- Polkadot proposes converting 500,000 DOT into Bitcoin via tBTC for treasury diversification.
- Community debates plan amid DOT price slump and delayed SEC decision on Polkadot ETF.
Polkadot [DOT] is considering a bold shift in its treasury strategy by proposing a conversion of 500,000 DOT tokens into Threshold Bitcoin (tBTC), a Bitcoin-backed ERC-20 token.
The initiative, which seeks to diversify the network’s holdings through Hydration’s “rolling DCA” method over the next year, has sparked a wave of discussion within the community.
While some support the move as a hedge against market volatility and a step toward long-term stability, others question the timing, particularly with Bitcoin [BTC] trading near its all-time highs.
Polkadot’s Bitcoin Reserve plan
In early June, a member of the Polkadot community, known as “hippiestank,” introduced a proposal to establish a Bitcoin Reserve.
The conversion, set to take place over the course of a year, would be achieved by gradually converting 500,000 DOT tokens into BTC.
The plan involves employing a dollar-cost averaging (DCA) approach and leveraging Threshold BTC (tBTC) to gain exposure to BTC.
However, DOT has experienced a disappointing performance in 2025, with the token dropping nearly 60% year-to-date.
Inasmuch, many members of the community have expressed support for the proposal. They view it as a potential solution to stabilize the network’s financial situation.
For instance, one community member said,
“I believe the ‘DOT ATL, BTC ATH’ argument misframes the situation. This proposal is about risk management and operational continuity, not market timing or speculation”.
Defending the proposal, the initiator argued that waiting for the “perfect” moment to buy Bitcoin could lead to missed opportunities and stall Polkadot’s diversification strategy entirely.
Mixed community reaction
However, the plan hasn’t convinced everyone.
Some community members remain unconvinced of its long-term benefits, expressing doubts about its actual value to the ecosystem.
“If we want a resilient Treasury then we would diversify into different asset classes. Not sell one highly volatile asset for another.”
However, despite the divided opinion, the community’s consensus will be key in determining whether this diversification plan moves ahead.
Source: X
At press time, DOT was trading at $3.82, reflecting a 6.10% decline over the past 24 hours, according to CoinMarketCap.
