ENS Labs said it has abandoned its Namechain Layer-2 plan and will deploy ENSv2 exclusively on Ethereum Layer-1, citing a sustained collapse in L1 gas costs and faster-than-expected base layer scalability.
ENS Labs presented its decision as a realignment of both economic and security considerations, after concluding that developing and maintaining its own rollup was no longer necessary. Over the past year, gas costs on Ethereum L1 for ENS operations have decreased by nearly 99%, with name registration fees falling from around $5 to less than $0.05. According to the team, these savings eliminated the primary incentive to operate a dedicated Layer 2 solution.
This shift is supported by recent improvements to the Ethereum protocol. ENS highlighted the Fusaka updates implemented in 2025, which doubled the gas limit per block from 30 to 60 million, along with the developers’ plans to further expand it. Looking ahead to 2026, the teams are targeting a limit of 200 million, with expectations of additional performance gains as zero-knowledge proof-based tools are integrated.
A security enhancement and a path forward: implementing Ethereum L1
Beyond the costs, ENS emphasized the security implications. Migrating ENSv2 directly to L1 allows them to maintain “the strongest possible infrastructure guarantees.” In contrast, a custom L2 would introduce new trust assumptions, such as updatable rollup contracts, centralized sequencers, or gateway dependencies—risks avoided by remaining on the Ethereum mainnet.
The company estimated that subsidizing all L1 transactions at current levels would entail an annual expense of approximately $10,000, which could escalate to around $250,000 under post-Fusaka maximum fee scenarios. Even in that case, the amount would still be marginal compared to the operational and engineering costs associated with maintaining their own rollup.
Regarding the product, ENS confirmed that the ENSv2 roadmap remains unchanged and will be deployed entirely on L1. Among the planned improvements are a redesigned registry architecture, an updated ownership model, better expiration management, and simpler registration flows, along with more efficient name-based registrations.
User experience is another key focus of this strategic shift. ENS plans to move toward one-step registrations and enable native cross-chain payments, abstracting the complexity of gas and network bridging for the end user. At the same time, the project will maintain interoperability with existing L2 servers, rather than operating its own scaling layer.
However, some critics warn that this strategy relies on L1 gas costs remaining consistently low. The historical volatility of Ethereum fees remains a latent risk and, in a prolonged congestion scenario, could once again put pressure on the economics of registrations and renewals.
