Live Review: 87 million US dollars were spent in half a year. How did Polkadot respond to the treasury controversy?

Original source: PolkaWorld

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Editors note: On June 29, members of the Polkadot community released the Polkadot Treasury Operation Report for the first half of 2024 on the official governance forum. The report shows that in the first half of 2024, the Polkadot Treasury spent a total of US$87 million (11 million DOTs), and the current reserves may only be enough for the Polkadot Treasury to support it for another two years. For a time, the community questioned the current status of the Polkadot Treasury and worried about its future sustainability. On the evening of July 2, Polkadot officials responded to the controversy about the Polkadot Treasury in the X Space live broadcast room, discussing Polkadots governance and financial operations. PolkaWorld summarized the key points of this live broadcast, and Odaily Planet Daily reprinted it as follows:

A brief summary of last night ’s @Polkadot livestream discussing the treasury spending $87 million:

@FabianGompf

1. There are different entities deploying capital in the Polkadot ecosystem, primarily on-chain treasuries and foundations.

2. Foundations may fund less eye-catching projects, while the treasury should fund more avant-garde and high-profile projects.

3. Treasurys spend a lot of money on critical infrastructure, but in recent months, on-chain treasuries have indeed spent too much on low-return activities.

@seunlanlege

1. Polkadot is a developer platform and should spend most of its funds on developer programs such as developer grants and hackathons.

2. Similar to NVIDIA’s approach, Polkadot should invest in developers and development tools rather than sports sponsorships or other marketing activities.

3. Funding new ideas and experimental projects is important because it is difficult for outside investors to support these teams without initial funding.

4. Compared with the current marketing which is mainly targeted at retail users, we should focus more on developers.

@giottodf

1. It is not considered a good idea to directly fund developers because it is difficult to evaluate which projects will be successful.

2. Demonstrate the openness of the Polkadot ecosystem through marketing and attract venture capital to invest in developers instead of directly funding developers.

3. It is emphasized that the funds in the treasury are constantly replenished through inflation, so there is no need to worry about running out of funds.

4. It is believed that a wave effect should be created through marketing to attract venture capital to invest in the Polkadot project.

@pambamdam

1. I disagree with Giottos point of view, because crypto venture capital prefers to invest in projects from zero to one rather than already public protocols.

2. It is believed that Polkadot, as a 5-year-old protocol, faces challenges in attracting venture capital, as venture capital prefers early-stage investments.

3. It is mentioned that Polkadot’s treasury needs to fill the gap in the ecosystem fund.

4. If there will be no new token sales or Jam tokens, it is recommended to attract key VCs through a treasury-funded token sale, selling to the most important VCs at a huge discount but with a long lock-up period to ensure their long-term participation.

@GregusJakub

1. Mentioning that Uniswap was started by a single developer funded by the Ethereum Foundation shows the importance of early funding.

2. Solana has regained VC support after the FTX incident by highlighting talented developers and projects in the ecosystem.

3. Emphasize the importance of ecosystem awareness and network effects on token prices. If the ecosystem is not known, there can be no optimistic ecosystem. Developers need to be first-class citizens of every chain and every ecosystem because the success of every token depends on network effects.

@GldnCalf

1. It is believed that OpenGovs decentralized decision-making model requires more ecosystem participants to proactively propose proposals and take actions.

2. Some suggestions for participating in the Treasury proposal process are provided, and critics are encouraged to become doers and put forward more constructive proposals.

3. Acknowledge that there is waste in the system, but emphasize the importance of learning from mistakes to become more efficient.

@0xtherealbatman

1. Emphasize the need to fund both developers and marketing, and not rely on just one to break the network effect.

2. It points out that currently too little funding is invested in developer education and that funding in this area needs to be increased.

@filippo web3

1. It is mentioned that the treasury is constantly replenished through inflation and transaction fees, but the current inflation revenue is small.

2. Emphasize the need for more users and developers to demonstrate Polkadots capabilities and use treasury funds to attract these users and developers.

@irvinxyz

1. It is believed that Polkadot is in a transitional stage of growth and needs to balance decentralization and business development.

2. It is mentioned that it is difficult for the outside world to understand OpenGov and more explanation and promotion are needed.

3. Request Jay to briefly introduce the workflow of the Treasury proposal so that newcomers can better participate.

@lolmcshizz

1. It is mentioned that Polkadot has the ability to adjust the allocation of inflation through governance to pay staking rewards and fund the treasury.

2. A new feature called Optimistic Project Funding was recently approved to direct inflation funds to projects in the ecosystem that are deemed valuable.

3. Emphasize that Polkadot can flexibly adjust funding allocation to meet the needs of the ecosystem.