The ENS Governance Crisis: Founder Veto, Project Wind-Downs, and the Future of a $350M DAO

The Ethereum Name Service (ENS) ecosystem has been plunged into its most severe governance crisis yet. Over the past several years — and intensifying in mid-2026 — a series of interconnected events have tested the limits of decentralized governance: a director fired for offensive tweets who voted to keep his director seat, a suite of digital identity projects shuttered, a $1.2 million grant application rejected, and the founder of ENS using roughly half the protocol's voting power to single-handedly block the renewal of the Security Council. Here is a fact-checked, cited account of what happened and what it means.

Brantly Millegan: Fired, Voted to Stay, and Eventually Resigned

The saga began in February 2022, when a 2016 tweet from Brantly Millegan — then Director of Operations for True Names Limited (TNL), the non-profit behind ENS — resurfaced. In the tweet, Millegan called "homosexual acts are evil" and "contraception is a perversion." On February 6, 2022, TNL terminated his contract, stating his position was "no longer tenable" .

The ENS DAO then voted on a separate proposal, EP6.1, to remove Millegan as a Director of the ENS Foundation. The proposal failed. Millegan personally cast more than 363,000 delegated ENS tokens against his own removal, contributing to the 43.39% opposition vote; only 37.51% voted to remove him, and 19% abstained . He remained a Foundation director. He later voluntarily resigned in March 2023, effective upon the election of a replacement . The crisis already revealed a structural weakness: a DAO vote could not remove a director who controlled enough tokens to block his own ouster.

EthID Shutdown: Grails, EFP, and ENS Market Bot Wind Down

On July 4, 2026, CoinMarketCap reported that the ethid.org project is shutting down as ENS refocuses on its core protocol . EthID was a collection of auxiliary digital identity projects including the Ethereum Identity Kit, the Ethereum Follow Protocol (EFP), Grails (an open-source ENS manager and market launched November 2025), and the ENS Market Bot (@ENSMarketBot) . The Ethereum Identity Foundation — the entity behind EthID — had applied for a Streamed Payment Proposal (SPP2) in March 2025, listing brantly.eth as primary contact and ethid.org as its company website . The shutdown marks a strategic wind-down of projects that were built to extend ENS's identity layer.

The Rejected $1.2 Million Grant and the Sunset of the Public Goods Working Group

While exact on-chain vote tallies for the SPP2 application are not fully preserved in the available sources, the grant application was clearly made to the ENS DAO's Public Goods Working Group . That working group has now been sunset after 4.5 years . Its final term committed $450,000 USDC + 72.5 ETH (~$123,000) across Builder Grants, Strategic Grants, and advocacy work . No new funding round has been announced to replace it.

Complicating matters further, a Superfluid AutoWrap bug drained approximately 616,000 USDC from the DAO timelock, blocking already-approved working group funding from executing . The Collective Working Group Funding Request — approved in October 2025 — could not execute by January 2026 for this reason . This technical failure may have contributed to the grant rejection or at least rendered the DAO unable to fulfill previously approved commitments.

Nick Johnson Blocks Security Council Renewal with ~50% Voting Power

This is the core of the 2026 governance crisis. Nick Johnson, ENS founder and lead developer, used approximately half of the protocol's active voting power to block an on-chain proposal to renew the ENS DAO Security Council. The on-chain vote ended June 30, 2026, after Johnson voted against renewal . Before the on-chain vote, an off-chain Snapshot (signal vote) had already passed in favor of renewal — but Johnson's participation in the on-chain stage defeated it .

Ethereum community veteran Lefteris Karapetsas called the DAO "dead" following the vote, arguing that Johnson's voting power protects a treasury worth roughly $500 million from outside oversight . The financial stakes are enormous: the ENS DAO treasury is valued at around $350 million in total assets, but excluding native ENS tokens, the non-ENS liquid reserves drop to roughly $88 million . The ENS token itself has lost over 95% of its value from its 2021 peak of ~$85, trading at around $4.07 . Total DAO spending to date is approximately $51.5 million .

Proposals to Dissolve the DAO and Growing Centralization Concerns

The governance crisis has triggered serious discussion about dissolving the DAO entirely. Several interlocking concerns have driven this talk:

• Power centralization: Johnson's ability to single-handedly block Security Council renewal using roughly 45–50% of active voting power has exposed the DAO's vulnerability to a single concentrated voter .
• Treasury control fears: Critics argue Johnson's voting power insulates the massive treasury from any oversight or reform . The disparity between the $350M headline figure and the $88M in actual liquid assets creates a vulnerability to "residual floating value takeover attacks," where an actor could acquire tokens on the open market to extract treasury funds .
• Working group shutdowns: Beyond the Public Goods Working Group sunset, a DAO proposal to replace all three working groups with an Admin Panel was voted down in December 2025 . The existing structure remains, but its financial execution capacity has been crippled.
• Loss of community confidence: Ethereum community veterans have described the DAO as effectively "dead" under the current governance structure .

In short, the entire ENS ecosystem — from Brantly Millegan's departure and the EthID project wind-down, to the Security Council veto and talk of dissolution — reflects a governance system under severe strain. Power is concentrated in the founder's hands, the treasury is heavily dependent on a deeply discounted native token, and the community's faith in the DAO's ability to govern itself has eroded.