Polkadot co-founder Gavin Wood unveils plans for the ecosystem’s native decentralized stablecoin on the network. The stablecoin will be collateralized to the protocol’s native token DOT.
On the first day of the Web3 Summit 2025 on July 17, Wood discussed the protocol’s plans to launch a fully decentralized stablecoin. The stablecoin, which will be pegged to the project’s native token DOT (DOT), is designed to advance capital efficiency and scalability.
So far, the token has yet to be formally launched on the market. It is still in the early stages, with Wood revealing that a treasury proposal aimed at bootstrapping initial liquidity is currently in the works.
This means that once the proposal gets shared to the community forums, it will need to receive community feedback and a majority vote of approval from DOT token holders before the it can get deployed.
If it gets approved, this will be the first time a stablecoin pegged solely to Polkadot’s native token DOT gets a formal launch.
At press time, DOT has gone up by 1.54% in the past 24 hours. It recently reached a peak of $4.26 on July 17. However, it experienced a slight correction and fell a few points back to $4.19 shortly after. In the past week, the token has jumped by 14.7%.
Polkadot’s token market cap has increased slightly by 0.23%, reaching $6.3 billion.
Polkadot’s daily trading volume surged by 30.9% in the past trading day, reaching nearly $500 million. This indicates a recent rise in market activity for the token that is poised to become the sole liquidity holder for the upcoming stablecoin.
Back in 2022, there was already a stablecoin linked to DOT. Ethereum-compatible project Acala launched the USD-pegged stablecoin aUSD which was designed to become the foundational stablecoin to support the Polkadot and Kusama ecoststems. The token lets users mint aUSD by locking assets such as DOT and LCDOT (Acala’s liquid DOT) as collateral.
To bootstrap growth, Acala launched a $250 million aUSD ecosystem fund to support early-stage projects on Polkadot parachains with a strong aUSD use case.
However later in September 2022, Acala Network experienced an attack which led to the aUSD stablecoin getting depegged by more than 99% of its value.
