The Polkadot community can now vote on a redenomination proposal for its platform’s native token, DOT, which is set to see its supply increase. According to the options available, the genesis 10 million tokens will either remain the same, split of 10x, split of 100x or split of 1000x. So far, the 100x split has the most traction as the ‘no change' option tails in preference.
A medium blog post on July 13 by the co-founder of Polkadot's Web3 Foundation, Gavin Wood, has since detailed the intended process towards DOT redenomination and expected impact. The blog goes on to invite all Polkadot stakeholders to claim their DOT tokens on the mainnet so as to participate in the voting. It is scheduled to last for the next two weeks.
Notably, a similar test-tube had been done on Polkadot's ‘wild cousin', Kusama, where most participants were for the 100x split. A few descending parties, however, questioned the logic behind rallying 100x split and not 10x or 1000x. Following this outcome, Web3 Foundation decided to conduct a real vote based on the DOT tokens in a bid to consider more practical issues around the redenomination proposal.
As per the research done by Polkadot, a move towards redenomination would certainly affect the platform's contributors including the community. Infrastructure providers were sanguine about DOT's redenomination with the only preference being in execution time. In their opinion, it should happen around launch in order to minimize the associated workload.
Polkadot's community on the other hand noted that some DOT token holders may be affected if its underlying is changed from the 2017 pre-sale definition. Consequently, Polkadot gave its community's concern a priority and settled for a more friendly transition in case of a redenomination,
“Provide a ‘grace period' after transfers are enabled, to avoid any confusion or ambiguity on Day 1 regarding the original DOT denomination. This means switching the denomination while the system is fully ‘live'”.
Polkadot's First Vote
This platform went live as recent as May and will mark its first community vote with the DOT redenomination proposal. The voting will cost nothing apart from transaction fees and can be initiated by all accounts whose spendable balance is non-zero. It is quite noteworthy that the vote will not affect Polkadot's tokenomics given its main focus is on redenomination which basically translates to the unit display fundamentals.
“Staking rewards, inflation, effective market capitalisation and the underlying balances of every account remain completely unchanged.”
Should the stakeholders vote for 10x, 100x, 1000x split or no change, DOT prices will change to $152 to $15, $1.52, or $0.15 as per the prevailing market value on CoinGecko. Polkadot is optimistic that a redenomination vote will solve some underlying challenges in decimal point recordings as well as the calculation function.