Certainly! Here’s the rewritten article:
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**Original | Odaily Planet Daily**
**Author | Azuma**
On June 29th, 2024, Polkadot community members Alice und Bob and Jeeper released the Polkadot Treasury operating report for the first half of 2024 on the official governance forum. The report contained figures so staggering that they sparked astonishment within the community, raising concerns about the current state and future sustainability of the Polkadot Treasury.
**Astronomical Expenditure**
The core points of the report highlighted that in the first half of 2024, the Polkadot Treasury spent a total of $87 million (11 million DOT). Considering the current Treasury reserve balance of $245 million (38.2 million DOT), at the current expenditure rate, these reserves would only last the Polkadot Treasury another two years…
These unexpectedly large numbers clearly shocked the entire industry. Synthetix founder Kain Warwick sharply commented, “The Polkadot Treasury burns money faster than hackers steal it.”
Following the shock came bewilderment. Many community members expressed on social media how hard it was to fathom how Polkadot managed to burn through $87 million in just half a year.
**Where Did the Expenditures Go?**
According to the detailed explanation in the “Payments” section of the report, compared to the second half of 2023, DOT-denominated expenditures from the Polkadot Treasury rose by 2.4 times. However, due to the increase in DOT’s own coin price, the U-denominated Treasury expenditures rose by 3.2 times.
In terms of expenditure categories, Polkadot’s Treasury expenditures are mainly focused on six major areas: Research, Operations, Talent Education, Economy, Development, and Marketing. Looking at the comparison from the chart below, while there have been slight shifts in expenditure structure tendencies, the absolute values of these six major areas have all increased compared to the second half of 2023.
The largest expenditure direction is in “Marketing” (outreach), with a total expenditure of $37 million. “Marketing” expenditures include advertising and media costs, expenses for online and offline community activities, and sponsorships for large conferences and business development activities. Advertising costs alone account for the majority, totaling $21 million, including sponsorships of $6.8 million to a football club, $1.9 million to race car driver Conor Daly, and $1.3 million to esports organization HEROIC.
The second-largest expenditure direction is “Development,” totaling $23 million. Of this, $5.1 million is allocated to the development of Polkadot protocols and SDK functionalities, $4.1 million to developing data services and indexing functionalities, and $3.9 million to support wallet developments like SubWallet, Talisman, and Nova.
Following closely is the “Economy” direction, which spent a total of $15 million, primarily used for liquidity incentives to attract traffic for many other public chain ecosystems.
The “Talent and Education” direction saw a total investment of $5.5 million in the first half of Polkadot. Ecosystem training and hackathons accounted for the majority, with $3.1 million allocated to the Polkadot Blockchain Academy series events and multiple hackathons, averaging between $60,000 and $600,000 per event.
In the “Operations” direction, Polkadot spent a total of $3.8 million in the first half of the year. The largest portion of this comes from “Governance,” totaling $2.5 million, including a $640,000 sponsorship by OpenGov for a foundation in the Cayman Islands.
“Research” is the smallest expenditure direction for Polkadot, totaling $2.1 million in the first half of the year.
**How Much Reserve Is Left? Can Income Grow?**
As mentioned earlier, the Polkadot Treasury currently has reserves totaling $245 million, equivalent to 38.2 million DOT. However, further clarification of the composition of these remaining reserves is necessary.
In summary, the composition of the remaining Polkadot Treasury reserves is as follows:
– Cash and cash equivalents: 29 million DOT (approximately $188 million), mainly including DOT, USDT, and USDC held by Polkadot in Relay Chain, AssetHub, and Hydration, available for immediate use by the Treasury.
– Unmanaged liquidity supply: 1 million DOT (approximately $6.4 million), mainly referring to 1 million DOT unilateral liquidity provided by Polkadot on Hydration Omnipool.
– Designated assets: 7.3 million DOT (approximately $47 million), referring to Treasury reserves used only for specific purposes such as compensation and sponsorship.
– Accounts receivable: 5.8 million DOT (approximately $37 million), referring to short-term loans provided by Polkadot to ecosystem projects like Bifrost and Pendulum.
Overall, despite facing expenditure pressures, the Polkadot Treasury’s reserve structure still signals a relatively ideal liquidity condition, with the vast majority of reserves readily available for immediate use.
Regarding whether the Polkadot Treasury can further generate revenue, the report also explicitly mentions that direct income from network fees remains insignificant. Apart from earning nearly 300,000 DOT during the second half of 2023 due to short-term staking fever, regular fee income remains quite stable — approximately 20,000 DOT per quarter.
The report also specifically mentioned passive income from DOT inflation (staking rewards). However, the two authors of the report, Alice und Bob and Jeeper, believe that while the Treasury can “profit” from the current 10% income, the current high inflation rate is “destructive” and detrimental to the long-term development of the Polkadot protocol and the stability of the DOT coin price.
**Community’s Valid Questions**
Combining the analysis of income and expenses and the analysis of remaining reserves mentioned earlier, it is evident that the Polkadot Treasury currently faces certain sustainability pressures. Although reserves exceeding $200 million are still sufficient, the excessively high expenditure and negligible income pose real challenges.
The community’s focus of doubt largely centers around Polkadot’s astronomical expenditure and its composition, especially the nearly half of it allocated to “Marketing” expenditures — while it’s understandable that development requires funding, operations, research, and education expenditures combined do not amount to much. Economic incentives even seem to be somewhat lacking, with the sole marketing expenditure totaling $37 million not only questionable in scale but seemingly yielding only “minimal” returns.
On this matter, renowned overseas KOL @Ignas questioned, “Polkadot spent $37 million on marketing, yet they have almost no presence on X and other social media platforms.”
While @Ignas’ description may be somewhat exaggerated, it is not without reason. Looking back over the past two years, concepts like Layer 2, modularization, chain abstraction, and restaking have consistently captured market attention. As a once-leading project, Polkadot’s presence on social media seems to have dwindled… whether it’s Jam or Coretime, if users aren’t actively following Polkadot’s ecological trends, how many actually know what they mean?
Ironically, today’s controversy over “excessive marketing expenditure” has become Polkadot’s largest exposure on social media in recent times.
A few months ago, a community member who has long been involved in the Polkadot ecosystem mentioned to us, “For community participants, the greatest value of Polkadot lies in its Treasury.”
If the Treasury continues to be consumed in this doubtful manner, what may soon be in doubt is the future of Polkadot itself.