Polkadot (DOT) is the native token of the Polkadot blockchain protocol, created in 2016 by Gavin Wood, one of the co-founders of Ethereum. Polkadot is a multi-chain protocol (layer-0) that enables interoperability between various blockchains, allowing data and assets to be transferred between them. The DOT token serves three key functions:
Governance: DOT holders can vote on protocol changes, including updates and network governance.
Staking: DOT is used to secure the network through the Nominated Proof-of-Stake (NPoS) mechanism. Stakers receive rewards (typically 10-15% per annum).
Bonding: DOT is used to connect new parachains (parallel blockchains) to the Polkadot network through auctions.
Polkadot has an inflationary model: the maximum token supply is not capped, and issuance increases by about 10% annually. As of May 2025, approximately 1.52 billion DOT are in circulation, and the market capitalization is about $7.12 billion (25th place according to CoinGecko). The current price of DOT is around $4.68 (according to Bybit as of May 19, 2025). The historical maximum was reached on November 4, 2021, at $55.13, which is 93.5% higher than the current price.
News and events of Polkadot (DOT) for 2025
Polkadot 2.0 and the transition to Coretime:
In 2025, Polkadot is actively implementing the Polkadot 2.0 model, transitioning from a chain-oriented ecosystem to an application-oriented one. Instead of permanently owning execution cores, parachains now purchase blockspace (Coretime) as needed. This lowers barriers for developers and increases scalability. The Coretime Marketplace model is expected to make the network more accessible to new projects.
The community is discussing burning 100% of the fees for Coretime, which could reduce token inflation and increase its value.
JAM Protocol and Web3 Foundation:
In 2024, the Polkadot community unanimously approved the JAM (Join-Accumulate Machine) protocol, which is a significant step in the development of blockchain architecture. In 2025, the Web3 Foundation launched the JAM Implementers’ Prize with a prize pool of 10 million DOT to stimulate the creation of applications based on JAM. This could attract new developers and strengthen the ecosystem.
ETF proposal on Nasdaq:
In March 2025, 21Shares filed for a Polkadot-based exchange-traded fund (ETF) on the Nasdaq. This could attract institutional investors and increase token liquidity. Similar steps are already being taken for other cryptocurrencies, such as XRP and Solana, indicating growing interest in altcoins.
Institutional support through 265Dots:
In 2025, the 265Dots platform was launched, connecting institutional investors with the Polkadot ecosystem, offering financial products and services to integrate traditional finance with Web3. This could enhance capital inflow into the network.
Updates on the ecosystem and governance:
In June 2025, Polkadot Insider reported two important proposals:
Subsquare Proposal: Improvement of Polkadot's governance interface, including support for AssetHub, identity, proxies, and multi-signatures. This will enhance the ease of participation in voting for DOT holders.
RegionX Hub: Update of dashboards, support centers, and management of Coretime, which will improve the user experience for teams, resellers, and enthusiasts in the Polkadot ecosystem.
Polkassembly also simplifies participation in governance by allowing newcomers to connect wallets, vote, and comment on proposals, strengthening the decentralized community.
Growth of liquid staking:
The Bifrost platform is actively developing liquid staking with the vDOT token, integrating DeFi protocols. In 2025, Bifrost demonstrates high user retention, rapid token creation, and competitive annual percentage yields (APY). This contributes to the growing popularity of liquid staking in the Polkadot ecosystem.
Price forecasts for 2025:
Analysts predict an increase in the price of DOT in 2025 due to new partnerships and network improvements. According to BitcoinWisdom, the price could reach $31.90 by the end of 2025 in a bullish scenario, with a minimum of $13.45 and an average of $14.79. However, in a bearish scenario, the price could drop to $5.38.
TradersUnion suggests that DOT could reach $50 by 2025 but emphasizes the high volatility of the crypto market.
Some users on X express ambitious forecasts, such as $905 for DOT, based on a potential market share of Polkadot at 19% of the total crypto market capitalization ($8 trillion). However, such estimates are speculative and not supported by fundamental data.
Critical opinions and challenges:
In 2024, the co-founder of Manta Network criticized Gavin Wood, urging developers to leave the Polkadot ecosystem. This sparked discussions about leadership and the direction of the project, but by 2025, Polkadot continues to develop actively.
The network faces competition from other platforms like Cardano, Cosmos, and Tezos, which also offer interoperability.
Prospects and risks
Positive factors:
Polkadot remains a leader in blockchain interoperability, which is in demand in the Web3 era.
Active development of the ecosystem, including Polkadot 2.0, JAM, and new financial products, attracts developers and investors.
Integration with institutional platforms and a potential ETF could increase demand for DOT.
High community activity and decentralized governance strengthen trust in the project.
Risks:
High volatility in the crypto market can lead to significant price fluctuations.
The inflationary model (10% annually) could hinder price growth if token burning is not implemented.
Competition from other blockchain platforms and potential internal disagreements within the community.
Conclusion
In 2025, Polkadot continues to strengthen its position as a key player in blockchain interoperability. The DOT token plays a central role in governance, staking, and network development. News about Polkadot 2.0, JAM, ETFs, and institutional support indicate positive prospects, but investors should consider volatility and competition. For those considering long-term investments, Polkadot offers innovative technology and an active community, but decisions should be based on careful analysis and risk management.
