Is the Bored Ape Yacht Club twist to the Ethereum Name Service tale one of a kind?

Lavina Daryanani
Source: Markets Insider

Ethereum Name Service [ENS]—an open-source decentralized Internet naming protocol based on the Ethereum blockchain—became the talk of the crypto town when its tokens were airdropped in November last year. As such, the project was proposed back in 2017 and came into existence in 2017, but never really managed to gain mass traction at that time.

Domain names with the .eth suffix, are users’ cross-platform web3 usernames. They pretty much play the role of a bridge between crypto-wallets and the rest of the Internet.

The .eth trend has been quite inconsistent. As can be seen below, the number of monthly registrations witnessed a notable spike from the 23k-30k bracket to 80k-100k in the November-December period last year. In the subsequent months, however, the hype tire was punctured and the numbers started deflating.

Curiously, in April, the number shot up. With two more days left for the month to end, the number of .eth registrations is already at an all-time high. At press time, they explicitly stood at 132.9k.

Source: Dune Analytics

The BAYC twist

Let’s rewind a little bit before analyzing what caused the latest jump.

Ever heard of cybersquatting? Back when the Internet was in its early days, common people, especially the tech-savvy ones, used to block/buy well-known company/brand names as domain names. They, for a reason knew, that the dot com bubble was contagious and there’d come a point in time where everybody would jump onto the bandwagon.

Their ultimate motive to do so was to re-sell them to the OG brands/companies at a high-profit margin at a later stage when things became mainstream. While a few succeeded, the rest failed and left the arena.

Notably, a similar trend was observed for ENS domain registrations last year. People started cherry-picking prominent names and were ready to shell out large amounts of ETH to acquire the same.

Fast forwarding the fizzled out phase, and reaching directly to 27 April, the transaction volume of ENS domain names reached 788.55 ETH, creating the largest single-day txn record.

Interestingly, as can be seen below, the main transactions were 4-digit domain names. “8541.eth” was sold to was sold for 0.3 Ethereum to a user, while “0460.eth” was sold for 0.345 Ethereum.

Source: Twitter

Right off the bat, Bored Ape Yacht Club [BAYC] is a collection of 10,000 Bored Ape NFTs. Each NFT is identified by a # followed by a string of numbers. So, at this point, the rise in the number of numerical names hints toward the fact that BAYC NFT HODLers are buying domain .eth domain names to match their NFT numbers.

Confirming the said trend, Chinese journalist Colin Wu tweeted,

“BAYC holders want to have ENS domain names that match their numbers.”

Perhaps, at a later stage when these HODLers sell their NFTs to realize gains, they might as well end up selling their domain names at a profit. Well, that will only happen only if the whole .eth frenzy remains apropos.