Breaking! ENS founder used 3 million votes to veto a proposal 3 hours ago; is this the real crisis?

Let's talk about something real today: $ENS.

Some say this is the first head-on clash between decentralized ideals and real-world operations.

On June 29th, a proposal in the $ENS community entered on-chain voting—renewing the DAO security council's veto power for another two years. It was supposed to be a routine process, with 800k votes in favor vs. less than 300k against—a sizable gap.

Then founder Nick Johnson stepped in personally. He used his nearly 3 million $ENS tokens to push the opposition vote to 3.55 million. This wasn't a democratic vote; it was a "major shareholder vetoing democracy."

This security council was established in July 2024, amid low DAO participation at the time, fearing that a whale could push a malicious proposal to drain the treasury—which held over $350 million. So they set up a 4/8 multi-sig: 4 out of 8 members could veto malicious proposals.

The council's authority is very limited: can only veto, cannot initiate, cannot interfere with normal processes, and the term expires after 2 years requiring re-authorization.

So the question is: why would the founder personally vote against renewing a council designed to protect the treasury?

You have to rewind to last November. Nick posted on the forum saying, in essence: the DAO is now full of political infighting; capable people are leaving, while leadership falls into the hands of those with mismatched experience and interests.

He's not alone in this complaint. The DAO's secretary, Limes, submitted a proposal that month, suggesting directly shutting down three working groups—Meta-Governance, Ecosystem, and Public Goods—by December 31, 2025. Her reasoning: proposals had turned into a "you support me, I support you" trading market, with nobody caring about what should be done.

The deeper pain point is the lack of admission standards, leading to bad money driving out good. She felt that patching things up wouldn't solve the problem; only a "shut down" was the way out.

The proposal didn't pass, but the signal that Nick wanted change was already clear.

On June 19th, $ENS COO Katherine Wu formally proposed "The Next Era of ENS DAO: Empowering the ENS Foundation." Two core things: first, hand over daily operations, treasury management, and long-term capital strategy to a restructured foundation. The foundation would handle treasury operations, grants, working group coordination, ecosystem strategy, trademarks, and branding. The foundation would have a 5-person board, emphasizing execution.

Second, the DAO and token holders retain core powers: protocol-level governance, registry control, fee structure, and constitutional amendments remain in their hands.

The flashpoint is the treasury. Critics say this effectively gives the foundation—and behind it, ENS Labs—actual control over huge funds, diluting token holders' direct influence.

Brantly Millegan, the original author of the $ENS constitution, came out strongly against it. He argued this violates the original intent of token holders controlling both the protocol and the treasury—essentially, ENS Labs wants to directly take the treasury.

This is the conflict between decentralized purists and those managing real operations.

On one side, they say inefficiency is not a reason for the foundation to "seize power." On the other, after years of struggle, they believe centralization might be more conducive to development at this point.

Nick's 3 million+ vote against is seen as firing the first shot in a power war.

He himself explained: not objecting to the security council, but worried that the current council lacks checks and balances, and a 2-year renewal would solidify the problem. More critically, he fears some members might use their veto for political purposes, stopping proposals they personally dislike rather than emergencies.

Katherine then proposed a new plan: raise the veto threshold from 4/8 to 5/8, add stricter power limits, and include a mechanism to remove members.

Data doesn't lie. $ENS In 2023, annual revenue exceeded $10 million. In 2024, it dropped to $7 million. In 2025, it has fallen to less than $2 million.

When money was abundant, nobody cared how it was spent. Now that the industry is down and revenue is shrinking, even hundreds of millions in assets must be accounted for.

Nick holds enough votes to push these changes. But pushing through by a major shareholder with token weight has no turning back. The new foundation must perform better than the DAO, even if only slightly.

The problem is more practical than the outcome: how to do it.

The core $ENS team must now deliver a solution. Not a fantasy, but specifics on how to manage money, make decisions, and prevent internal infighting from recurring.

The window of time they have is narrower than many think.

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