- Polkadot’s decentralised autonomous organisation (DAO) has approved a referendum to set a permanent supply cap of 2.1 billion DOT, marking a significant shift from its previous inflationary model with no maximum limit.
- The decision to cap the supply, which received overwhelming community support, is intended to appeal to long-term holders and institutional investors by curbing future token issuance and preventing the supply from exceeding 3.4 billion DOT by 2040.
Polkadot’s decentralised autonomous organisation (DAO) has approved a referendum that sets a permanent supply cap of 2.1 billion DOT, marking the first time the network has imposed a hard limit on its token issuance.
Until now, Polkadot operated under an inflationary model that minted roughly 120 million DOT every year with no maximum supply. The community’s main concern is that the old system could create over 3.4 billion tokens by 2040. The new framework phases in issuance cuts every two years, starting on March 14, Pi Day. Current supply is about 1.5 billion DOT.
The vote is quite the change in Polkadot’s tokenomics because it moves from the typical indefinite inflation toward a capped model designed to appeal to long-term holders and institutions.
A chart released with the referendum showed how the capped system sharply reduces future supply compared with the old schedule.
Related: BlackRock Eyes Tokenised ETFs After Bitcoin Fund Success
Data from CoinGecko shows the DOT token hasn’t had a good 2025 so far, decreasing over 60% from a high of US$10 (AU$14.9) in December 2024 to US$4.1 (AU$6.15) at press time. It remains down 92% from its 2020 peak.
Polkadot Builds Links with Wall Street
Besides trying to push the price, the decision also comes as Polkadot increases its push toward institutional adoption.
On Aug. 19, the network announced the launch of the Polkadot Capital Group, a unit tasked with building links between Wall Street and Polkadot’s blockchain infrastructure. The initiative aims to open access for traditional financial firms to participate in areas such as asset management, banking, venture capital, exchanges, and over-the-counter trading.
Alongside its new capped issuance, the project is trying to wrap itself around use cases like real-world asset tokenisation, which a lot of institutions are keen on exploring.
Related: UBS, Chainlink, and DigiFT Launch Hong Kong Pilot for Tokenised Funds
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