2025-Q1 Polkadot Treasury Report

alice_und_bob · May 15, 2025, 2:54pm

Introduction

This is the 2025-Q1 Polkadot Treasury Report. It is part of the Treasury Report series and is an important tool for informing Polkadot stakeholders.

Key Insights

The Balance Sheet shows 135m USD (33.5m DOT).
- On the asset side…
  - 102m USD (25.3m DOT) are free for spending. 6m USD of the cash reserves are available as stablecoins, with an additional 2.9m DOT (11.5m USD) allocated to automated stablecoin acquisition.
  - 25m USD (6.2m DOT) are earmarked for strategic initiatives such as marketing, DeFi tooling, gaming, BD, etc.
  - 7.8m USD (1.9m DOT) are deployed into DeFi market operations.
- 3.6m USD (780k DOT) in liabilities are payable until the end of the year.
Expenses
- The Treasury has spent 18.6m USD (3.9m DOT) in 2025-Q1. The operating loss before inflation and burn is 3.8m DOT. Accounting for inflation and burn, the net profit is 80k DOT.
- The top 3 spending categories were Outreach (7.5m USD), Development (5.6m USD), and Operations (2.1m USD)
- Departments (Bounties and Collectives)
  - 30% (5.6m USD, 1.1m DOT) of the spending happened via departments
Stablecoins: 5.9m USD have been acquired in stables. 11.9m USD in stables have been spent.
OpenGov is deploying capital into the economy: 7.7m USD are provided as liquidity into 4 different DeFi protocols
Accounting for inflation and burn, this was the first net positive quarter of the Treasury since we report on it.
Polkadot has 10 years worth of reserves. Thanks to the recently changed inflation model, the Treasury’s long-term perspective has become very stable.

About this Report

The Polkadot DAO manages millions of USD in assets. As such, it follows accounting best practices and pioneers them for the Web3 space. The report comes with a balance sheet and income statement. The balance sheet will give a complete overview of all active accounts the Treasury manages and how assets are distributed over its operations. The income statement will break down the categories in which the Treasury spends.

We express our gratitude to the Web3 Foundation for funding this report as part of the OpenGov.Watch initiative. Thanks also to the OpenSquare team for providing an API to fetch spending data via their dotreasury.com project, as well as the Parity data team for providing additional data.

Authors: Alice und Bob, Jeeper

Introduction to the Polkadot Treasury

To help newcomers to Polkadot read this report, we want to begin by offering a few ideas that guide the strategic decision-making of many voters. DAO contributors (”agents”) ensure that the Treasury aligns on strategic initiatives:

As the guiding strategic principle, Polkadot is committing to the core vision of Web3: Apps that put users back in control of the Internet! Its ecosystem has to be understood as the Polkadot Cloud. A complete stack of Web3 services that allow builders to create powerful and scalable applications and business cases at a fraction of the cost of other ecosystems.
Polkadot is unstoppable. It sustains itself.
Research, development, and operations all focus on delivering secure and resilient core Web3 infrastructure. Bridges, wallets, data services, SDKs, governance and developer tooling, and nodes are all paid for by OpenGov. As a result, the network is not dependent on external
organizations.
Polkadot’s growth thesis is centered on enterprise adoption in key verticals. Its business development and market operations are focused on winning market share in (1) DeFi, RWA & Fintech, (2) Gaming & Entertainment, (3) AI & DePin, (4) Social and Identity, and (5) GovTech. Decentralized business development teams work with investors, accelerators, and ecosystem support teams to help teams onboard and succeed in Polkadot.
Polkadot is developing its talent pool. The Polkadot Blockchain Academy provides multi-week in-person education to hundreds of founders and developers multiple times per year to provide new projects with qualified personnel. In addition, hackathons around the globe expose thousands of devs each year to Polkadot’s tech stack.
Polkadot’s outreach effort is unmatched by any other DAO. From content creation in Polkadot-native media brands to distribution, to advertising. From market research to running a decentralized ambassador program and hosting and participating in global events. All of these functions are now operated by the DAO, removing the risks of single points of failure.
OpenGov is differentiating into specialized departments, scaling up its throughput capacity. Dedicated departments composed of domain experts are forming around key ecosystem functions (e.g. marketing, FinTech integrations, etc) to streamline the processing of related proposals. This reduces the load on the main OpenGov voting tracks and allows stakeholders to focus on high-level decisions.

Balance Sheet

The balance of the Polkadot DAO at the end of 2025-Q1 comes out at 33.5m DOT / 135m USD. Accounting for liabilities, there is a surplus of 32.6m DOT / 131m USD.

Assets

You can find the full sheet here.

Assets Structure

For the balance sheet, we structure the assets as follows:

Cash and cash equivalents: 25m DOT / 102m USD
Designated assets: 6.2m DOT / 25m USD
Non-custodial liquidity provision: 1m DOT / 4.1m USD
Loans receivable: 923k DOT / 3.7m USD

Cash and Cash Equivalents (25m DOT / 102m USD)

This category consists of DOT, USDT, and USDC which are immediately or very quickly available for the Treasury’s use. Cash is held on the relay chain and AssetHub system chain.

Relay Chain: 16.6m DOT (67m USD)
AssetHub:
- 4.3m DOT (17m USD)
- 4.8m USDT (1.2m DOT)
- 11k USDC (2.8k DOT)

In addition, a trustless and fully automated stablecoin acquisition campaign has successfully concluded, while another one is still running on the Hydration DeFi chain

Stablecoin acquisition campaign #2 still has about 2.9m DOT (11m USD) to be swapped until 2025-Q3
an additional campaign for 5m DOT was approved after the balance sheet cut-off date

Designated Assets (6.2m DOT / 25m USD)

Designated assets are assets that are under the control of OpenGov, but are already earmarked for specific jobs, primarily to fund its executive bodies (bounties and collectives). In addition, Polkadot holds 1m USD in MYTH to be deployed through airdrops to DOT holders.

Bounties

Polkadot has 14.2m USD (3.5m DOT) sitting in bounties, ready to be distributed to teams that perform value-adding activities in the ecosystem. (To learn more, book a free consultation here)

Technical Fellowship

The Polkadot Technical Fellowship is the core maintainer of the runtime. They are funded through the DAO. They have two accounts:

Salary account: 2.0m USDT (506k DOT)
Spending account: 2m DOT (7.8m USD)

MYTH Airdrop

As part of Polkadot’s strategic partnership with Mythical, it acquired MYTH tokens in exchange for 1m DOT. 2.3m USD-equivalent of MYTH were already distributed to DOT holders. A remaining reserve of 470k USD-equivalent MYTH remains within the MYTH distribution account to be used in the future.

Non-Custodial Liquidity Provision (1m DOT / 4.1m USD)

The Treasury deploys some of its idle capital into the Polkadot economy. 1m DOT (4.1m USD) sits in the Hydration Omnipool as DOT liquidity.

Loans Receivable (923k DOT / 3.7m USD)

These positions are the custodial counterparts of non-custodial liquidity provision.

1.5m USDT has been deployed to Centrifuge RWA Yield Pool
Bifrost has deployed 500k DOT into its liquid staked DOT product
Pendulum has borrowed 50k DOT for its stablecoin bridge vaults

Assets Portfolio

The Treasury holds DOT, USDT, USDC, and MYTH. The Treasury’s biggest position is in its native asset DOT, with 30.9m DOT (124m USD) making up 92% of the portfolio. The stablecoin portion of the Treasury is 5.8% USDT (7.8m USD) and 1.6% USDC (2.1m USD). MYTH about to be airdropped makes up 0.35% (470k USD).

Assets by Chain

Polkadot holds assets on 7 different chains. Parachains area significant part of the Treasury economy, with 15% of the Treasury’s owned assets being deployed on various DeFi chains like Hydration (16.9m USD), Centrifuge (1.5m USD), Bifrost (2m USD), and Pendulum (201k USD). Polkadot Governance allows decisions to be executed trustlessly across all chains under the Polkadot security umbrella. 85% of the Treasury is held on 3 system chains to be used as free cash and for the various executive bodies.

Liabilities

The Polkadot Treasury has introduced a mechanism for scheduled payments. They are intended to schedule a series of e.g. monthly or quarterly payments. We treat them as “claims payable” in the balance sheet.

Claims payable in total make up 3.5m USD (870k DOT).
Wages payable for the Technical Fellowship come out at a maximum of 250k USD per 28-day cycle.

Claims Payable

Claims on future payments have been granted in the amount of 3.5m USD. These consist of 640k DOT, 310k USDC, and 2.8m USDT. They last until December 2025.

Income Statement

For the income statement, we use DOT as the primary unit of account, since it is the unit that the Treasury income, inflation, is based on. For the expenses section, we will additionally provide a USD-denominated table, since expenses are part of the income statement that is also relevant to understand in stable terms.

Polkadot has had expenses of 3.8m DOT (18.6m USD) in the first quarter of 2025. After adding revenue, inflation, and burn, the net earnings were 80k DOT.

This results in 2025-Q1 being the first slightly net positive quarter of the Treasury since we are recording income statements.

Expenses

Polkadot spent 18.6m USD (3.8m DOT) in the first quarter of 2025. The biggest position is Outreach, leading with 7.5m USD (1.5m DOT). Development of new software came next with 5.6m USD (1.2m DOT). Operating the network infra cost 2.1m USD (420k DOT). Business Development initiatives totaled 1.9m USD (400k DOT). 860k USD (200k DOT) were spent as incentives for the economy. 740k USD (120k DOT) was spent on research.

We will dig into the details below, but before we do so, let’s look at what categories Polkadot spends money on.

Spending Overview

We see a continuation and consolidation of the trend of the second half of 2024 with moderate spending. 2025-Q1 was heavy on Outreach and Development. Business Development and Research were below their averages. Operations is fairly stable and was hitting close to its average. And it was the second quarter in which economic incentives were granted. Talent & Education did not register any spends in the last quarter.

Now let’s dive a bit into the individual categories!

Outreach

7.5m USD was spent on outreach for marketing, event, and community building. The Outreach category is the biggest and most complex. It contains not only subcategories but also sub-subcategories. The most relevant clusters are around marketing and events. We will start by looking at them individually.

Marketing, PR, Advertising, and Community Management in total made up 5.5m USD. A partnership with Brave (3m USD) to integrate Polkadot into the Brave browser is the biggest position in this category. PR (870k USD) efforts receive increasing attention, with Bitwire (520k USD) and Distractive (300k USD) being the biggest service providers.

Content Creationg & Distribution (520k USD) covers Polkadot content goes beyond simple advertising. The Kusamarian (390k USD) leads the field as Polkadot biggest native media brand. Dotcast Media received 76k USD for Spanish content. Influencer campaigns (470k USD) included Growgami (190k USD), Kaito (150k USD), and Fracas (100k USD). The Marketing (440K USD) subcategory includes several general spends, as well as two gaming related outreach efforts: GiantX advertising in eSports (170k USD) and 60k USD to support the Evrloot game. Digital Ads (140k USD) went mostly to Coingecko (110k USD). Social Media & Community Management teams were funded with 100k USD.

Polkadot spent 1.5m USD on events. Conference attendance & side events (1.3m USD) covered the most part of that. 450k USD went to Bash events. The infamous Blockspace Hackerhouse Mansion at ETHDenver was funded with 170k USD. Participation at Consensus Hong Kong (160k USD), Crecimiento LATAM (112k USD) and a retroactive proposal for The Blockspace at Consensus (100k) are the other ones above 100k USD. Meetups had costs of 270k USD and were split up among 74 events globally.

Other items in the Outreach category include Ambassadors & Agents (410k USD) with the Polkadot Ambassador Program getting bootstrapped with 270k USD and Polkadot Africa supported with 90k USD. William, a notable Polkadot ambassador received 45k USD.

Development

Development (5.5m USD) covers software development specifically for the core Polkadot infrastructure and tools necessary to operate and interact with the network.

Data Services & Indexing covered 1m USD for Token Terminal and 170k USD for Giant Squid. Bridges: Ongoing payments for Snowbridge made up 1.2m USD. Under Polkadot Protocl & SDK, the Polkadot-API was supported with 660k USD, while Fellowship salaries totaled 290k USD. In Wallets, NovaWallet received 1m USD.

Interstellar account abstraction was funded with 600k USD. Block explorer Subscan received 250k USD to build new features. In Developer Tooling dAppForge, an IDE plugin for Substrate and ink! development, received 120k USD. RegionX, a coretime marketplace, was funded with 90k USD.

Operations

Operations (2.1m USD) covers software and hardware essential to operate the network.

RPCs were funded with 890k USD. Explorers (760k USD) funded Polkassembly (530k USD), Subscan (160k USD) and Statescan (67k USD) for their next periods. Data Service SQD received 260k USD. The Testnet Paseo cost 110k USD. The Polkadot Staking Dashboard received 82k USD.

Business Development

Business Development (1.9m USD) efforts focused on market penetration of several verticals and DevRel-related activities, as well as funding niche-specific tech and experiments.

Games (800k USD) again lead the category with the games bounty funding strategic initiatives for 500k USD and Blockdeep receiving 300k USD for Mythical airdrop related services. 350k USD were spent on privacy solution Peer3, a peer-to-peer smart contract SDK. Ideal Network, a randomness beacon project, received 300k USD. Security audits were subsidized with 220k USD, DeFi integrations with 180k USD.

Economy

image (13)

Economy (860k USD) consisted of the DeFi Singularity campaign to incentivize bridged DOT and vDOT.

Research

Research (740k USD) funds projects that are experimental, research-driven, or surface new data. OG Tracker received funding of 600k USD for its next phase.

Departments (Bounties & Collectives)

Departments, (sometimes also referred to as executive bodies) are subDAOs that are set up to develop a certain area of the ecosystem. They simplify OpenGov by taking care of a certain area, reducing mental load and volume on the general voting tracks. Since 2024-Q3, executive bodies have processed ~30% of the total spending. Keep in mind that these costs were already represented in the previous chapters and this is just a different perspective to represent them.

Bounties

Bounties are similar to departments in traditional organizations. Bounties have a specific mandate to spend money to achieve certain goals. Collectively, Bounties spent 5.3m USD, 28% of the total expenses in 2025-Q1. On top, we have the Marketing (2.2m USD) and Events (950k USD) bounties, focusing on outreach. The Infrastructure Builders Program operates crucial node infrastructure, costing 720k USD. Then we have two business development bounties, Games (500k USD) and DeFi and Infrastructure (180k USD), working to bring more business in those areas to Polkadot. The Polkadot Assurance Legion provided security audits worth 220k USD. Paseo did cost 110k USD in the first quarter of 2025.

Collectives

For the last time, we will only cover the Technical Fellowship as a collective. Data for the newly launched Ambassador Fellowship is still coming in and will be part of the next report. For the technical Fellowship, the following salary costs have accrued:

2025-01: 95k USD
2025-02: 92k USD
2025-03: 103k USD

For the first time, we are reporting on Technical Fellowship Subtreasury spends. In 2025-Q1, two positions were paid out, resulting in 38k USD spending.

Analysis

Stablecoins

In this chapter, we want to look at the historic and projected stablecoin flows.

Historic Stablecoin Flows

In total, the Treasury has been accumulating 16m USDC and 16m USDT from 2024-03 until the end of 2025-Q1, an average rate of 2.4m USD in stables per month.

Spending has been keeping pace with inflows, with 14m USDC and 12m USDT going to proposers. 1.5m USD of idle USDC was also put into a liquidity loan towards Centrifuge.

Stablecoin acquisition campaign #3 has just been approved by OpenGov and will lead to an inflow of 2.8m USD in stables per month.

Trend

In the long-term trend, we can see that the DOT-denominated balance and cash are trending slightly up. Since the Treasury is still very heavy on DOT, the overall Treasury value still correlates strongly with the DOT price.

Balance Sheet Development

This quarter added 2m DOT to the balance sheet, thanks in part to being deversified into stables. The same diversification also stabilized the USD-denominated value to some extent, but still correlates with DOT price:

Treasury Cash Development

The available cash is also up 2m DOT, but down in USD.

Notes

Code
The raw data for this report can be found in the following places:
- Google sheet with pivot tables and charts: Sheet
- Github: **data**
Changes to methodology
- “Claims”: We fine-tuned when spends are accounted and now consider deferred spends from the spend.local() extrinsic when they occur, not when the spend is approved.
  - To do this,
    - we fetch a table of Treasury spends. We evaluate boolean columns Claimable (valid from is before today) and Expired (expire at is before today) for later filtering.
    - In the Referenda table, we check if spends reference a ref, and if so, we mark “isClaim” in a dedicated column.
    - In the Aggregated table, we filter out claims from direct spends. We add a new pivot table to the union that filters by status paid
  - We applied this retroactively, which marginally changed some charts and tables compared to previous reports.
- “Fellowship”: We added Fellowship spends to the analysis. The table is added as pivot to the union in the Aggregated table.
- “Stable Flows”:
  - We pulled a table with all cross-chain and on-chain transfers of the AH Treasury account.
  - For cross-chain transfers
    - Clean the one row that is not a stablecoin transfer
    - Add custom columns for USDC and USDT that represent the value of the row
  - Create pivot tables for cross-chain inflows, local outflows, local inflows and a summation table
For ease of readability we generally round to the two most significant digits.
Data Acquisition Methodology
- We extend our thanks to the Subsquare, the Parity data team, and
  lolmcshizz for providing valuable data and inputs for this report.
- Balance sheet values
  - intra-day exchange rates for DOT and MYTH were retrieved on 2025-03-31 from Coingecko
  - token holdings on accounts were retrieved via Subscan
  - The DOT amount in the Hydration Omnipool is retrieved from the Hydration UI
  - Outstanding wages payable are retrieved from the SubSquare collectives UI
  - Bounty holdings are retrieved from SubSquare
- Income Statement
  - Referenda and child bounties were fetched through Subsquare’s API. Code is here
    - Determination of DOT and USD values
      - We do deep inspection of calls to build a bag of different assets.
      - For a given date, the bags value in DOT or USD equivalent is then calculated according to market rates at those days
      - Bounty and XCM send values are assumed 0. Typically they just move
        DOT into designated accounts and later spending can then be recognized
        independently
      - batch calls are traversed
  - Full bounty spend: Two instances in the relevant timeframe is recorded. These were manually taken from Subscan
  - Collective spend DOT values are approximated by taking the DOTUSD price in the middle of the period.
  - Inflation, Burn, Fees, and other values have been provided on a monthly basis by the Parity data team.
  - To estimate Forex earnings/losses from T1 to T2, we calculated (BalanceT1 - BalanceT2+NetEarningsT2). We believe that this is the only explanation for the difference of a
    DOT balance. Since the balance is also calculated by calculating the DOT value of USD stables with the exchange rate on the day of the balance
    sheet, Any difference between the income statement and the balance sheet can be assumed to come from unrealized losses/earnings.
  - The Treasury got gifted several memecoins, which we currently do not consider sellable, thus valuing them 0.
  - We use the following guiding principles to assign categories:
    - Categories are assigned by where the primary effect of the spending
      will unfold its value. Titles and descriptions are less relevant here
      than the list of actual deliverables.
    - We consider the perspective of the Polkadot ecosystem. Does it affect core technologies or is it application-specific?
    - There are proposals that could belong to multiple categories. We choose the category where the majority of the costs go to.
The report uses a cash accounting (for the most part)
- This means that expenses and income are considered when money changes accounts, not when the actual service is delivered.
- We strive to arrive at accrual accounting, as it is more in line
  with international accounting practices. But we lack the necessary team
  capacity and data from spends and bounties.
- This can create distortions, for example when payments are made that extend over the measurement period, or when transactions (like the Myth swap or the Inter Miami deal) are prepaid but not yet executed (and
  might still fail and get refunded). Another example is the new spend()
  extrinsic, which we account for at the time of referendum execution.
- The current report bases its numbers on the execution date of
  proposals, which can deviate from the time tokens are spent. For past
  reporting, we only represented direct spending from the Treasury and it
  was convenient to represent them on the date of spending.
- Expenses
  - Loans and liquidity provisions are not represented in the income
    statement, as they do not count as expenses per accounting standards.
    They will show up on the balance sheet
  - Bounty creation & bounty refills are also hidden since these are not yet expended but rather become designated assets. Once they are
    spent via child bounties (or in a single instance fully), expenses are
    accounted.
- Refunds: We record income from transfers to the Treasury. These
  transactions are most likely refunds from OpenGov proposers that have
  been overpaid or decided not to deliver. However, tracking the origin of these transactions is out of the scope of this report.
issues
- we can’t track bounty spends if the bounty decides to liquidate to
  fiat to retain value. this leads to a spend being recorded at the time
  of liquidation
- similarly, the Marketing Bounty moved some funds to the Polkadot Community Foundation. Whose are currently not tracked and counted as expenses. We will improve this in future reports.- This report is created by humans and might contain errors. Don’t trust, verify.

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