Polkadot community votes on DOT backed native stablecoin dotUSD

Polkadot’s community has opened a governance vote on a native decentralized stablecoin called dotUSD, with a proposal to make the dollar-pegged asset the network’s primary stable-value instrument and eventually back it mainly with DOT. Summary Polkadot OpenGov is voting on a proposal to create dotUSD as the network’s native decentralized stablecoin. The plan calls for $5 million in initial DOT and USDT liquidity for a DOT and dotUSD pool. dotUSD would initially be minted against USDT before a second phase introduces DOT backed vaults, liquidations and redemptions. The full system would let users lock DOT to mint dotUSD while using on chain mechanisms to maintain its dollar peg. According to OpenGov Referendum 1944, the proposed stablecoin would be owned by the protocol and operate autonomously through on-chain logic, without a centralized issuer. The proposal was drafted with contributions from builders, developers and other participants in the Polkadot ecosystem. The proposal remains in the decision stage at the time of writing. Its implementation would create dotUSD as a new asset, recognize it as the Polkadot stablecoin and establish a DOT/dotUSD liquidity pool on Polkadot Asset Hub. An archived Polkassembly snapshot showed 2.4 million DOT voting in favor and 59,900 DOT against, equivalent to 97.5% Aye and 2.5% Nay at that point in the vote. The archive cautioned that the figures were frozen while the referendum was still in progress and may not represent the eventual on-chain result. Polkadot proposes phased launch for dotUSD Under the plan, dotUSD would initially operate differently from the full DOT-backed system envisioned by its developers. The first phase has already been built on-chain and would allow users to mint dotUSD one-for-one against USDT, subject to a supply cap. Since USDT would provide the reserve backing at this stage, the system would not require an oracle, collateral vaults or liquidation infrastructure. The proposal seeks to use Polkadot Treasury assets to seed a DOT/dotUSD pool on the Hub decentralized exchange. The version submitted with the referendum allocated $2.5 million in USDT to mint dotUSD and another $2.5 million worth of DOT to the pool, giving it $5 million in initial liquidity. A more recent version displayed on Subsquare lists $1.5 million in USDT and $1.5 million in DOT for the initial pool, reducing the proposed allocation to $3 million. You might also like: Jack Dorsey’s Block files OCC application for Bitcoin and stablecoin custody bank dotUSD would be designated a “sufficient asset,” allowing an account to hold the stablecoin without having to maintain a DOT balance. Governance would set parameters for the peg stability module, including the maximum amount of dotUSD that could initially be minted.