Polkadot (DOT): the network behind 2.1 billion tokens and its parachains

Polkadot is a network that brings many independent blockchains together under a shared security umbrella. Polkadot is therefore neither an application platform like Ethereum nor a payment network like bitcoin, but an infrastructure layer that provides other blockchains with computing time and security. The network's token is called DOT.

For you as an investor, three things matter most: what the token is actually used for, how many DOT can ultimately exist and what you get if you lock them up in the network. This profile answers these questions one by one and gives the source for every figure.

For context, the market picture: according to CoinGecko, DOT cost $0.95 at midday on Saturday, ranking 56th by market capitalisation, which stands at around $1.63 billion. Over the past 24 hours the price moved between $0.94 and $0.98; over seven days it is down 9.9 percent, over 30 days 20.8 percent. It remains far from its all-time high of $54.98 from November 2021.

Polkadot explained: relay chain, Asset Hub and the connected blockchains

The network consists of several layers. At its core is the relay chain. Hardly any applications run there; its job is security. Validators check the blocks of the connected blockchains and confirm them jointly. These connected blockchains are called parachains. Each has its own rules, its own fees and often its own token, but inherits the relay chain's security instead of laboriously building its own.

The practical advantage lies in interoperability. Because all parachains hang off the same infrastructure, they can send messages and value to one another without using a third-party bridge. It is precisely at such bridges that the largest sums have been lost in recent years.

Since November 2025, Asset Hub has been the address for users

Anyone working with Polkadot today no longer ends up on the relay chain. According to the Polkadot documentation, account balances were migrated from the relay chain to Asset Hub on November 4, 2025; on Kusama, the experimental sister network, this had already happened on October 7, 2025. Staking and voting have since run on Asset Hub and are no longer available on the relay chain.

For you, that means one thing above all: if a wallet or block explorer shows a balance of zero, the money is not necessarily in the wrong place. Often the tool is still looking at the old address. The relay chain continues to handle consensus and messaging between blockchains, but the bookkeeping for user accounts is on Asset Hub.

The DOT token: voting rights, security and buying computing time

The Polkadot documentation names three roles for DOT. First, governance: DOT holders can vote on protocol changes and submit their own proposals. Second, staking: those who lock their tokens secure the network and are rewarded for it. Third, access to computing time: DOT is used to buy coretime, the slot on which a connected blockchain has its blocks processed.

One quirk that keeps causing confusion in wallets: the smallest unit is called a Planck. One DOT equals ten billion Planck. So if an interface shows a ten-digit number, that is not a software error. It is the same sum, just in the smallest unit.

Coretime is the technical term for rented computing time on one of the network's cores. A project buys in for a period of time instead of permanently owning a slot.

2.1 billion DOT: the supply cap and the stepped inflation plan

For a long time, DOT was a token without a fixed maximum. The protocol issued a fixed amount of new tokens every year, 120 million DOT a year under the older model, of which 85 percent went to stakers and 15 percent flowed into the network's treasury. Anyone doing long-term calculations therefore had to factor in a permanently growing supply.

That has changed. According to the Polkadot documentation, Referendum 1710, implemented in January 2026, introduced a capped, stepped schedule: total supply is limited to 2.1 billion DOT, and new issuance falls every two years by 13.14 percent of the remaining gap to that limit. The first step took effect on March 14, 2026. The closer supply gets to the cap, the less is added.

According to CoinGecko, around 1.71 billion DOT are currently in circulation. That leaves room for about 390 million more tokens up to the cap. This figure is the real yardstick for dilution, and it is considerably smaller than what seemed possible in previous years.

One caveat applies: the documentation explicitly notes that net inflation cannot be predicted with certainty. Some of the issued tokens are burned again, for example from the treasury and from coretime sales. How much that amounts to in a given year depends on demand.

Asset Hub migration: what changes for DOT holders day to day

The most important functions moved over with the migration to Asset Hub. Keep three things in mind if you come across older guides online.

First, guides showing you how to nominate on the relay chain are out of date. Staking takes place on Asset Hub, and rewards are claimed there too. Second, anyone running a wallet or their own node needs to make sure they use the right network endpoint, otherwise the interface will show an empty account. Third, the relay chain remains in place technically, but for end users it is no longer a place where anything needs doing.

If your DOT are held on an exchange, the migration did not affect you anyway. The custodians handled the switch in the background.

Coretime instead of parachain auctions: how projects join the network

This is where the model has changed most clearly, and anyone reading old explainers will get the wrong picture. In the past, the way into the network was an auction: a project had to win a slot that guaranteed it block processing for up to two years. That tied up large amounts of DOT, often raised from the project's own community.

The auction model is history. It has been replaced by Agile Coretime. Computing time is now sold in periods; according to the documentation, a period in the bulk sale lasts 28 days. Those with more load buy more cores, those who need less buy fewer. The price is set in a process with falling bids that is meant to find an equilibrium price.

For the token's valuation, this cuts both ways. Entry becomes cheaper and more flexible, which can attract more projects. At the same time, large DOT holdings are no longer locked up for years for slots, which has shrunk a source of demand that existed under the old model.

Polkadot staking: a 28-day lock-up and a dynamic minimum

For many DOT holders, staking is the main reason to hold the token. The mechanism is called Nominated Proof of Stake. You do not run a node of your own. Your stake backs validators who check the blocks. If everything runs smoothly, you receive a share of new issuance. If a validator misbehaves, part of the stake can be slashed, including yours as a nominator.

The key figure is the lock-up. The Polkadot documentation gives 28 days for unbonding. Anyone who wants their stake back starts the process and waits four weeks before the tokens are freely available again. During that time you bear the full price risk but cannot sell. For a token that has lost a good fifth of its value over the past 30 days, this is where the decision is made.

On the size of the reward: a cryptoticker.io analysis of October 11, 2026, based on data from Staking Rewards, showed a rate of 2.77 percent a year, with 913.06 million DOT staked and a staking ratio of 53.5 percent. That ratio is the lever: the more tokens are staked, the smaller the share per unit. The details are in our analysis of the Polkadot staking yield. Recalculate the rate before deciding, as it moves with the ratio.

Minimum stake and nomination pools

There is no fixed minimum for nominating. The number of nominators selected per era is limited, because the calculation has to fit into the computing time of a single block. This results in a minimum stake that shifts constantly. Anyone below it gets nothing.

For smaller amounts there are nomination pools. Several participants pool their stake and act together as a nominator. The 28-day lock-up applies there as well. If you want to go through a provider, you will find the terms in the comparison of staking providers, which also shows what fee is deducted from the rewards.

OpenGov: how DOT holders vote on the treasury and the protocol

Polkadot is not run by a company. Changes go through a voting system called OpenGov. Every DOT holder can submit proposals and vote, with the weight of a vote depending on the stake and the voluntary lock period. Approved decisions are then executed automatically in the code.

This is no formality. The 2.1 billion token cap, now regarded as a feature of the network, is the result of such a decision. The same process allocates treasury funds to developers, events and tools. Holding DOT therefore also means having a say in the monetary policy of your own token.

The flip side: votes can change directions you had planned around. A rule that applies today is no guarantee for next year. Anyone holding DOT for the long term should at least roughly follow the current proposals.

Buying Polkadot in Germany: check the licence, decide on custody

The purchase itself is unremarkable. DOT is listed on the major trading venues and can be traded against the euro. More important than the provider's name is whether the platform is authorised in the EU. Since the Markets in Crypto-Assets Regulation, MiCA for short, providers need a licence to serve retail clients in Germany. That licence can be checked in the supervisor's register, and it determines what obligations the provider has towards you.

Then comes the question of custody. If the tokens stay on the exchange, access is convenient, and staking there often takes a single click. In return, you hand over the keys and bear the provider's risk. If your DOT sit in your own wallet, you are responsible for securing them yourself, but you have full control and can nominate and vote directly on the network.

Tax: what you should record

For private investors in Germany, gains from selling crypto assets count as private sales transactions, for which a holding period applies. Staking income is treated separately and counts as other income. Because the two are recorded differently, it pays to keep clean records from the start: purchase date, amount, price and, for staking, the time of receipt. Clarify the details and current thresholds with your tax adviser; a tool handles the record-keeping more reliably than a spreadsheet kept by hand.

DOT risks: dilution, competition and a price far below its high

A profile that only praised the technology would be incomplete. Four points belong on the other side of the ledger.

The price is around 98 percent below the all-time high of $54.98 from November 2021. That is no argument against the technology, but it shows how far expectations and market price can diverge. Second, despite the cap, new tokens continue to be added, around 390 million up to the maximum. Those who stake offset part of this; those who only hold bear the dilution.

Third, competition for developers is fierce. Polkadot competes with networks that can point to a larger developer ecosystem and more applications. Fourth, the 28-day lock-up ties your hands in precisely the phases when flexibility would be worth the most. So never calculate with the staking yield alone; always set it against the price volatility.

Buying and staking Polkadot: the 28-day lock-up is the sticking point

1. Sort out access. Check whether your trading venue has a MiCA licence for Germany and what buying and withdrawing cost. If you do not have a suitable provider yet, compare the terms in the overview of crypto exchanges.
2. Run the staking numbers before you lock. Set the current annual rate against the 28-day lock-up and ask yourself whether you can live with four weeks without being able to sell. The providers' fee models are listed in the comparison of staking platforms.
3. Set up record-keeping. Note purchase date, amount and price, and record staking receipts separately. The overview of tax tools shows which programs log this automatically.

(As of October 31, 2026. This article is not investment advice. Prices and fee structures change; check the terms with the provider before you buy.)