Oh my word, what is this? A proposal to use Polkadot’s treasury that will actually attract users?

I must be dreaming, is it finally 2035

GIGA // Hydration indeed \ LFG - Send it hard, strong & long. FEW

gogogo

Polka is the 2th eos, the voice of many users outside. Others' understanding of Polka is limited to a few years ago. Is Polka dead? Where is the apps? This is a common question among users. Users are pragmatic and followers of the Matthew Effect, and our scale is still too small.

if we want to support DEFI platform and bring Polkadot to the outside world, we should support the only competitive and capable teams of this mission, the only team that has that skills i can see is Hydration and Bifrost, they are small but full of inspiration and built relentlessly to ship their market-fit products on Polkadot from the beginning. They are the only 2 parachains that adopted Opengov and fully decentralized, not others shitty platfom that received the incentive from treasury but not transparent about how the incentives is used, we should not give DOTs to them anymore. All my DOTs are in vDOT and i voted AYE!

Good day
Thank you for posting this proposal. I guess this is one of the biggest requests ever in Polkadot OpenGov History = 21,300,000$ (4.26$\DOT). Isn`t it? I have a few questions:

0. Can you please provide information regarding all loans and liquidity rewards Polkadot Treasury provided to Hydration in the last 18 months?

1. As a DOT token holder, I would like to understand the expected outcome that the Hydration Team expects in numbers to achieve.

2. That is not the first liquidity reward that the Hydration Team was granted from the Polkadot Treasury. Can you please share how the previous rewards have been used and how they have impacted the Polkadot?

• Number of DOT token holders before, during and after the prev. liquidity rewards campaign?
• Active New Wallet per day, week, month during the prev. liquidity rewards campaign, before and after?
• Can you please share how many wallets received the rewards from prev. liquidity campaign?

3. Given the actual DOT$ price, is this the best time to request 40% of DOT Treasury and sell DOT at this price and use them as a liquidity reward?
4. Can you please tell me what % of HDX Treasury will be used during this massive Liquidity Reward campaign?

This is quite an interesting proposal, but since the requested amount is ~ 40% of the Polkadot Treasury, the DOT token holders should understand the goals in numbers (metrics) set for this campaign and how to judge the outcome afterwards.

Thank you in advance.
Best.

How many times does one have to return to the trough before he's considered a Welfare queen?

a proposal by a team that looks at other projects , a council and influencers not to name any here... but alwasy promoting HDX and critiquing other projects like STELLA, if this be so alos support moonbeam a parachain with high volume , and its prospects... GIGA looks like ponzi that will implode... DEFI in polkadot it is still maturing... there isnt enough volume, or trades for this proposal is just to take advantage of the treasury, totally a NAYE

Rocadro, I came here to post a very similar critique, but you hit on all the concerns I have. I agree completely and for these reasons I have voted Nay.

Hydration is no doubt the most secure, decentralized, and popular DeFi protocol on Polkadot, but if this proposal passes, Polkadot is overly committing to supporting a single DeFi platform. This does not align with the original vision of being the "blockchain of blockchains." It would effectively transform us from a diverse ecosystem into a single-purpose DeFi platform.

The risk of creating a protocol "too big to fail" is real. By concentrating an enormous chunk of our treasury into a single protocol, we're essentially forcing ourselves into a perpetual funding relationship rather than encouraging sustainable models. Even if Hydration executed perfectly (and their track record suggests that they most likely would), we'd be perpetuating an unhealthy ecosystem dynamic.

I would support a reduced funding amount that aligned more with last year's, even though I believe at some point treasury funding should eventually be phased out for all projects, either because they can or cannot sustain themselves. Sustainable growth requires patience and measured support, not massive liquidity injections that inevitably create withdrawal symptoms when they end.

Polkadot's strength is in its parachains' diversity and interoperability, not in becoming just another venue for token speculation through concentrated liquidity mining.

@Rocadro

you do make valid points and i would like to address each one based on my POV.

re point 1 (5x increase in ask relative to previous proposal):
by DOT value, it is indeed a 5x increase. but the market is not a DOT-denominated market. DeFi competition happens in USD terms, not DOT terms. LP campaigns try to draw liquidity from people who generally think in $$. so the logic for this high ask was driven more by "what would give help us push the metrics higher (TVL, accounts, etc.)."

it's actually more of a 2x than a 5x because in that time, DOT went from ~$10 and today it's around $4. when we look at competing ecosystems, they're allocating much larger sums in real terms - like Aptos committing $200M to DeFi for 2025 alone, as mentioned in the proposal.

re point 2 (5M DOT represents 21.7% of the available liquidity in the Treasury):
while valid, this point does not take into consideration that the Treasury is not a static account. it is consistently refilled and depleted overtime. taking 21.7% now does not mean the Treasury won't be able to grow back again. proof is already there in history—Treasury was almost insolvent at some point in 2024 and now we are more healthy.

looking at the Treasury as a static account isn't helpful for making the kind of decisions we need to make. Treasury management should be strategic rather than merely conservative - investing in successful projects that generate ecosystem value and activity could ultimately benefit the Treasury more than holding onto DOT.

also worth noting that this proposal isn't just giving DOT to Hydration - it's investing in liquidity that benefits the entire ecosystem, including the Treasury's own diversification needs (which has already accumulated $37M+ in stablecoins using Hydration).

re point 3 (risk of creating a BIG winner):
i genuinely struggle to see how success for any project on Polkadot would be a bad thing. what Polkadot needs right now is for its DeFi ecosystem to reach critical mass to be competitive with other blockchains. we are more in danger of having no success stories than we are of creating "too successful" projects. having no wins will kill the ecosystem more than making a winner.

incentivizing liquidity creates network effects that benefit all projects in the ecosystem, not just Hydration. we've already seen how previous incentives unlocked new integrations to Polkadot as a whole.
this position is very very weird to consider given exactly where Polkadot is right now. for context, the Treasury has supported many protocols so far (Hyperbridge, Bifrost, Stellaswap, and a lot more).

Hydration has come back simply because they were successful in their first foray. the ecosystem agrees. the numbers prove it. in traditional management, you give more to those who have performed really well in the past. it makes little sense to stop the growth or success of a project simply cos we are afraid of what major success will be like.

conclusion
finally, i want to emphasize that these incentives are meant to bootstrap self-sustaining liquidity, not as permanent subsidies. each of the three buckets (stablecoins, LP, GIGADOT) serves a different strategic purpose for the ecosystem, not just for Hydration as a project.

full disclosure: i work with Hydration, which gives me firsthand insight into these matters, though these opinions are my own and not an official Hydration response.

JAM Implementers DAO votes NAY on this proposal. Reasoning is as follows.

💰 Size and Risk Concerns
The amount requested was considered excessive relative to Hydration’s current size (~$45M TVL).

Treasury would be exposed to high systemic risk, especially due to:

Use of complex yield instruments like GIGADOT

Potential vulnerabilities similar to Acala USD's historical depegging

Liquidity risks from converting DOT into vDOT with unstaking delays

🧾 Sustainability and Governance
Hydration’s growth is seen as inorganic, heavily driven by treasury incentives, not real user adoption.

Critics pointed out that much of Hydration's current TVL comes from previous treasury-funded incentives, not community deposits.

Concerns were raised about Hydration governance potentially overriding OpenGov oversight post-funding, especially excluding DOT holders without HDX tokens.

🪙 Fairness and Precedent
Multiple voters felt Hydration has already received enough support and is beyond common good funding levels.

Some suggested Hydration should reprioritize or reframe the proposal at a lower amount.

There was a strong desire for enterprise-level insurance or collateral to back any large treasury loan.

🧪 Comparative Logic
While Hydration is bringing TVL to Polkadot, it's argued that Asset Hub would be a more suitable recipient for such a large investment.

Comparisons were made to celebrity-led investments, expressing skepticism over hype-driven funding without accountability.

I'm truly impressed by the work Hydration is doing — it's clear the team deeply understands DeFi infrastructure and is building powerful tools to serve the Polkadot ecosystem. The integration of swaps, lending, and a native stablecoin in a unified UX is both ambitious and necessary.

That said, as someone who may not be fully technical but values sustainability, I do believe it's important to consider a path toward long-term protocol self-sufficiency. The Polkadot Treasury has already supported Hydration significantly — and rightfully so, given its contribution to TVL growth and user adoption.

However, for the health of the ecosystem and the Treasury’s own sustainability, it would be great to see future incentive proposals include a clear roadmap toward gradual revenue generation or fee recirculation models, so that Hydration (and similar protocols) can eventually support themselves without continuous external subsidies.

This would strengthen the signal that Polkadot-native DeFi can grow sustainably — not just through grants, but through real, robust economic design. 💧🌀

Much respect for the work done so far — looking forward to what comes next.

Important question: Will any of these 5m DOT (or staking rewards thereof) be used for subsequent voting in opengov or delegated to ChaosDAO? I would like to get a YES/NO answer to this questions from proposer @lolmcshizz .

Suffice to say that I believe if they intend to use these DOT for voting, this proposal should absolutely be NAYed. So I invite the proposer to pledge here in this public forum that these DOT won't also be used for this purpose.

While I generally agree with the sentiment that 5m is a big chunk of the treasury, we also need to accept the reality. Others are spending much more. The mentioned 180m are only what is publicly visible and we don't know what is done behind closed doors.

For long enough the treasury and everything tried to stay neutral. Don't pick any winners. We clearly have seen that this didn't paid out. For people who are working in the ecosystem since 6 years, we can clearly assume that they are here because they want that we all succeed and not just to grift.

Hydration is also at the front when it is about UX improvements etc. There is still work to be done, but they are clearly delivering one, if not the, best experiences in the ecosystem. All that is very important to attract new users, in the best case people that have no idea about crypto. For these people the interface needs to be as easy as possible. They are on the way to achieve this.

I have no idea how the incentives are paid out or how it is calculated how much to pay out per day etc. However, I agree that trying to increase the runway of these incentives would be nice. It would also be nice if Hydration Treasury in return would offer some Hdx to Polkadot. So, Polkadot not only wins with the potential token price increase, but also by getting something in exchange. Someone could even argue to lend these hdx tokens and borrow some stables to pay for future proposals.

All in all, I'm aye.

As someone who deeply respects Hydration's contributions to Polkadot and believes they have built one of the most technically capable and community-responsive teams in the ecosystem, this was not an easy vote.

But I voted NAY on Referendum #1542 not because I doubt the team’s good intentions or the quality of their work, but because the economic model it represents raises larger concerns for Polkadot’s long-term sustainability and direction.

Crypto is slowly waking up from a foundational misdiagnosis: the belief that value would naturally flow upward from generalized “Web3 applications” into the infrastructure layer, and that blockchains would flourish by subsidizing financialized activity across every use case.

Liquidity mining is not a substitute for adoption. It is a subsidy, and like all subsidies, it should be wielded with surgical precision and clear exit strategies not as a default economic engine for an ecosystem. Hydration's previous 1M DOT campaign helped bootstrap initial traction. But a 5M DOT ask nearly a quarter of the Treasury’s free liquidity clearly shifts us from support to dependency.

🏛
Approving this request would set a precedent: that the Treasury’s role is not to catalyze sustainable infrastructure, but to act as a DeFi yield funder of last resort. And because Hydration is the only team with the capability and track record to make this kind of proposal, it also centralizes ecosystem risk. This undermines both Polkadot's heterogeneity thesis and the ethos of decentralized, competitive experimentation.

Even if this proposal “succeeds” by some metrics TVL, trading volume, or XCM transfers we must ask: at what cost, and for how long? What happens when the incentives stop? What signal are we sending to future teams about what success on Polkadot looks like: building products people use, or building grant narratives that drain public funds?

💸 On Money and the Purpose of Crypto
Polkadot doesn’t need to emulate Aptos or Arbitrum’s $200M DeFi subsidy rounds. We were meant to build something better not Web3 as a buzzword for tokenizing everything, but governance and infrastructure for trust-minimized, sovereign digital systems. And money programmable, permissionless, credible money was always at the center of that vision.

Hydration’s GIGADOT is an elegant product, but we must be clear-eyed about what it is: a leveraged yield product funded by public capital, riding on the assumption that more incentives = more usage = more legitimacy. But real money doesn’t need a marketing budget. It earns trust because it serves a purpose. We should not sacrifice 5M DOT trying to simulate that.

✅ What Should We Support Instead
I would support a staged, milestone-based approach — with transparent metrics, a clear sunset date, and ideally a path to protocol revenue or partial repayment. I would support Treasury allocations that create public goods — bridges, SDK improvements, safety tooling, new primitives — not primarily liquidity emissions for financial products with unclear long-term stickiness.

This proposal asks the Treasury to fund growth. But growth without durability is just burn.

🌱 Final Thought
The next chapter of Polkadot must not be about building the loudest application layer. It must be about reconnecting with crypto’s original insight: that we can build digital systems where sovereignty, coordination, and money don’t require intermediaries.

That’s the harder path. But it’s the one worth funding.

I support Hydration in receiving funding, but shouldn’t Hydration also allocate some HDX tokens to the Polkadot treasury in return—say, 200 million HDX? That way, it can truly demonstrate that the success of HDX equals the success of DOT.

The Governance is broken.

As we all know, Open Gov represents one of the most innovative, live, flexible, and compelling tools of governance and the most tech-savvy protocol in crypto right now. No other protocol has even arrived close to Open Gov yet.

But..There is something that is not working.

Polkadot Treasury holds different assets

• DOT≈ 12.71M
• AssetHub ≈ 4.31M
  https://polkadot.dotreasury.com/#/
  

The ref 1542 ( https://polkadot.subsquare.io/referenda/1542#7 = Treasurer track ) represents one of the biggest treasuries requested in the history of Polkadot => Represents request of 29.4% (or 39.4% without assethub) of DOTs available in the Treasury right now!

5,000,000 DOTs requested or 20,000,000$ as a rewards. That means that rewards will be given without return. Yes. You got it well.

Taking into consideration the strong and mature @Polkadot governance, I was expecting to see strong discussion, concerns, critical questions, sort of negotiation not only from all token holders, but most of all from DVs, who received the DELEGATION from Web3Foundation . I`m not even talking about starting an RFC first..But at the end you will understand why RFC is not necessary here.

But.. I was wrong. Completely wrong. Literally nothing.

The Governance is broken.

Since I posted a question under the referendum and reposted my questions on X, it has been 7 days without any reply. Weird right? Usually, the authors of proposals are trying to get the maximum attention and reply to all questions. But maybe just my questions are not so good? Let us check:

0. Six days the God took to create a Universe. Six days...
Seven days have passed since the proposal was submitted, and seven days have passed since the questions were asked without getting a single (ZERO) answer from the proposal's author. Not a single one received a reply. Not a SINGLE author of questions in SEVEN days received A SINGLE REPLY. None of them.
But there was plenty of time for X yappers, videos and other stuff. Hm..

1. One DVs voted NAY and one DVs voted AYE without even asking ANY of the questions regarding the biggest proposal ever. Just WOW.

2. Two, as twenty million dollars requested or as 200 aDOT token holders who will receive (partially) the rewards! ( https://hydration.subscan.io/custom_token_holders?page=8&page_size=25&unique_id=asset_registry/026fadfabedc8fb74b6541384357664505c7ce45 )
You get it well, less than 200 adot token holders will split the rewards right now (Balance =>1 aDOT).

3. Three. As a 3X% of the DOTs requested. But who are the beneficiaries of these rewards?

vDOT hydration:

• 1719 token holders ( 814 with the balance =>1 vDOT) https://hydration.subscan.io/custom_token_holders?page=17&page_size=50&unique_id=asset_registry/37444e63907d968b4a4947cb38ce9c019e6b6310

GigaDot :

• 509 token holders ( https://hydration.subscan.io/custom_token?unique_id=asset_registry%2Fab3282c5b2298f24787ff0112b7beb29be7332d0 )

USDC hydration:

• 524 token holders https://hydration.subscan.io/custom_token?unique_id=asset_registry%2F27c14d3d220f5752fa497dd4ff04f8db950fcf9b

USDT hydration:

• 562 token holders https://hydration.subscan.io/custom_token?unique_id=asset_registry%2F1bb85661d74e2a15ba3b959218f3c3f93c7ddb88&tab=holders

The numbers are not so juicy. But maybe this is because we are looking from the wrong perspective? The data are available onchain. Take a look. Don't be surprised.

DOT Holders: 1,471,105 should finance 500-1000, and let it be even 5000 users with the clear burning rewards incentive?

The DOTs price is so strong that we can give 3X% of the available DOTs for the liquidity rewards without any clear goals?

4. Four, as four different liquidity rewards requested, without any clear measurable goal, DECLARED that they will be achieved with this proposal.
Literally zero information about ANY numbers, Goals, metrics, or what is aiming to achieve with this proposal. How should this proposal be evaluated after?
How can we understand if this spending was successful or not yet?
5. Five, as 14DN...qbX5 wallet (any thoughts who is the owner) Shadow Gov or Gavin W
(just asking), who pushed the proposal with a single vote with 18.21M DOT into the seven heavens.

Before casting the vote, if something is unclear, you should always ask questions. Try to clarify unclear points, find a trade-off.

0 interaction, 0 reply token holders, 0 reply to DVs, 0 comments on AAG show about the concerns regarding this proposal. It looks like that deal was already approved even before submitting it onchain.

But at the end of the day...if the DVs are not even asking questions (that they should) and if nobody is replying (they should)... The deal was already agreed.

This way of "approving" the proposals is the way into ⛔️⛔️⛔️

Well. The governance is broken.

P.S. I do believe that Hydration is one of the few successful parachains on Polkadot (as I always mentioned this), but that doesn't mean that 20,000,000$ should be given in one go without clear goals and with the kind of "approval" like this.

IPFS: https://teal-wispy-crow-369.mypinata.cloud/ipfs/bafybeid7335ull5cspijjs5yrr5kpcnwnhl6ph7ixdivcp4cr3zwjhvfui

no answers yet?

While the GIGAHydration Campaign aims to boost DeFi with a 5M DOT grant, I vote Nay due to critical concerns:

Treasury Draw: 5M DOT (~21-25% of liquid funds) strains resources for other ecosystem needs.

Sustainability: High-yield incentives may attract temporary liquidity, but without lasting adoption,
users could sell rewarded DOT, increasing sell pressure and depressing prices for the next 12 months.

Hydration Dependency: Over-reliance on one protocol increases systemic risk.

Market Risks: Stablecoin and DeFi growth are uncertain amid regulatory and market
challenges.

A smaller, diversified approach would better serve Polkadot.

What happens when incentives end? How do you sustain growth after that?

PolkaWorld voted NAY in the first round, but would like to raise the following questions for further discussion:

1. While we acknowledge that Hydration is currently gaining strong momentum within the Polkadot ecosystem, does this necessarily mean that every fast-growing rollup should rely on Treasury funding to drive its user growth?

2. This brings us to a broader concern: the requested 5 million DOT accounts for around 30% of the Treasury’s current holdings. As a community, we believe it’s important to clarify whether incentive programs are such a top priority for the Polkadot ecosystem at this stage. (From our conversations with other contributors, some feel that initiatives around Polkadot Hub may currently be more urgent.) Additionally, is this the right timing for such incentives, given current market conditions and the fact that Polkadot Hub has yet to launch?

3. Regarding success metrics, the proposal lists TVL, volume, and supply — but does not outline specific targets. This gives the impression that outcomes are left somewhat to chance. For a Treasury whose role is to safeguard the ecosystem’s long-term sustainability, committing 30% of its DOT to an initiative without clear goals may feel overly casual.

4. Given the expected increase in trading activity from this program, has there been any consideration of using the resulting fees or revenue to give back to the Treasury?

We’ll continue to follow this proposal closely.