Polkadot Development Strategy Report: How to Break Through Current Dilemmas?

Introduction

Hello everyone who cares about Polkadot. We are the Polkadot Ecological Research Institute, a team focused on researching Polkadot and its ecological development opportunities, and we have received support from the Polkadot treasury for six consecutive times.

As a team that has been researching Polkadot for nearly five years, we have noticed an increasing voice of disappointment within the community regarding Polkadot. However, with the launch of OpenGov for Polkadot, we see an opportunity to become a driving force for the development of Polkadot. Therefore, we have shifted from passive research to active participation, presenting this Polkadot Growth Strategy Planning Report, addressing the most genuine issues and proposing improvement ideas.

This article is based on our years of research and will comprehensively address multiple issues faced by Polkadot from a global perspective. We welcome everyone to provide suggestions on any shortcomings of this article, and work together to make Polkadot better.

The Current Status of Polkadot

In the past six months, Polkadot has made significant progress, achieving two important milestones: the launch of OpenGov introduced an advanced governance model, and the release of XCM V3 improved the messaging format. Polkadot's infrastructure remains strong, and developer activity has significantly increased.

However, Polkadot still faces some difficulties. The price of DOT is unstable, user activity is declining, the development of ecological projects is sluggish, and there are issues with treasury governance. Overall, while Polkadot continues to innovate, it also faces many challenges.

Technical Update Status

Polkadot achieved two important technical updates in the first half of this year:

• OpenGov: A new governance model that achieves decentralization through community voting.
• XCM V3: The latest version of the cross-consensus message format, supporting features such as external network bridging.

Polkadot 1.0 has been fully delivered, and the vision for 2.0 proposes several new concepts and technologies:

• Accord( Agreement): A voluntary treaty across multiple chains
• SPREE Technology: Runtime Logic Fragment Based on Relay Chain
• Project CAPI: Promoting the development of DApps based on Polkadot

Polkadot 2.0 reaffirms the creation of a resilient application platform, which will invest in ZK technology, Hermit Relay, and several other technological updates.

On-chain situation

According to the Messari Q2 report:

• Development activities continue to rise, with a relatively stable number of core developers.
• Daily active accounts decreased from 6,290 to 5,810
• Income decreased from $120,000 to $81,000
• The TVL of parallel chains has decreased after an increase, falling from a peak of $236 million to $147 million.
• The staking rate of DOT is 46%, with a current return rate of about 9%.

Developer Situation

Electric Capital data shows that Polkadot has a large developer base:

• 645 full-time developers, ranked second
• The total number of developers is 1923, rising from third to second.
• Full-time developers account for 33.54% of the total.

This indicates that the Polkadot developer community is continuously expanding and plays an important role in the development of the ecosystem.

ecological situation

The Polkadot ecosystem is developing rapidly and diversifying:

• PolkaProject statistics show there are 580 related applications.
• XCM V3 has attracted widespread attention.
• The TVL of parallel chains such as Moonbeam and Acala remains at a high level.
• Slot auction allocation relay chain access rights
• Multiple ecological projects have made progress, such as Mythical Games, Kilt, and others.

Overall, the Polkadot ecosystem is continuously growing, and the Roadmap is progressing smoothly.

market capitalization

As of October 11:

• The market value of Polkadot is approximately 3.375 billion USD, ranking 14.
• Has shown a downward trend in recent months, with prices dropping by 31.87%
• The market value of Cosmos is approximately $2.598 billion, and ATOM has fallen by 27.42% this year.
• The market value of Optimism is about 1 billion USD, with an increase of 227% since the beginning of the year.
• Arbitrum market capitalization is 1 billion US dollars

social media situation

Official Polkadot media includes:

• Official website: provides detailed project information
• Twitter, Reddit, etc.: Post the latest updates
• YouTube: provides videos for speeches, technical sharing, etc.
• Forums, GitHub, etc.: Discuss technology and the future
• Knowledge Base Support: Provides tutorial support

Social media is relatively rich, providing users with various ways to engage in communication.

National Treasury Governance Situation

OpenGov faces some challenges:

• The difference in voting rates is significant, with lower voting rates related to treasury expenditure tracks.
• The treasury balance has decreased, and the rate of expenditure has明显增加.
• The pass rate is relatively low, averaging between 1.44% and 3.33%.

Improving governance systems, maintaining ecological development, and addressing issues such as low voter turnout are particularly critical.

Issues Facing Polkadot

Economic model issues

• The inflation rate is relatively high at approximately 7.38%
• The use cases for DOT are relatively few.
• Concerns about the value of tokens

( Operational Issues

• On-chain data performance is poor: user activity, financial status, and other indicators are weak.
• Social media data performance is poor: discussion heat and topic activity are low.
• Lack of data presentation: There is a lack of comprehensive websites showcasing the ecosystem's situation.

) User threshold issue

• High difficulty: complex operations, requiring technical knowledge
• High learning difficulty: the ecosystem is complex, and the documentation is highly specialized.
• Fragmentation of information transmission: New developments are not communicated in a timely manner, and promotional materials are overly specialized.

Treasury governance issues

• Low voter turnout
• Game Theory Attack Risk
• Non-representative ### whale impact ### issue

SWOT Analysis of Polkadot

( 优势)Strengths###

• Technological Innovation: such as OpenGov, XCM V3, etc.
• Strong developer base
• Rich multi-chain ecosystem

( 劣势)Weaknesses###

• The token price did not meet expectations.
• The user threshold is too high
• The DeFi ecosystem is not mature.

( 机会)Opportunities###

• Increase user engagement
• Innovative concepts and technologies
• Utilize sufficient reserve funds

( 威胁)Threats###

• Treasury Governance Challenges
• Competitive pressure
• The market outlook is not optimistic.

Macroscopic Analysis of Polkadot's Situation from Two Perspectives

( Endgame Perspective

• Full-chain map: Different public chains/Layer 2 are interconnected through cross-chain solutions.
• Polkadot Role: The multi-chain ecosystem with the highest internal security coefficient
• Advantages: The security is the same between parallel chains, suitable for on-chain collaboration of实体企业.

) periodic angle

• Macroeconomic environment cycle: affects capital inflow
• Public chain development cycle: Polkadot is in the initial stage and needs to act accordingly.

![Ten Thousand Character Strategic Report: Token Application Scenarios are Scarce, Data Indicators Growth is Stagnant, How Can Polkadot Break the Deadlock?]###https://img-cdn.gateio.im/webp-social/moments-b4d30b765efb3d2745645bcb1f58aa0f.webp###

What innovations have occurred in the development of public chains in recent years?

( Ecological Empowerment + Public Chain Incentives

• Polygon, Avalanche and others adopt DeFi incentive programs.
• Attracting funds, TVL is rapidly growing

) Exchange Empowerment + Ecological Empowerment

• BNBChain and Solana received exchange support
• Form a virtuous cycle and promote ecological development

Empowerment of Incorrect Cases

• Projects like NBA Top Shot on the Flow blockchain are underperforming.
• Reason: Users are not Web3 native, the project has not formed a connection with FLOW, and it lacks a DeFi ecosystem.

![Ten Thousand Character Strategic Report: Token Application Scenarios are Scarce, Data Indicators are Stagnant, How Should Polkadot Break Through?]###https://img-cdn.gateio.im/webp-social/moments-b26aecea79a33718530d2b246fab7ae7.webp###

What is the growth logic of public chains?

( Transition of Public Chain Token Nature

• Transitioning from simple gas fees to DeFi underlying assets
• Similar to gold transforming from an industrial raw material to a financial asset

) Token Appreciation Logic

• The project management is linked to the token usage scenarios.
• Buyer demand exceeds seller supply
• Promote jointly at the operational and trading levels

Public chain ecosystem promotes development

• DeFi projects are most beneficial for the development of public chains.
• Can lock the public chain token, providing capital leverage

The reason Polkadot failed to develop during the bull market

• Poor timing: The ecosystem encountered a bear market right at its inception.
• DOT has not undergone a change in nature, and its financial value has not been fully realized.

![Ten Thousand Words Strategy Report: How does Polkadot break the deadlock with a lack of token application scenarios and stagnation in data indicator growth?]###https://img-cdn.gateio.im/webp-social/moments-2aa4f5f4c3f6e3ae62b38bc1a3101394.webp###

How can Polkadot break through in the current market?

( Overall thinking

• Gather the power of governance
• Collaborative development of official and decentralized governance
• Develop a Roadmap for Treasury Governance

) Emphasize the balance between price and development

• Respect the SEC consensus, but unofficially pay attention to the value of DOT.
• DOT price is an important indicator of ecological confidence.

Strategic positioning and goals

• Multi-core computers from a full-chain perspective
• Core Objective: Growth
• Maintain stability + Build attractiveness

solutions or ideas

1. Polkadot's "governance framework"
2. Ten Strategic Objectives of Polkadot Treasury Governance
3. Three areas for improvement
4. Possible objections in the plan

![Ten Thousand Character Strategic Report: Token Application Scenarios are Scarce, Data Indicators are Stagnant, How Should Polkadot Break the Situation?]###https://img-cdn.gateio.im/webp-social/moments-b459ef5effb46f274c852d4a0a875c2b.webp###

Postscript

Although Polkadot has achieved certain accomplishments, its development path remains challenging. We hope to explore new possibilities starting from the spirit of Web3. Thank you for your attention, and let's work together for the future of Polkadot.

"Pessimists are always right, optimists are always moving forward"