Polkadot’s decentralized autonomous group (DAO) has handed a referendum approving a tough cap on the community’s native token for the primary time.
The choice units the utmost provide at 2.1 billion Polkadot (DOT) tokens, a major pivot from the earlier tokenomics mannequin, the place new tokens have been indefinitely issued yearly. Under the previous inflationary mannequin, Polkadot minted about 120 million DOT tokens yearly, with no restrict on the token’s complete provide.
The venture mentioned that the provision may swell to greater than 3.4 billion tokens by 2040 beneath the previous mannequin. However, the brand new framework introduces a gradual issuance discount each two years. At the time of writing, Polkadot had a complete provide of about 1.5 billion tokens.
According to Polkadot, the issuance discount will occur each two years on Pi Day, which is March 14. The venture additionally shared a chart, demonstrating the distinction in provide beneath its new mannequin.
Cointelegraph reached out to the Web3 Foundation, the workforce behind Polkadot, for extra info, however didn’t obtain a response by publication.
Polkadot launches capital markets division
The change comes as Polkadot strikes to increase its attain with institutional traders. On Aug. 19, the venture launched the Polkadot Capital Group, a brand new division designed to attach Wall Street companies with its blockchain infrastructure.
The division goals to attach conventional finance gamers with Polkadot’s blockchain infrastructure to assist establishments discover crypto-related alternatives in areas like asset administration, banking, enterprise capital, exchanges and over-the-counter (OTC) buying and selling.
It will even showcase blockchain use instances like decentralized finance (DeFi), staking and real-world asset (RWA) tokenization.
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Polkadot token has dropped 5% for the reason that announcement
While the change might have long-term implications for the Polkadot token’s value, it didn’t have a direct constructive impact. Since the announcement, DOT’s value has dropped from $4.35 to $4.15, a virtually 5% tumble.
However, capping the DOT provide at 2.1 billion is predicted to introduce long-term shortage to the token and scale back inflationary strain, making its worth extra predictable for traders.
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