A contentious new initiative aimed at converting 500,000 DOT, approximately valued at $50 million, into Bitcoin has ignited a lively debate among members of the Polkadot community.
The proposal, which originated from a community member known as hippiestank, aims to enhance the Polkadot treasury’s financial resilience by establishing a strategic Bitcoin reserve.
Community Split Over Plan to Turn 500K DOT Into Bitcoin for Strategic Hedge
Introduced in early June, the initiative suggests employing a dollar-cost averaging (DCA) strategy to systematically acquire Threshold Bitcoin (tBTC) over a one-year period.
Proponents of the plan argue that Bitcoin could serve as a protective measure during market downturns, while simultaneously enhancing on-chain liquidity and encouraging growth within Polkadot’s DeFi ecosystem. However, there are considerable dissenting views.
POLKADOT COMMUNITY EYES BITCOIN RESERVE USING 501,000 DOT
– The Polkadot community floated a proposal to create a Bitcoin reserve using 501,000 $DOT.
Key Details:
– The proposal plans to convert 500,000 DOT into tBTC, a Bitcoin-backed token on Ethereum, utilizing Hydration’s… pic.twitter.com/YXSQVhc9fE
— BSCN (@BSCNews) June 13, 2025
The conversion process involves Hydration’s automated platform that would facilitate the transactions through a proxy account that supports a rolling DCA schedule.
A nominal amount, specifically 0.005 tBTC, would also be integrated into the Hydration Omnipool to foster liquidity via Threshold Network’s decentralized bridging system.
The proposal estimates a rate of 1 DOT equating to approximately 0.000041 tBTC.
The initiative has polarized opinions within the Polkadot ecosystem. Supporters advocate for Bitcoin’s role as a safeguard against market volatility and a means of value preservation.
“This proposal is about risk management and operational continuity, not market timing or speculation,” the proposer stated in an online discussion.
They contend that postponing diversification efforts for optimal market conditions would leave the treasury vulnerable.
Opponents have raised concerns regarding the timing of the proposal. With DOT trading near its yearly lows and Bitcoin maintaining a steady price above $100,000, some community members are skeptical.
One critic remarked, “I just don’t see how we can do this and for it to really provide any value, short or long term… it’s likely to do more harm than good with the additional downward pressure that we’re already contending with.”
Despite the concerns, the proposal emphasizes that the goal is not about speculative market timing, but rather about securing the network’s future.
“I believe the ‘DOT ATL, BTC ATH’ argument misframes the situation. This proposal is about risk management and operational continuity, not market timing or speculation,” the proposer reiterated.
Some members of the community have also expressed worries regarding transparency and the inclusiveness of decision-making processes.
One participant suggested that the proposal should gain wider exposure on X (formerly Twitter) prior to any advancement, reflecting a broader tension over the distribution of authority between a select group of forum contributors and the larger community.
Ongoing discussions indicate that the proposal author is willing to move towards a vote on-chain as early as next week, contingent on community feedback.
If the proposal is approved, Polkadot could become one of the few blockchain ecosystems to explore a Bitcoin-backed treasury, potentially setting a significant precedent in the industry.
The debate surrounding this proposal encapsulates the larger question of whether it serves as a protective measure or poses a risk, leaving the decision to the community.
Corporate Bitcoin Reserves Surge as Polkadot Joins Institutional Trend
The potential $50 million Bitcoin reserve initiative by Polkadot aligns with a wider trend where numerous corporations are increasingly recognizing Bitcoin as a vital component of their treasury strategies.
Just recently, Nasdaq-listed fintech company Mercurity announced its aim to raise $800 million to establish a Bitcoin reserve.
Mercurity Fintech Holding, a digital finance firm traded on Nasdaq, has announced plans to raise $800 million to establish a Bitcoin reserve. #Bitcoin #Mercurityhttps://t.co/wW04xWFkRx
— Finance Newso.com (@Finance Newso) June 12, 2025
The firm seeks to incorporate BTC into its blockchain-native reserve structure through mechanisms like custody, staking, and tokenized treasury management solutions.
If successfully executed, Mercurity’s reserve would position it among the leading corporate holders of Bitcoin, potentially even surpassing GameStop, as indicated by data from Bitbo.
This trend highlights a marked increase in institutional adoption of Bitcoin.
As of June 2025, around 223 publicly traded companies have added Bitcoin to their balance sheets, a significant rise from 124 a year prior.
Collectively, these companies now hold over 819,000 BTC, amounting to approximately 3.9% of Bitcoin’s total supply, according to BitcoinTreasuries.net.
In parallel, Polkadot is also advancing its commitment to crypto-centric tools.
A community-approved launch of a non-custodial, Visa-compatible payment card on the Polkadot network reflects broader ambitions in the realm of crypto-finance, with Bitcoin playing a central role in those strategies.
This wave of corporate Bitcoin adoption signifies a significant shift in the landscape, suggesting that it is becoming a core strategy rather than an anomaly.
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