Polkadot resets DOT supply cap at 2.1 billion

Polkadot has passed a proposal to cap the supply of DOT tokens at 2.1 billion, which suggests lower emissions and greater scarcity moving forward. The company revealed that the initiative follows the approval of the referendum 1710 with 81% in favor.

At the time of publication, only 1.6 billion DOT exist, accounting for only 76% of the eventual supply. The referendum 1710 replaced the current unlimited issuance model, which only minted 120 million DOT annually without a supply cap. 

Polkadot schedules a two-year inflation period for DOT tokens

https://twitter.com/Polkadot/status/1967241017314115889

According to the new model. DOT tokens are scheduled for a two-year token inflation period. The firm also said new DOT issuances will step down every 2 years starting from Pi Day, March 14, 2026.

The director of The Kus, the top news source for the Polkadot ecosystem, Jay Chrawnna, revealed that the date was important because it was near Bitcoin’s halving. He acknowledged that DOT will step down every two years and will be coordinated with Bitcoin’s halving every other step.

Polkadot forecasts that there will be approximately 1.91 billion DOT by 2040 under Ref 1710’s model, compared to 3.4 billion under the current 120M per year model. The firm also expects to reach the 2.1B market cap around the year 2160.

The company maintained that the model is focused on scarcity, enhancing predictability for investors, and strengthening long-term alignment across the ecosystem. Polkdadot’s OpenGrov framework enables referenda where token holders can submit proposals, cast votes, or delegate voting power. 

Under the new model, Polkadot proposes three schedules for reducing inflationary pressure, including one option to immediately cut emissions by more than half before easing off. The other options include applying sharper early reductions followed by a gradual decline through the next century.

Polkadot Poland DAO OpenGov said the company is pleased to vote in favor, while simultaneously voting against other proposals regarding changes to the DOT economy. The company said it considers introducing a fixed supply as beneficial for Polkadot’s future and for setting it back on the right track.

The firm added that it views the proposal positively because it will enforce a more prudent approach to spending DOT tokens. It also believes that the proposal makes the revenues DOT users can generate more realistic, thus making the DOT token significantly more valuable and robust in the long term.

The initiative comes as co-founder Gavin Wood returns as CEO of Parity Technologies, the blockchain network’s development arm. Wood also framed the cap as part of a broader effort to prepare Polkadot for its 2.0 upgrade later this month. The initiative aims to reduce developer expenses while pushing throughput to new heights with creatures like Agile Coretime and Elastic Scaling.

At the time of publication, DOT had dropped by nearly 5% to $4.18 following the announcement of capping the token’s supply. Despite the dip, the digital asset has surged by 4.12% in the last 7 days and increased by more than 6.65% in the past 30 days.

Polkadot seeks to connect institutional investors using blockchain infrastructure

As previously reported by Cryptopolitan, the company aims to strengthen its position against rivals like Ethereum through incentives such as Polkadot Capital Group. The firm launched the project on August 19, which is designed to connect institutional investors with Polkadot’s blockchain infrastructure. The initiative aims to help institutions explore crypto-related opportunities in areas like asset management, banking, venture capital, and exchanges.

The crypto company said it created Polkadot Capital Group in response to rising institutional demand for digital assets and improving regulatory clarity. The project’s leader, David Sedacca, said the team is already pursuing partnerships with asset managers, brokers, and allocators.

On-chain data shows that Polkadot’s trading volume over the past 24 hours is $235.3 million, representing a 51.5% decrease from the day before. Polkadot’s open interest has also dropped by 2.35% to $605 million, while its derivatives volume fell by 43% to $446.5 million.

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