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2025 Polkadot Strategic Development Report: How to Balance Decentralization and Growth to Boost Both TVL and value
In short: A detailed breakdown of the challenges Polkadot currently faces and actionable solutions to address them.
Since the concept of Polkadot was introduced in 2016, it has now been nine years of development. There have been ups and downs along the way, with peaks and valleys, but none of these have hindered Polkadot from improving. Although its overall market capitalization has significantly retreated compared to its peak in 2020, and community attention has declined somewhat, as an innovative blockchain infrastructure, Polkadot continues to forge ahead with determination.
Nevertheless, many still wonder: Why has Polkadot, despite its forward-thinking technology, become a criticized ecosystem in the wake of the public chain boom? As long-time observers and contributors to Polkadot’s development, we (the Polkadot Ecology Research Institute) aim to dissect the current challenges from a unique perspective. Drawing on years of industry experience, we offer strategic recommendations and potential solutions. While not all may be foolproof, we hope to spark meaningful discussion within the market and community.
This report spans over 12,000 words, so we recommend bookmarking it for thorough review. It is the culmination of nearly a month of research, analysis, and writing—a deep dive into actionable insights aimed at supporting Polkadot and its ecosystem. Below, we present our findings. Enjoy.
What Challenges Does Polkadot Currently Face?
We have conducted some questionnaires and also had targeted communications with certain users, developers and major stakeholders. There is a relatively broad consensus among them: compared with other public blockchains that seem to be more centralized, Polkadot is actually too decentralized. As a result, people often yearn for some actions from the “official side”. However, in reality, the absence of the official presence is keenly felt by everyone. This feeling was particularly all-encompassing, especially in the first few years of Polkadot’s development.
- Usability Issues
From a practical standpoint, Polkadot’s difficult-to-use JS interfacehas frustrated users with its poor experience. Over the years, many have called for an official wallet to address these problems, but the ecosystem has largely relied on third-party solutions. While these wallets have significantly improved usability, many users inherently trust official products more, especially when dealing with personal assets.
As a result, Polkadot-JS remains the default (and often unavoidable) interface for many interactions. This becomes even more problematic with complex operations, such as governance participation, where users must navigate convoluted steps on Polkadot-JS. In fact, a significant portion of proposals on Polkassemblyare invalid simply because users made mistakes during submission.
These pain points highlight Polkadot’s critical usability gap—one that third-party wallets alone can’t fully resolve. However, there’s hope: Parity has since established a product team and launched initiatives like Polkadot App, aiming to provide official, user-friendly solutions.
- Ecosystem Support Issues
In terms of ecological support, although Polkadot has various grants, programs like Substrate Builders, and hackathons on the surface, compared to some other public chains like COSMOS, NEAR, and ICP, Polkadot has done quite well in this aspect. But why hasn’t it achieved better results? The author has two viewpoints to share.
The first is that different starting points lead to different outcomes. Currently, the best-performing projects in the public chain ecosystem are Solana and Base Chain. While it may seem that these chains’ official support for the ecosystem is similar to Polkadot’s, Solana and Base teams focus more on pushing things towards success. Their approach is more like a company, providing various resources to teams they want to collaborate with, aiming for mutual success and progress.
On the other hand, Polkadot’s approach is more like a government. They introduce various forms of support, but the execution of these policies often involves many barriers and requirements. Once a team receives support, there is usually no follow-up development. Especially, Polkadot’s hackathons have turned into a place where developers continuously extract benefits, unlike other hackathons where standout projects continue to grow and become successful.
For example, a team that transitioned from Polkadot to Solana mentioned, “There is a significant gap between Polkadot and Solana in terms of ecosystem support. Once you have some resolution with the Solana Foundation, they actively ask if you can collaborate on events and have dedicated personnel operating in various markets. In contrast, Polkadot’s funding has not been allocated to ecosystem projects; instead, they sponsor sports events. Solana’s foundation has individuals operating in various markets who mainly help connect projects, discuss opportunities, and provide advice. Solana’s approach is more akin to American service-oriented companies’ ‘customer success,’ focusing on the success of your business and discussing collaboration to achieve it. When we helped Gavin plan activities in China during Polkadot’s time, it ended there. Recently, when we held events on Solana’s side and received recognition, Solana’s community team actively approached us, asking if they could assist in organizing more themed events.”
It’s evident that different starting points result in vastly different outcomes, especially in terms of proactive versus passive approaches. Polkadot, aiming for decentralization, behaves more like a government, offering incentives and setting standards to select teams that qualify for these incentives. However, once these incentives are provided, it’s challenging for them to actively follow up on the progress.
On the other hand, projects like Solana and even Base Chain actively encourage and support the ecosystem. Their founders even try out products and actively promote them, showing a more supportive attitude towards ecosystem projects. This difference is significant for ecosystem teams.
In reality, the community has always had a somewhat “aloof” perception of Polkadot. Not only do they not actively push certain things (like better UI/UX), but also the official stance tends to convey what they believe are more practical use cases, aligning with the official values and excluding other scenarios. For instance, the official dislike for MEME elements also reflects in how they are not well-received in the Polkadot ecosystem.
(A Telling Anecdote: In December 2023, the DOTA team contributed a substantial 280,000 DOT to Polkadot’s treasury. Come early 2024, they proposed building a Polkadot-native version of Pump.fun - requesting just 20,000 DOT, a mere 10% of their prior contribution in funding. The project was ultimately rejected due to its association with MEME token issuance. This decision not only turned away dedicated builders but also exemplified the ongoing exodus of developers frustrated by Polkadot’s selective support.)
However, these issues have seen some improvement over the past year, including the introduction of a decentralized Polkadot Social Media Editorial Board, which has brought richer content and better outreach to Polkadot’s official channels. Still, the changes remain insufficient, and deeper solutions to the aforementioned problems are needed.
Dr. Gavin Wood has openly expressed disdain for meme culture, dismissing it as “bullshit” and arguing that MEME distract from the industry’s real value.
Similarly, he has labeled generative AI as “bullshitter,” viewing it as a potential threat. While he recently suggested that Web3 could help mitigate AI’s risks, Polkadot’s overly rational approach without actively fostering AI-Web3 integration, remains an unresolved challenge.
I deeply admire Dr. Wood’s ability to filter out noise and focus on solving critical industry pain points, such as blind signing, while steadfastly building the resilient, secure, and reliable infrastructure that Web3 truly needs.
Yet, everything has its pros and cons. While MEME and AI undeniably come with significant issues, they are also rapidly evolving and already demonstrating real-world utility in unexpected ways.
For example, we can observe two evolutionary trends on Base and Solana: MEME are now even being integrated with DeSci to create innovative MEME variants with practical applications, while in the AI domain, various AI Agents have emerged, injecting new vitality into both directions. The “MEME+” and “AI Agent+” trends (referring to the combination of MEME or AI Agents with more practical scenarios or narrative directions) are currently gaining popularity.
Moreover, these directions have received significant support from both Base and Solana. The MEME space speaks for itself, while in the AI Agent field, Base has openly supported Virtual, and Solana has explicitly endorsed Griffain.
Furthermore, MEME represent a cultural phenomenon that embodies consensus value. They can first aggregate basic users and capital through shared beliefs, then channel these resources toward more substantive applications. The potential applications of MEME extend far beyond current perceptions - they can integrate with creator economies and fan economies. Take time.fun as an example: by tokenizing personal time value, the concept could expand to monetize a lawyer’s consultation hours or a celebrity’s private time. Imagine purchasing one hour of a lawyer’s expertise for remote legal advice, or buying three hours of a celebrity’s time for an exclusive dinner. Even this brief conceptualization reveals tremendous potential. Why shouldn’t such innovations flourish on Polkadot?
What’s more, while MEME’ extreme volatility leads many to dismiss them as speculative gambling, their ability to attract substantial capital and users alone delivers tangible value to any blockchain - regardless of their evolving utility.
To illustrate with an analogy: Consider a gold rush town. Even after the mines were exhausted, the infrastructure, commerce and community that developed during the boom became the city’s enduring foundation. Similarly, the “gold rush” of MEME activity could ultimately fund Polkadot’s most meaningful ecosystem developments.
In the context of public blockchains, although many MEME coins have risen to glory only to return to their origins, this process serves as a long-term stress test, verifying the performance of the blockchain and pushing it to continuously improve itself. It also fosters advancements in infrastructure projects on the chain. For example, every major ecosystem boom on Solana, whether it’s NFTs, DePIN, or MEME, has been underpinned by Metaplex’s infrastructure-level enhancements to Solana.
On the other hand, this process also leads to improvements in DeFi, UX, or AI-related infrastructure and products, further optimizing the on-chain experience for users. More importantly, during this period, the blockchain becomes highly attractive because it offers so many alpha opportunities, attracting capital and users willing to engage with Solana long-term. This, in turn, draws high-quality projects to migrate to Solana. For instance, BlackRock’s BUIDL fund has officially entered Solana, and some projects originally on Base have chosen to migrate to Solana for this very reason.
So, can we find a balanced path that accommodates both Dr. Gavin Wood’s poetic and visionary ideals and the prevailing trends in the industry?
Secondly, Polkadot did indeed have certain barriers in the past. For example, many hackathon teams successfully won awards but found it extremely difficult to progress further. After all, what many of these teams were working on either lacked sufficient commercial viability or required becoming a parachain—and operating a parachain is far more challenging than running a DApp. Additionally, back then, Polkadot required winning an auction to secure a slot for block space usage, and building a parachain also meant considering the ecosystem’s development. For many teams, these hurdles raised the difficulty by several notches, making it more practical to simply take the prize money and call it a day.
Of course, there’s another factor at play: if a team was building an application, they had no choice but to deploy on a specific parachain. If that parachain underperformed, their project would suffer as a result. Compounding the issue, Polkadot’s parachain slot auctions were launched right at the beginning of a bear market, which led to the ecosystem starting strong but losing momentum over time.
As a result, despite Polkadot allocating substantial funds to support developers, very few projects made meaningful progress afterward. The efficiency of converting this support into tangible ecosystem growth was disappointingly low.
At the same time, this approach inadvertently encouraged a wave of developers who specialized in “hackathon farming”—exploiting grant opportunities without long-term commitment. This led to inefficient use of treasury and official funds. So, how have other chains managed to foster thriving ecosystems?
First, some chains take a proactive approach by directly engaging with established projects, offering clear and targeted support. For example, BIO Protocol, a DeSci project originally on Ethereum, was invited and supported by the Solana Foundation. Not only did it build Pump.Scienceon Solana, but it also expanded BIO Protocol to the ecosystem, injecting DeSci innovation into Solana.
In contrast, Polkadot’s support, aside from high-profile cases like Mythical Games, which already had a strong user base which has rarely translated into significant user growth for projects. Moreover, technical teams genuinely committed to building on Polkadot have reported receiving minimal support (a recurring complaint among developers). Meanwhile, projects like Virtuals on Base thrived because the Base team provided robust technical and resource backing.
Secondly, the official team can directly involve itself in product development. For instance, Aerodrome, the core DEX on Base, was co-created by the Base team and VelodromeFi, the team behind an established DeFi project. After all, a DEX is the heart of a public chain’s DeFi ecosystem—if issues arise, they could impact the entire chain. The best way to handle such critical infrastructure is to take matters into one’s own hands. By collaborating with experienced DeFi teams, the official team can ensure Polkadot’s technical stability and security, while the DeFi team can prevent common design flaws in DeFi. This approach offers greater reliability.
Thirdly, supporting more projects founded by members of the official team ensures technical robustness and a deeper understanding of Polkadot’s unique features, facilitating the development of more critical or innovative infrastructure. P.S. Based on feedback from discussions with numerous public chain project teams, one clear takeaway is this: Whether it’s the chain’s core team or its users, they tend to prefer native, new projects, as outlined in the second and third points above. The reason is that if established projects are onboarded, they may have already issued tokens.
However, projects that haven’t issued tokens yet hold much stronger appeal for users, something both users and public chain teams favor. Therefore, for Polkadot, the latter two approaches would be more worth considering.
The preference for building native applications is more pronounced in DeFi, but it may not be as effective for other types of ecosystems. For example, in the DeSci narrative, the standout project is BIO Protocol on Ethereum. Such projects are unique—unlike DeFi, where business models and code are largely similar. Thus, by actively bringing BIO Protocol to Solana, the Solana Foundation was able to introduce a major DeSci project to its ecosystem, accelerating the growth of DeSci on Solana.
Introducing leading projects in niche sectors to drive the rapid development of that narrative on a blockchain might be a more suitable strategy for fostering certain trends on Polkadot.
- Operational Level
On the operational front, other public chains tend to take a more proactive approach in gaining exposure, stepping into the spotlight, and even leading ecosystem development. In contrast, Polkadot has primarily focused its heavy investments on promoting zero-knowledge (ZK) technology, previously through the announced Pioneer Prize, and enterprise use cases (such as Parity’s collaboration with Project Liberty). However, these efforts either lack clear outcomes (e.g., no follow-up progress on the Pioneer Prize) or fail to sustain momentum, falling far behind mainstream industry trends (Polkadot has shown little traction in emerging sectors thriving on other chains).
In contrast, other public chain ecosystems are actively learning from the development of other ecosystems that perform better in certain aspects. In particular, the ecosystem developments of the Base chain and the Solana chain have almost been learning from each other, and they have rapidly iterated to become leaders. (The official has also promoted JAM, but JAM belongs to a narrative unique to Polkadot. Here, it mainly refers to the common narrative in the industry.)
Although Dr. Gavin Wood has made efforts over the past year to address this, participating more in events and emphasizing the Asian market, his advocacy has centered more on promoting Polkadot itself rather than actively driving ecosystem growth through targeted outreach and support.
Of course, this is understandable. Dr. Gavin Wood has limited bandwidth. Not only must he focus on the broader vision for Polkadot and the future of Web3, but he also oversees the technical evolution of Polkadot itself. Simply promoting JAM technology alone is already a monumental task.
Therefore, what we hope for is not just Dr. Gavin, but rather more teams and persons in charge representing the official side to take the lead in being responsible for various popular sectors in the industry, and continuously incubate new projects. Ultimately, the evaluation should be based on the achievements of ecological incubation. It should not be the case that certain actions seem to support the ecosystem, but no obvious results are achieved.
One of the most criticized aspects of Polkadot’s promotion is the treasury funds being used to sponsor various racing and sports teams. This leaves a poor impression on average users, who feel the money is wasted, diluted by large treasury sell-offs, and ultimately ineffective.
Developers have even more grievances. They believe that so much capital can be allocated to support matters that have nothing to do with the development of the ecosystem, but the funds are not used to properly support the development of the ecosystem (such as supporting the creation of new projects and the incubation of existing projects), and they are even reluctant to allocate funds to users to encourage them to use their products more.
From the users’ perspective, aside from occasional events and hackathons, Polkadot’s official presence feels minimal. The team appears more focused on technology than token value. Additionally, while Polkadot’s representatives in Asia once actively organized and participated in events, driving research and discussions, such engagement has dwindled. Hackathons still attract developers, but many simply “farm” rewards without translating their work into lasting projects.
Previously, Asia was a hotspot for new Polkadot projects, but now such initiatives are rare. This stark contrast gives users the impression that the official operations have failed to convert resources into ecosystem growth. Of course, DOT’s poor market performance may also be a factor, dampening the willingness of developers, projects, and even VC to build on Polkadot.
Regardless of the reasons, the prevailing sentiment among users is that the ecosystem lacks new projects (even though some still emerge, their frequency pales in comparison to other chains).
Of course, the official team is also actively driving changes by fostering multiple Decentralized Futures (DF) teams. These teams are designed to take charge of advancing initiatives across various domains, effectively serving as upgraded versions of Parity’s marketing, developer relations, business development, and solutions departments. Not only do they offer greater flexibility and higher efficiency, but they also operate externally, mitigating past issues such as inefficiency, bureaucratic bloat, and internal corruption.
While this structure appears to be an enhanced iteration of multiple departments, it lacks the previous advantage of unified collaboration under a single entity working toward a shared goal. Moreover, in terms of information disclosure and outreach, these teams cannot match the visibility of official channels, resulting in limited exposure for many of their critical efforts. We were fortunate enough to interview several DF teams, and only upon deeper understanding did we realize the significant behind-the-scenes contributions they have been making.
A key operational objective now is to enhance collaboration among these DF teams and amplify their visibility, ensuring that users, developers, and project teams can better recognize Polkadot’s growth potential.
- Value Issues
Polkadot users have significant grievances regarding DOT’s market performance, with many holding entry costs at, $20, $30, or even higher. While token value is influenced by numerous factors beyond the team’s control, the community widely attributes two mechanisms as direct drags on value: slot auctions and excessive inflation, both of which users believe require official intervention.
To its credit, the team has already taken steps to address these concerns, replacing slot auctions with Coretime sales and reducing inflation. However, many users still consider the current inflation rate too high and hope for further reductions.
- Summary
The above is basically summarized from the exchanges in the Chinese community of Polkadot and some opinions and feedback of our team regarding the official side of Polkadot. In fact, although Polkadot has many problems, we believe that in addition to issues in mechanisms such as slot auctions or inflation, the main problems stem from various issues arising from the intention of the official side of Polkadot to pursue decentralization.
Decentralization is inherently positive in Web3, but it can hinder progress when an ecosystem is immature, especially in a fast-evolving industry where direction shifts frequently. All these factors require that the development of a public blockchain must have a leader at the helm. Dr. Gavin is in charge of the technology of Polkadot, so we have never worried about Polkadot falling behind in terms of technology. However, the development of Polkadot lacks such a leadership role, which has led to the situation that the development of Polkadot has always failed to keep up with the pace of the industry.
At present, competitors are actively promoting the development of the ecosystem in a very centralized manner, and are able to quickly respond to new narratives and promote the rapid growth of new narratives in their own ecosystems through some means in order to compete for the market share of new narratives in the industry. At this time, Polkadot’s decentralized operations seem to be a bit slow to respond and urgently need to be adjusted.
What Solutions Are There?
Of course, anyone can raise questions and complain, but the key is to implement solutions. Let’s assume a question: How can the Web3 Foundation fill these gaps? What kind of organization or personnel is needed, which does not overlap with the roles of community organizations, and what is the Web3 Foundation that must do that has not yet been done?
1. Balance development and decentralization
1.1 Balance is important
1.2 Regional leaders are very important
1.3 Official teams should actively participate in and lead marketing, operations, and development
(Due to word limits, the content has been omitted here. Please refer to the full report for details.)
2. Strengthening Ecosystem Development
(Due to word limits, the content has been omitted here. Please refer to the full report for details.)
2.1 Critical infrastructure
2.2 The need for an official ecosystem lead
3. Polkadot Needs Stable + Additional Growth Expectations
(Due to word limits, the content has been omitted here. Please refer to the full report for details.)
4. Consolidate and Integrate Existing Resources to Improve Efficiency
(Due to word limits, the content has been omitted here. Please refer to the full report for details.)
5.Creating an Open Culture and Establishing a Favorable Business Environment
(Due to word limits, the content has been omitted here. Please refer to the full report for details.)
6. High-level Strategy is Important
If we consider the building of basic DeFi (Decentralized Finance) infrastructure in the development of a public blockchain as equivalent to a country achieving industrialization in the real world, then for a public blockchain, a higher-level strategy involves how it plans to develop after accomplishing this “industrialization” stage and what unique position it holds among all public blockchains.
Take Tron as an example. Tron has a basic DeFi ecosystem. However, apart from that, its higher-level strategy is to become the largest payment network for USDT. The success of this strategy has brought Tron a substantial cash flow and a large number of users. Additionally, Ton also has its own distinctive high-level strategy.
Polkadot needs to complete the “industrial transformation” one step ahead. Then Polkadot needs to more precisely allocate resources towards more efficient directions for construction. So, based on this principle, what are some suitable strategies? Here are some ideas. (Due to word limits, the content has been omitted here. Please refer to the full report for details.)
①Unblock cross-chain liquidity and support the establishment of the RWA direction
②A brand-new DEX Infrastructure
③DeFAI
④Learn from other public blockchains to ensure new narratives in the Polkadot ecosystem
Hope Ignites from the Buds
The growth of Polkadot has always been a topic of great concern. In the past two years, we’ve released two in - depth articles with significant strategic implications. While some content may have become outdated, many crucial conclusions remain relevant. If you’re interested, you can check them out:
Polkadot Growth Strategy Report: Building a Continuously Growing Future for Polkadot. Polkadot Growth Strategy Report: Building a Continuously Growing Future for Polkadot | by Polkadot.ERI | Medium
What If Polkadot Had an Election? How Should We Formulate a Development Program for Polkadot? What If Polkadot Had an Election? How Should We Formulate a Development Program for Polkadot? | by Polkadot.ERI | Medium
Of course, it’s not just us. Many senior experts in the Polkadot ecosystem have also contributed their development strategies for Polkadot. For example, Alice und Bob, a senior Polkadot expert and co-founder of ChaosDAO, has published a detailed strategic report on Polkadot: Polkadot Growth Strategy. The report covers a wide range of aspects and is of great reference value.
Even better news comes from the official side. Currently, the Web3 Foundation has appointed a new Head of Ecosystem Growth: https://x.com/alexdimes7/status/1892224123138462008. This is a great start. Moreover, recently, Alex has also introduced the preparations needed for the launch of the Polkadot Hub: A Polkadot Hub launch update from Business Development group: April, 2025.
Many of the measures are highly consistent with the solutions proposed in our article. These include uniting numerous organizations to jointly promote matters and regarding DeFi as a fundamental part of the growing ecosystem for developers and users. All of these are very positive signs of improvement, and they seem to give us hope for a booming Polkadot ecosystem in 2025.
As a team that has been involved in the construction of the Polkadot ecosystem for over six years, we have not only witnessed and supported Polkadot’s early successes but also personally experienced the development challenges it has faced in the past few years. However, we continue to contribute to the Polkadot ecosystem because we believe that Dr. Gavin Wood’s Web3 vision will eventually come true, and we still have high expectations for Polkadot’s future. These are just some of our thoughts, and we hope they can be helpful to the builders in the Polkadot ecosystem. We also welcome you to share different opinions and have discussions.
P.S. Due to the forum’s word limit, the above content shows less than half of the original text. You can view the full version at this link.