Polkadot is evaluating a new financial strategy: converting 500,000 DOT tokens into tBTC, a tokenized version of Bitcoin on Ethereum. The initiative aims to gradually accumulate BTC over the next year using an automated recurring purchase mechanism (DCA) developed by Hydration.
Key points of the proposal:
• The “rolling DCA” system by Hydration will be used, allowing users to top up a proxy account that automatically executes DOT-to-tBTC conversions without constant manual intervention.
• A small fraction of the generated tBTC (0.005 tBTC) would be allocated to the Hydration Omnipool through the decentralized Threshold Network bridge.
• The proposal aims to strengthen Polkadot’s Treasury reserves, improve on-chain liquidity, and offer new incentives to DOT’s DeFi ecosystem.
• At the current exchange rate, 1 DOT is approximately equivalent to 0.000041 tBTC.
Context and community response:
• The proposal was introduced shortly after the U.S. SEC delayed its decision on the Polkadot spot ETF, adding a strategic angle to the announcement.
• DOT’s price has dropped 60% so far in 2025, raising concerns within the community and increasing interest in backing the token with a Bitcoin reserve.
• Some community members believe this reserve could help prevent further declines and build confidence in the ecosystem, although opinions remain divided.
Broader trend:
Polkadot’s initiative aligns with a growing trend among governments, corporations, and blockchain platforms seeking to build strategic reserves in Bitcoin. A parallel example is Ukraine, where a draft bill is under discussion to allow the central bank to manage BTC reserves.
