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- In a bid to follow a more deflationary path, the Polkadot fellowship has voted in favor of a new proposal.
- Courtesy of the proposal, Polkadot will burn revenue for significant sales and in turn decrease the existing supply of DOT.
The Polkadot network is on a journey to become even more deflationary, following the approval of a promising upgrade. The benefits of the newly approved proposal can strengthen Polkadot’s position as a leading Blockchain network. Additionally, the upgrade can trigger a global increase in the interest and adoption rates for Polkadot (DOT).
Network validators have collectively voted to approve a promising proposal. The proposed upgrade is designed to cut down on the existing DOT token supply on the network. The upgrade, dubbed the RFC-10, will specifically burn revenue secured from sales recorded on the network’s core time.
Taking to X, Gehrlein Jonas, a Polkadot and Web3 researcher shared the new development with Polkadot community members;
“RFC#10 has been approved by the fellowship! Coretime sales revenue will initially be burned, adding a second deflationary mechanism to Polkadot.”
In the long term, DOT could record an increase in interest rate from global cryptocurrency investors, as a reduction in token supply often positions an asset as a more stable cryptocurrency. Once the adjusted supply dynamics impact the market, DOT’s value will be better positioned to record an increase in price value.
DOT bulls are struggling to stay afloat as altcoins collectively make a downward spiral
Assets like Shiba Inu, BNB, and Ether have also remained committed to carrying out token burns. The results have historically been positive for the assets. In the case of Shiba Inu (SHIB), a notable 410 trillion Shiba Inu burn triggered a 1600% increase in Shib’s price value.
At present, Polkadot’s Treasury currently accounts for the majority of income generated from fee charges. These incomes also make up for thousands of DOT tokens burned for months. The rest of these tokens is later reserved for the development of the funds on the Polkadot ecosystem.
An upgrade to Polkadot 2, will largely change the current model of the network, by integrating a new and improved outlet for Treasury income which it refers to as “core time sales.”
At report time, DOT trades at a press time price of $7.67. Daily and hourly losses are yet to be fully cleared. Similarly, market cap trading volumes have collectively lost 8.87% of their value. It is important to note that the current bearish trend is not a DOT-specific experience.
Other altcoins are also recording a mild decline in price value. This comes not long after Bitcoin surged past the $52,000 price level after institutional investors stormed the Bitcoin Spot ETF market. DOT bulls might correct upwards with its peers if altcoin selling pressure reduces in the coming days.