ENS Secures eth.link Domain After Paying $300K to Manifold Finance

Ethereum Name Service (ENS), a blockchain-based domain name system, has finally resolved a long-standing dispute over the ownership of the eth.link domain. ENS agreed to pay $300,000 to Manifold Finance, a decentralized finance (DeFi) platform that had acquired the domain in an auction. ENS also regained the full rights to use the domain name for its services.

How ENS Lost and Regained the eth.link Domain

ENS is a decentralized protocol that allows users to register and manage domain names with the .eth extension on the Ethereum blockchain. These domain names can be used to access decentralized applications (dApps), websites, and wallets on the web3 ecosystem. However, since .eth domains are not compatible with the traditional domain name system (DNS), ENS uses the eth.link domain to bridge the gap and enable .eth domains to function properly on web browsers.

The eth.link domain was originally owned by Virgil Griffith, an early contributor to ENS and a former Ethereum Foundation researcher. Griffith was arrested in November 2019 for allegedly violating US sanctions by assisting North Korea in developing its cryptocurrency capabilities. He was sentenced to five years in prison in June 2022. Due to his incarceration, Griffith failed to renew the eth.link domain, which expired in July 2022.

GoDaddy, the registrar of the eth.link domain, allowed it to expire and did not inform ENS about it. Manifold Finance, a DeFi platform that provides liquidity and arbitrage services, seized the opportunity and bought the domain in an auction on Dynadot, another domain registrar, in September 2022. Manifold claimed that it wanted to use the domain for its own purposes and did not intend to harm ENS or its users.

However, ENS was not willing to give up the domain, which it considered vital for its operations and user experience. ENS filed a lawsuit against Manifold, GoDaddy, and Dynadot in an Arizona District Court, accusing them of cybersquatting, trademark infringement, and breach of contract. ENS obtained a court order to prevent the transfer of the domain away from its ownership and sought damages and injunctive relief.

The Settlement Terms and Implications

After months of legal battles, ENS and Manifold reached a settlement agreement, which was approved by the ENS decentralized autonomous organization (DAO) on February 26, 2024. The ENS DAO is a community-governed entity that oversees the development and governance of the ENS protocol. The settlement terms required ENS to pay $300,000 to Manifold, along with confidentiality and non-disparagement clauses. In return, Manifold agreed to drop the lawsuit and transfer the domain back to ENS.

The settlement also included a reimbursement of $750,000 for ENS’s legal costs, which was also approved by the ENS DAO. ENS founder Nick Johnson said that the settlement was the best option for ENS, as it avoided further litigation risks and costs, and secured the domain name for the future. He also thanked the ENS community for their support and participation in the DAO vote.

The settlement marks the end of a long and costly dispute that threatened the stability and usability of the ENS protocol. ENS users can now access their .eth domains without any interruption or interference from third parties. ENS also announced a partnership with GoDaddy, which will allow .eth domain holders to link their domains with traditional domains for free. ENS hopes that this will increase the adoption and awareness of its service and the web3 ecosystem.