Polkadot DAO Caps DOT Supply at 2.1 Billion

The Polkadot DAO has carried out its most notable economic change up till now. On October 18, 2025, the account of Polkadot announced a plan to limit the total supply of DOT to 2.1 billion, and to halve the further emission after every 2 years, starting March 14, 2026.

This giant turnover is the reflection of halving in Bitcoin. Polkadot is able to govern itself, and the power of community led governance in the DAO is proved by the high 81% vote of Referendum 1710. With Polkadot changing to a scarcity-based system, market now awaits its impact on the demand and the price trend of DOT.

Inflation to Scarcity

There are 1.63 billion tokens in circulation at DOT at the moment. Preceding this vote, the network was releasing 120 million new DOT each year and this generated an inflation rate of 10%. The old route would have had a DOT supply of more than 3.4 billion by 2040, which would have diluted long term holders. The DAO fixed a fixed number of 2.1 billion tokens, which would not be diluted at any time after this point. Such a transformation reduces the growth in projected supply by 40 percent and turns DOT into a scarce commodity as opposed to an inflationary currency.

Beginning March 14, 2026, the decrease in the number of DOT issuance will be by half after every two years. This is a replica of the halving schedule of Bitcoin but is modified to suit the multi-chain structure of Polkadot. Issuance is reduced to 120M DOT annually, to 60M and then 30M. By the year 2040, the circulation supply will be approximately 1.91 billion DOT- a lot less than the initial course. March 14 (Pi Day) has become the start of every new issuance cycle with the community now having a regular pattern to look forward to.

Market Response

In spite of such structure change, market indications indicate that traders are yet to fully factoring in on the change. At the time of the release of the video, DOT was trading at $2.87, and the market cap is approximately $4.69 billion. Polkadot argues that DOT is underpriced because it is perceived to be high inflation, rather than scarcity.

The community anticipates that this gap would reduce in 2026 when the first issuance cut comes into effect. With a higher demand than supply that is capped, DOT might experience another bull cycle as occurred with Bitcoin after halving periods. Polkadot will provide elastic scaling to increase throughput and reduce the latency between parachains. This upgrade will enable the network to support real-time applications, such as DeFi, enterprise systems, and gaming.

Asynchronous Backing and Agile Coretime

Asynchronous backing is more efficient in block production, whereas Agile Coretime puts forward fresh methods of renting or monetizing parachain slots. The JAM (Join-Accumulate-Meaning) protocol is the one that will unite Polkadot and Kusama in a single system and enhance flexibility and innovation within the ecosystem.

Such a combination of both technical and economic changes makes Polkadot more a direct competitor of Ethereum, Cosmos, and modular L2 solutions. This change was provided by Polkadot through transparent voting on the chain. Polkadot allows decision-making by holders of tokens, unlike those protocols that have a founder drama or are centrally controlled.

The community is capable of facilitating meaningful upgrades without disintegration because the supply cap approved by the DAO shows that the community can succeed in doing so. OpenGov is the system through whichDOT holders submit, delegate, and vote on proposals and this seemed to be lauded in the announcement video.