A recent vote was made by the Ethereum Name Service (ENS DAO), a decentralized domain name system, to liquidate 10,000 ETH for USDC in order to pay running costs for the following two years. The decision to sell $16M ETH was made in order to lessen the project’s exposure to ETH in the event of a market move to the downside. The market capitalization of the ENS token is $316 million.
What happened in the voting?
89 percent of participants approved the governance idea after significant deliberation and discussion, which took place after the proposal was first put forth on January 18. The substantial support of the community for the decision to liquidate ETH is evident from the high approval rate.
Liquidation of ETH
The decentralized exchange aggregator CoW Swap will liquidate the $16M in ETH, and the DAO anticipates receiving at least $13 million in USDC stablecoin in exchange. The USDC will subsequently be used to pay running costs for the following two years, ensuring the Ethereum Name Service’s continuing expansion and development. Currently, the DAO’s treasury has $2.46 million in USDC and 40,746 ETH ($67 million) in it.
The question of selling transaction?
Following a lengthy debate on the ENS governance forum, it was determined that a single transaction, rather than several tranches, would be used to sell ETH. The choice was taken to streamline the procedure and increase its effectiveness.
Multiple transactions would have necessitated several governance votes at each stage, which would have taken a lot of time and proven challenging. The ENS DAO’s commitment to reducing procedures and maintaining efficiency is demonstrated by the choice to proceed with a single sale.
Financial Status of ENS DAO
Currently, there are $2.46 million in USDC and 40,746 ETH ($67 million) in the ENS DAO’s treasury. The choice to exchange 10,000 ETH for USDC will guarantee the project’s long-term financial stability and the growth and development of the Ethereum Name Service.
What are the benefits of the liquidations?
The choice to exchange 10,000 ETH for USDC is a step in the right direction towards securing the Ethereum Name Service’s financial stability, lowering the exposure risk to ETH, and increasing its effectiveness. With the Ethereum Name Service continuing to expand and evolve, the ENS DAO can now concentrate on its fundamental goals.
The choice to exchange ETH for USDC also lessens the project’s exposure to ETH in the event of a downward market movement. Additionally, the procedure is streamlined and made more effective by choosing a single sale over several tranches.
Impact on the market
According to statistics from CoinDesk, the price of the ENS token has increased by around 4% over the last 24 hours and is currently trading at $15.69. The Ethereum Name Service’s ongoing expansion and development and the community’s support for its goals and objectives are reflected in the upward pricing trend.
The recent vote in support of selling 10,000 ETH for USDC is a step in the right direction towards assuring the Ethereum Name Service’s (ENS DAO) continued expansion and advancement. The choice to go with a single sale rather than several tranches will simplify and speed up the procedure.
Additional evidence of the Ethereum Name Service’s ongoing success includes the significant community support for the idea and the upward trend in the price of the ENS token. We’ll keep a careful eye on what happens at ENS DAO and let you know about any new developments.