Treasury Proposal | June 2026
Proposer: Tyrone - Bifrost
Bifrost successfully completed its first year of the 1M DOT liquidity loan (Referendum #1538). Over the 12-month period from May 2025 to May 2026, the 1,000,000 DOT loan generated 53,185.39 DOT in interest (blended APR: 5.318%), and Bifrost distributed an additional 68,173 BNC (~$6,335) in liquidity incentives to the vDOT-DOT pool — on top of 187,173 BNC distributed in the three preceding years.
Bifrost now proposes to:
| Item | Value | Notes |
|---|---|---|
| Principal | ||
| Total loan amount | 1,000,000 DOT | |
| Liquidity Pool Deployment | ||
| Minted as vDOT and deployed as liquidity | 672,469.39 DOT | 67.25% in pool — generates staking yield |
| Deployed as liquidit | 327,455.47 DOT | 32.75% in pool — does not generate staking yield |
| Returns (May 2025 – May 2026) | ||
| Total interest earned | 53,185.3937 DOT | |
| Blended APR | 5.318% |
A total of 1,000,000 DOT was borrowed and deployed in vDOT/DOT liquidity: 672,469.39 DOT (67.25%) was minted into vDOT, while the remaining 327,455.47 DOT (32.75%) deployed in stable pool against vDOT. After one year, the position generated 53,185.39 DOT in total interest, reflecting a blended APR of 5.318%.
| Item | Value | Value in USD |
|---|---|---|
| Liquidity Incentives (BNC) | ||
| Total BNC rewarded (2025–2026) | 68,173 BNC | ~$6,335 based on 1-yr avg. price |
| Total BNC rewarded (2023–2026) | 255,346.16 BNC | ~$33,195 based on 4-yr avg. price |
Over the past four years, Bifrost has distributed a total of 255,346.16 BNC (~$33,195) in liquidity incentives to the vDOT-DOT pool — demonstrating consistent, long-term commitment to DOT liquid staking. Of this, 68,173 BNC (~$6,335) was rewarded in 2025–2026 alone, with the remaining ~187,173 BNC distributed across the three preceding years, reflecting Bifrost's role as a sustained contributor to the DOT LST ecosystem well before recent market cycles.
Bifrost commits to repaying the Year 1 interest in full to the Polkadot Treasury by June 26th to the activation of the Year 2 loan.
| Item | Value | Notes |
|---|---|---|
| Principal | 1,000,000 DOT | Propose to roll into Year 2 loan |
| Interest | 53,185.3937 DOT | Paid to Treasury by June 26th |
The 53,185.3937 DOT interest will be transferred directly to the Polkadot Treasury.
| Parameter | Year 2 Terms | Notes |
|---|---|---|
| Loan amount | 1,000,000 DOT | Renewal of existing loan |
| Loan duration | 12 months from enactment | |
| Blended interest rate | ~3% | Contingent on DOT staking APY ~5% |
| vDOT allocation | ~60% of principal | ~600,000 DOT minted as vDOT |
| Liquidity allocation | ~40% of principal | ~400,000 DOT deployed to vDOT-DOT pool |
| Repayment | Principal (1,000,000 DOT) + accrued interest | Full repayment at end of term |
The blended interest rate for Year 2 is projected at approximately 3% and Bifrost will NOT take any commissions from it. This rate is lower than Year 1 (5.318%) due to the adjustments of DOT inflation, validator commission and decreasing of staking reward.
Beyond liquidity and yield, vDOT now carries full Polkadot OpenGov participation rights. This section introduces two complementary governance features that increase vDOT's utility and strengthen its role within the Polkadot ecosystem.
Note on Loan-Derived vDOT: The ~600,000 vDOT minted under this Year 2 loan will be deployed into the vDOT-DOT liquidity pool and held under Bifrost Treasury custody. This vDOT does not participate in the delegated voting mechanism described in Section 5.2 — it is excluded from Polkadot OpenGov voting entirely (neither voted directly by Bifrost nor delegated under BNC governance), avoiding any appearance of loan-derived capital being used to influence on-chain governance outcomes.
vDOT holders can participate directly in Polkadot on-chain governance. Since the DOT underlying vDOT is staked via Bifrost's sovereign address and its derived keyless addresses on Polkadot, these addresses carry full governance voting rights. Through the Bifrost DApp, vDOT holders can:
This means vDOT holders do not sacrifice governance rights when liquid-staking DOT — a key differentiator for DOT LSTs.
Bifrost introduces a new governance layer: BNC holders can direct the voting rights of vDOT that has been delegated to Bifrost but whose holders have not cast a vote themselves.
Specifically:
This feature meaningfully increases Polkadot governance participation and gives BNC holders a direct stake in the direction of the Polkadot ecosystem — creating a deeper, more organic alignment between Bifrost and Polkadot governance.
Reference: docs.bifrost.io/faq/what-is-lst-governance
Kusama
Bifrost has brought a total income of 8,370.5523 KSM to the Kusama Treasury.
Polkadot
Bifrost borrowed 1,000,000 DOT from the Polkadot Treasury. In one year, they earned 53,185 DOT in interest. They will repay that interest by June 26th.
They want to borrow the same amount again for one more year. This time, the interest rate will be lower, around 3%.
Bifrost rewards people who provide liquidity with their own token BNC. They have done this for four years.
People who hold vDOT can now vote in Polkadot decisions. If they don't vote, Bifrost token holders (BNC) can vote for them. Loan vDOT is not used for voting.
Treasury Proposal | June 2026
Proposer: Tyrone - Bifrost
Bifrost successfully completed its first year of the 1M DOT liquidity loan (Referendum #1538). Over the 12-month period from May 2025 to May 2026, the 1,000,000 DOT loan generated 53,185.39 DOT in interest (blended APR: 5.318%), and Bifrost distributed an additional 68,173 BNC (~$6,335) in liquidity incentives to the vDOT-DOT pool — on top of 187,173 BNC distributed in the three preceding years.
Bifrost now proposes to:
| Item | Value | Notes |
|---|---|---|
| Principal | ||
| Total loan amount | 1,000,000 DOT | |
| Liquidity Pool Deployment | ||
| Minted as vDOT and deployed as liquidity | 672,469.39 DOT | 67.25% in pool — generates staking yield |
| Deployed as liquidit | 327,455.47 DOT | 32.75% in pool — does not generate staking yield |
| Returns (May 2025 – May 2026) | ||
| Total interest earned | 53,185.3937 DOT | |
| Blended APR | 5.318% |
A total of 1,000,000 DOT was borrowed and deployed in vDOT/DOT liquidity: 672,469.39 DOT (67.25%) was minted into vDOT, while the remaining 327,455.47 DOT (32.75%) deployed in stable pool against vDOT. After one year, the position generated 53,185.39 DOT in total interest, reflecting a blended APR of 5.318%.
| Item | Value | Value in USD |
|---|---|---|
| Liquidity Incentives (BNC) | ||
| Total BNC rewarded (2025–2026) | 68,173 BNC | ~$6,335 based on 1-yr avg. price |
| Total BNC rewarded (2023–2026) | 255,346.16 BNC | ~$33,195 based on 4-yr avg. price |
Over the past four years, Bifrost has distributed a total of 255,346.16 BNC (~$33,195) in liquidity incentives to the vDOT-DOT pool — demonstrating consistent, long-term commitment to DOT liquid staking. Of this, 68,173 BNC (~$6,335) was rewarded in 2025–2026 alone, with the remaining ~187,173 BNC distributed across the three preceding years, reflecting Bifrost's role as a sustained contributor to the DOT LST ecosystem well before recent market cycles.
Bifrost commits to repaying the Year 1 interest in full to the Polkadot Treasury by June 26th to the activation of the Year 2 loan.
| Item | Value | Notes |
|---|---|---|
| Principal | 1,000,000 DOT | Propose to roll into Year 2 loan |
| Interest | 53,185.3937 DOT | Paid to Treasury by June 26th |
The 53,185.3937 DOT interest will be transferred directly to the Polkadot Treasury.
| Parameter | Year 2 Terms | Notes |
|---|---|---|
| Loan amount | 1,000,000 DOT | Renewal of existing loan |
| Loan duration | 12 months from enactment | |
| Blended interest rate | ~3% | Contingent on DOT staking APY ~5% |
| vDOT allocation | ~60% of principal | ~600,000 DOT minted as vDOT |
| Liquidity allocation | ~40% of principal | ~400,000 DOT deployed to vDOT-DOT pool |
| Repayment | Principal (1,000,000 DOT) + accrued interest | Full repayment at end of term |
The blended interest rate for Year 2 is projected at approximately 3% and Bifrost will NOT take any commissions from it. This rate is lower than Year 1 (5.318%) due to the adjustments of DOT inflation, validator commission and decreasing of staking reward.
Beyond liquidity and yield, vDOT now carries full Polkadot OpenGov participation rights. This section introduces two complementary governance features that increase vDOT's utility and strengthen its role within the Polkadot ecosystem.
Note on Loan-Derived vDOT: The ~600,000 vDOT minted under this Year 2 loan will be deployed into the vDOT-DOT liquidity pool and held under Bifrost Treasury custody. This vDOT does not participate in the delegated voting mechanism described in Section 5.2 — it is excluded from Polkadot OpenGov voting entirely (neither voted directly by Bifrost nor delegated under BNC governance), avoiding any appearance of loan-derived capital being used to influence on-chain governance outcomes.
vDOT holders can participate directly in Polkadot on-chain governance. Since the DOT underlying vDOT is staked via Bifrost's sovereign address and its derived keyless addresses on Polkadot, these addresses carry full governance voting rights. Through the Bifrost DApp, vDOT holders can:
This means vDOT holders do not sacrifice governance rights when liquid-staking DOT — a key differentiator for DOT LSTs.
Bifrost introduces a new governance layer: BNC holders can direct the voting rights of vDOT that has been delegated to Bifrost but whose holders have not cast a vote themselves.
Specifically:
This feature meaningfully increases Polkadot governance participation and gives BNC holders a direct stake in the direction of the Polkadot ecosystem — creating a deeper, more organic alignment between Bifrost and Polkadot governance.
Reference: docs.bifrost.io/faq/what-is-lst-governance
Kusama
Bifrost has brought a total income of 8,370.5523 KSM to the Kusama Treasury.
Polkadot