- Polkadot has proposed converting 501,000 DOT into tokenized Bitcoin (tBTC) over a year to diversify its treasury and reduce reliance on a single asset.
- The move aims to strengthen financial stability amid market volatility, even as DOT struggles with a 25% monthly price drop.
DOT Eyes Financial Resilience with Gradual $1.9M BTC Reserve via Hydration Protocol
Polkadot (DOT) is taking a bold step toward treasury diversification with a new community-backed proposal to integrate Bitcoin into its financial ecosystem. In a strategic move, the proposal suggests converting 501,000 DOT tokens—worth roughly $1.9 million—into tokenized Bitcoin (tBTC) over the next year. The idea has triggered vibrant discussions in Polkadot forums, with the goal of enhancing the protocol’s long-term financial resilience.
Why Polkadot Wants Bitcoin in Its Treasury
While DOT remains vital for governance and growth within the Polkadot ecosystem, the reliance on a single token leaves the treasury vulnerable to extreme market volatility. As such, Bitcoin’s historical performance and role as a digital store of value present a compelling hedge. By integrating BTC, Polkadot aims to reinforce trust in its financial infrastructure while embracing the multi-chain future it champions.
Bitcoin isn’t just a diversification tool—it’s a signal. The proposal shows Polkadot’s commitment to strengthening its foundation amid an uncertain macroeconomic environment and turbulent crypto markets.
Also read: Ripple vs. SEC Update: $125M Settlement Proposal Gains Support as Former Official Backs XRP Lawsuit Resolution
How the BTC Integration Would Work
The proposal outlines a methodical approach using Hydration’s rolling dollar-cost averaging (DCA) strategy. Instead of a lump-sum purchase, the community plans to convert DOT into tBTC gradually over a year. Small BTC increments (0.005 tBTC) will then be added to the Hydration Omnipool to boost DeFi liquidity and deepen Polkadot’s ecosystem utility.
Security remains a top priority. The Bitcoin-Polkadot bridge will leverage Threshold Network’s non-custodial solution, ensuring the BTC reserve remains decentralized, verifiable, and secure.
DOT Price Outlook: Crucial Support at $3.60
At the time of writing, DOT trades at $3.80, following a 6% daily drop and a staggering 25% monthly slide. If it loses the key $3.60 support, further price consolidations may follow. However, should this zone hold as the bear cycle bottom, a rebound could reward patient holders.
The proposed Bitcoin reserve adds a fascinating twist to Polkadot’s financial strategy—one that could shape its long-term trajectory, both in stability and investor confidence.
