROI, it is recommoned to set transaction fee lower than Opensea(2.5%) and Looksrare(2%) at some reasonable and attractive such as 1%, and “Reserve for specific buyer” listing is expected to be free of charge. This will not only effectively encourage users to trade ENS on official marketplace which protects them, but also add an additional recurrent income to ENS DAO.

The development solution can be either in-house developed by exisintg ENS team, also can be out-sourced to professional team outside that funded by ENS DAO. This can be determined afterwards.

This proposal reflect the common interest of majority of ENS users. Please leave your comment and let’s see how soon we can put this to a DAO vote.

20 Likes

It is highly unlikely that the DAO will undertake any proposition of a centralised DAO-run exchange for ENS names since running an exchange requires licensing in each country and ENS DAO doesn’t have the legal capacity for it at the moment. However, the community is free to build a decentralised marketplace and I can imagine the DAO funding it in some form, but it sure won’t be running it in any capacity. The same DMCA notices that led to several names taken down from OpenSea “apply” to all centralised marketplaces irrespective of where they are legally founded; ENS DAO is legally residing in Caymans and Caymans is not unreachable. For instance, if ENS is served with a DMCA to take down a name on its imaginary marketplace, it will very likely do it because not doing it just makes it worse to continue operating. The best way forward is not an ENS-run marketplace, unfortunately. I am obviously severely understating the issues in running a centralised exchange; DMCA is only one of many issues standing in the way, e.g. GDPR in EU.

14 Likes

A decentralized marketplace makes sense because it will avoid clear legal matters among countries, even can consider to make it an open-sourced one.

5 Likes

Open source always. Same as https://app.ens.domains. It is just a frontend to a smart contract. If ENS DAO is forced to take it down some day in dystopia, anyone can fork and run their own local node.

4 Likes

In the same line of thinking,
we could have:
Updated ENS-NFT Meta-Data.

IE:

  • All Letters
  • All Numbers
  • All Emojii
  • Noun, Adjective
10 Likes

I’ll recommend you to re-draft this proposal, mark it under ‘Temp Check’, and ask the DAO to float an RFP (Request For Proposal) for a decentralised ENS marketplace. Ask the right questions :wink:
For reference, if you give me and my team two weeks and sufficient compensation, you can have a marketplace. I built one on Solana (https://sshmatrix.eth.limo) end of last year alone and I am the worst coder in my team. My point being: there is human capital to build it. Community needs to give the DAO a kick to get it moving by putting out RFPs. Hell, we can even fork couple of ideas from ETHAmsterdam Hackathon itself that @alisha.eth cannot stop talking about :slightly_smiling_face: I bet we can find a way to integrate Nifty chat by @slobo.eth into it too

8 Likes

notes from twitter-space about this topic:

  • Builders needed to make a decentralized marketplace ( telegram group has been setup - request access from validator.eth / alisha.eth)

  • Decentralized order book - ie:zorra

  • Cross listing to other marketplaces

  • Graphic designers needed for better UI/UX

  • Better ENS like searching tools - ie: ens tools

  • Security team - Audits/ Code bounties

  • Word press plugin

  • Fewer marketplace fees for ENS community

  • ENS grants could help with funding

  • Make an API like openseaAPI

  • Soft PR to take weight off ENS

6 Likes

There is a conflict of interest, I recommend Chinese walls segmentation between the key holders and end users. ICANN unlike the gambling industry, employees of domain registrars can have their own portfolio, where as in the gambling industry playing is forbidden.

2 Likes

You could propose an RFP for this as inplco suggested.

Personally, I don’t think the DAO needs to be responsible for this; there are other marketplaces already existing and currently being built, they operate fine on their own, and I don’t really think it’s the DAO’s job to encourage speculation on secondary sales by facilitating them.

8 Likes

I agree with Nick on this. It doesn’t seem aligned to the DAO’s current mission. The DAO has been focused on building out the protocol and the platform, enhancing the utility of the names, helping to bootstrap new parts of our ecosystem, funding public goods, etc.
Starting a business that competes with Coinbase and OpenSea and LooksRare would be a very, very large project.

If this is the stated goal, it’s a tall order.
We could certainly provide a resource that coaches on best practices to avoid getting “scammed” on a 3rd party site if such a resource would be valuable for the community, but undertaking the active policing of the listings to ensure no one gets scammed on our marketplace would be pretty resource intensive.
The concept of “scammed” could also be a bit subjective and tough to enshrine into DAO rules and responsibilities.

One of the most compelling things shared on the Twitter Space earlier (about an hour in) was when AOX.eth was discussing the design of a decentralized exchange with an open order book that could be leveraged by multiple different front ends. That’ll be an awesome project, but it still won’t solve the two stated goals above.

All that being said, the beautiful part of DAOs is that all ideas are welcome for debate. The best path forward is exactly what others have said - draft a detailed and persuading proposal that addresses any objections and put it forth to the community.

7 Likes

First 3-5 years of a domain project is mostly registration, afterwards majority choice for new comer will be secondary sales because all good ones are not longer available to register.

There are obvious pain points for all 3rd party marketplace that trading ENS domains(scam, bad UX, potential risk of wallet got compromised). As long as the marketplace is from a 3rd party, there is always such a “Trust” concern that can never be thoroughly eliminated. Even Opensea can be compromised during short domain auction by late 2019. Only a marketplace from ENS official can resolve the problem from the root, it’s about the top level design instead of anything about technical.

Registering a domain on ENS APP or buying one from secondary market, these are equally ENS followers and should not be treated or categorized differently. Having a very successful and well-fixed ENS DAO in place, these suffering voice from secondary market ENS followers shall be heard and treated seriously.

ENS as a critical infrastructure of web3, itself has been an eco-system, registration should definitely not be the only thing ENS team focus, secondary marketplace for ENS is equally important to the common good of ENS community.

2 Likes

Building a centralised system in order to elevate trust issues, is precisely the problem that decentralisation intends to solve. Think about it; best way forward, if at all, is a self-propagating decentralised open-source marketplace built by the community for the community with little to no involvement from ENS DAO apart from funding the initialisation in some capacity. Irrespective of the pain of secondary market users, there isn’t much ENS can do here.

5 Likes

Hi Mate,
I have a different view on this.
The “official” marketplace can easily bring in these benefits:

  1. Lower or no Fees for ENS traders.
  2. Same trust anchor. Don’t need to trust an extra party to use or trade ENS.
  3. Much better UX.
  4. Specific trading logic which may only make sense for ENS trading.
  5. one more revenue source for ENS DAO.
  6. Secondary sales is one of the best ways to increase ENS adoption. It is already proven in the domain market.

At the same time, I don’t see there is any downside to building this.

What do you think?

3 Likes

All of these things reduce the friction for trading ENS names on the secondary market - which is great for people who want or need to do that. But, decreasing friction increases profitability, and I sincerely don’t want to make squatting more attractive and profitable. I’m aware not all secondary sales are squatting, but it’s a significant component.

4 Likes

Very much the same view can be applied to ETH as well. I want the people who really use ETH to hold and buy ETH, I don’t want to make squatting more attractive and profitable. :grinning:
I guess if Ethereum grow like that, it would die a long time ago :sweat_smile:

As we own the AlphaWallt project, we have been approached by multiple ENS-like projects all the time. I can see how aggressive they are. ENS has the best tech, the best vision, and is in the best position (at least for now), plus holding a good amount of “don’t know where to spend” money. I think it makes sense to support this idea.

Again, it seems there is nothing to lose.

I do not think ENS doesn’t launch any official market place will discourage squatting on any level, others are doing so on ENS’ behalf, and ENS users will have a painful experience on all those 3rd party platforms, that is today’s headaque.

As long as ENS keeps doing great, there will just be more squatters anyway, this has nothing to do with the marketplace, and whether whose marketplaces are hosted by ENS or someone else.

In traditional web2 world, there are trademark law and UDRP to punish squatting behavior. ENS is an NFT in our Ethereum account that nobody can take it away from us, and this attribute determined squatting is a technically valid move here. We like it or we don’t like it, we can only live with it. And ENS team has yet collected decent funds for daily registration/expiration premium/2019 short domain auction, a certain amount of these are for trademark domain squatting. ENS accepted these money for squatting domains, and I don’t think it the right thing to do today, if ENS is trying to neglect majority user’s bad/dangerous experience on secondary marketplace, only to discourage minority of squatting behavior.

2 Likes

I don’t know why you keep saying that there is nothing to lose. It has been laid out in detail why and how ENS cannot start a centralised marketplace even if it wanted to for so many legal reasons. It seems like you folks are keen on getting ENS core team sued :grimacing::thinking:

1 Like

ENS allows registration of any trademark domains as always, why is trading domain so differently?

Even if there is such legal concerns, ENS team should focus on finding workarounds to make ENS truly a decentralized name service, otherwise there is no difference made at all comparing to those TLDs under ICANN bureau.

Did I miss anything, why does a marketplace have to be centralised?

When we did the FIFA WC 2018 NFT ticket 4 years ago, we already have build-in trading logic in the NFT token contract which enables any user agent or 3rd party to use the functions to trade, where users don’t need to worry about whether the 3rd parties trading logic is safe or not.

What I see is adding some ENS-related trading logic in the contracts, why this will get ENS core team sued? Can you explain a bit more?

1 Like

@Victor928 @master

Decentralisation is not a tool designed to escape legality. ENS must and should abide by the laws or it will be razed by regulators. ENS has so far remained clean and blemish-free because it hasn’t entertained greed as much as other cash-grab projects.

ENS is not “allowing” anything per say, https://app.ens.domains is an open-source code and it is no more than a frontend to the registrar smart-contract. ENS registrar is also an open-source and ‘distributed hosted’ code; anyone can interact with it with or without any assistance from ENS DAO. In the future, it is possible that ENS will get sued for some trademark infringement or assistance in trademark infringement; bigger the organisation, bigger the target. It is highly likely and along the very lines you mentioned; it is in ENS’s best interests to remain clean when that point comes. Plus, trading is a different beast; registration is an interaction of a human with a machine without agents, trading is a mediated interaction (by an agent or exchange) between a human and a human. Those two stand on very different legal ground; doing the former is more or less essentially freedom while doing the latter requires trade licenses in each country where the marketplace makes sales. Registration and trading are apples and oranges.

Ok, I presumed you meant centralised marketplace. If you are vouching for decentralised marketplace, I am all for it. Please propose an RFP.

6 Likes