As 2025 draws to a close, Polkadot is brewing a major overhaul that could redefine the economic model of the entire ecosystem for the next decade. If we had to pinpoint the most decisive change, it would be the new issuance curve and the reconstruction of the economic model for DOT.

**The Final Chapter of the Inflation Era**

The new issuance model is anchored on three core metrics: a hard cap of 21 billion, decreasing every two years by 13.14%. This mechanism takes effect from March 14, 2026. What does that mean? The annual issuance in 2026 will drop to 55,617,170 DOT, with an annualized staking yield of about 5.6%, and the inflation rate will decrease from high levels to around 3.11%. Simply put, DOT will no longer sustain the system through unlimited minting; supply will become predictable, transparent, and convergent.

**Shuffling the Validator Ecosystem**

In the past, validator income mainly came from inflation rewards. The new model completely changes this logic. Validator earnings now consist of three layers: operational subsidies in stablecoins (covering actual costs like servers and personnel), DOT staking rewards (lower than current), and security incentives in DOT (released linearly over a year to prevent short-term exploitation).

Supporting rules are also adjusted— the minimum self-stake threshold is 10,000 DOT, with an incentive curve that decreases as more is staked (marginal returns diminish with increased stake), and the unbonding period dynamically fluctuates between 2 and 28 days. The core idea of this design is clear: to align validator income more closely with actual costs rather than relying on inflation dividends.

**DAP: The Economic Nervous System of Polkadot**

The Dynamic Allocation Pool (DAP) has become the core of the new framework. All newly issued DOT, core time income, and transaction fees no longer flow directly to various components. Instead, they all go into the DAP first, then are allocated according to parameters to validator subsidies, security rewards, nomination rewards, the treasury, and strategic reserves.

A particularly noteworthy detail: the DAP can choose not to spend all funds, allowing for the creation of reserves to buffer against issuance declines. In the long run, this reserve pool is likely to evolve into the last line of defense supporting Polkadot’s stablecoins. In other words, the reform of the economic model is not just about adjusting distribution ratios but about establishing a more resilient ecological financial structure.