Polkadot announces a $ 770 million development fund weeks ahead of Network Parachain’s auctions

The founder of Polkadot, Gavin Wood released a $ 777 million development fund weeks ahead of the network’s parachain auctions.

wood tweeted Sunday what Polkadot Treasury has allocated more than 18.9 million polkadots (DOT) (valued at approximately $ 777 million at the time of writing) to a development fund to be paid by the local government.

Wood made extensive suggestions on how the funds could be used, stating that The capital will be used to realize the community’s vision of “building, improving, and educating” the polkadot ecosystem in addition to “anything else the Polkadot government deems valuable”.

Polkadot announces a $ 770 million development fund weeks ahead of Network Parachain’s auctions
Polkadot announces a $ 770 million development fund weeks ahead of Network Parachain’s auctions

According to the Polkadot Wiki, Treasury funds can be spent if approved by the council, which votes on the proposals put to it. The Polkadot Council currently consists of 13 members but plans to expand to 24 in the future.

With community involvement in many of the Polkadot governance votes being low, the Development Fund could serve to increase the participation of DOT holders in the governance process.. According to Polkassembly, the three government proposals put forward last week had an aggregate turnout of zero, six and seven votes, respectively.

Stakeholders wishing to submit a proposal should reserve a deposit of at least 5% of the proposed cost, which will be reduced if rejected (a mechanism to deter reviewer misconduct) or refunded if accepted. Since funds are at risk if a vote is not cast, Polkadot’s reduction mechanism can be a factor hindering governance engagement with the network.

The new development fund was also announced just weeks before Polkadot’s long-awaited Parachain auctions due to begin in early November, suggesting that The funds could be used to spur development targeting the upcoming polkadot parachain ecosystem.

Polkadot Parachain Auctions are used to realize Polkadot’s vision of a fragmented ecosystem. In the auctions, projects based on Polkadot compete for one of 100 parachain slots and offer to block the DOT.

Parachains are fragmented polkadot sidechains that can host decentralized applications and protocols. offer specialized computers and communicate with Polkadot’s proof-of-stake relay chain to complete transactions.

Polkadot’s existing relay chain only handles transfer, governance and staking services for the Polkadot network while Upcoming parchains will be commissioned to provide advanced functions such as smart contract functionality and cross-chain compatibility.

As such, The new development fund is designed to encourage developers to build on Polkadot to prepare for the Parchains release.

Many watchers have pointed to the Coinbase-backed Acala network as a favorite to win the first Parachain seat on Polkadot.. Karura Network, Acala’s stake on Polkadot’s sister network Kusama, won the first Parachain auction in Kusama in June by a clear margin.

Karura received the support of more than 15,000 companies to win its place with an offer of more than 500,000 Kusama (KSM). (valued at approximately $ 184 million at the time of this writing).

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