100% agree. Polkadot should support its native defi protocol like Hydration more and more

This is definitely a win-win situation.

Solana, a famous downtime chain, has recently won win thoroughly in the market.

I can see that our technology is constantly breaking through, while the threshold is also decreasing. There has been some improvement in marketing, take a look at the TPS event on our Twitter. But for ordinary users, Polkadot's technology needs to be applied to showcase, and the application needs scale to attract and serve users.

Let's refine and discuss this proposal, and then accelerate its passage.

I believe that in 2025, we will have more similar win-win proposals passed, and this is just the beginning. I am looking forward to it.


I was going to ask what happens if all of the DOT is borrowed and then can't be sold, but I opened the full proposal and saw that it uses aDOT to solve that problem. Great example of using available ecosystem tools, bullish.

And with that action, OpenGov will have more diversity in DeFi activity than the EF in all these years. 

Kidding aside, it's a sound strategy. Just one matter,  has it been considered to split the acquisition of aDOT from DOT (step 2) into two, three or four events instead of just one big event through router.sellAll? This would generate less yield for the treasury and less liquidity on Hydration of course but it's an insurance against the event of an aDOT depeg. Not wanting or wishing for that to happen of course but it's a possibility that all DeFi users have to consider. The same goes for all the other risks associated with DeFi.
t. Euler survivors.

[@Saxemberg Governance](/user/11fx8xKPNd4zVSBxkpN8qhhaGEmNJvPgKqwhDATZQXs7dkM) Hi Sax!

The swaps will not actually be subject to slippage as we will be implementing supplying and withdrawing from our Supply & Borrow feature directly into the router - so what this means is that the sellAll will in fact be supplying the DOT into the Borrow market in exchange for the equivalent amount of aDOT, as opposed to a typical swap between two tokens.

Another good ecosystem showcase. More capital efficiency, utilization, DeFi growth.

**Requested Amount:** 0 DOT

**Date (discussion):** 20-01-25

**Short Description:** [Ref #1104](https://polkadot.subsquare.io/referenda/1104) created a long-running DCA schedule on Hydration on behalf of the Polkadot Treasury to accumulate USDT and USDC using DOT. Currently, the DCA holds ~3,700,000 DOT which is sitting on Hydration and waiting to be swapped. This proposal aims to increase the capital-efficiency for the Treasury and for DeFi users by supplying the open amount as collateral to the Borrow feature on Hydration, and selling that collateral over time to continue executing the DCA schedule. By doing so, the Polkadot Treasury will accumulate yield on the dormant DOT, while substantially increasing the DOT supply available for borrowing, thus enabling more DeFi use cases.

**Please read the full proposal [here](https://docs.google.com/document/d/1ypnfhM6xDVqZXJimbDd0IIqe4ObRUtQ0f1OVIezR8DE/edit?usp=sharing).**

## Context
The Polkadot Treasury has decided in [Ref #1104](https://polkadot.subsquare.io/referenda/1104) to accumulate USDT and USDC stablecoins by transferring 5,256,001 DOT to Hydration and placing a long-running DCA order which performs the swaps over time. This is not the first time it has done so - previously, [Ref. #457](https://polkadot.subsquare.io/referenda/457) DCA’ed 3,405,000 DOT into USDT and USDC over ~11 months.

At the time of writing, there is ~3,700,000 DOT remaining in the running DCA schedules (it can be checked [here](https://hydration.subscan.io/account/7KCp4eenFS4CowF9SpQE5BBCj5MtoBA3K811tNyRmhLfH1aV)). At the time of writing, the schedules are expected to continue for another ~260 days. This DOT is just sitting there, waiting to be swapped. Instead of letting it stay idle, the Treasury could utilize these assets by supplying it as collateral to Hydration’s Borrow feature. As Hydration allows using collateral to execute a DCA schedule, the accumulation of USDT and USDC can continue uninterrupted, as planned in the original proposal.

## Impact
Supplying the idle DOT as collateral on Hydration will have three major benefits.

In the first place, it will improve the capital-efficiency of the Treasury DCA. After being supplied as collateral, the DOT will start accumulating a yield which is determined by the demand for this asset on the borrowing market. Using that yield, the Treasury will be able to accumulate more USDT and USDC.

In the second place, this proposal will give a boost to the native DeFi ecosystem by increasing the DOT available for borrowing on Hydration. With a current utilization rate of 40%, the community is showing strong interest in borrowing DOT which can be used for various interesting DeFi strategies.

Finally, the proposal will help grow some important DeFi metrics, while showcasing some strong use cases of Polkadot (cross-chain transfers, governance, trustless swaps).


- **Requested Amount:** 0 DOT  
- **Date (discussion):** January 25, 2020  
- **Description:** A proposal to use 3,700,000 DOT from the Polkadot Treasury as collateral on Hydration to earn yield and continue a DCA (Dollar-Cost Averaging) schedule for USDT and USDC.  
- **Context:** The Treasury previously moved DOT to Hydration for DCA swaps. Currently, 3,700,000 DOT is idle and waiting to be swapped over ~260 days.  
- **Impact:**  
  - Earn yield on idle DOT, increasing Treasury efficiency.  
  - Boost DeFi by making more DOT available for borrowing.  
  - Grow DeFi metrics and showcase Polkadot's capabilities.

Supply Idle DOT on Hydration as Yield-Bearing Collateral

Context

Impact