The post Polkadot Votes on Bold Plan for Its Own Algorithmic Stablecoin appeared on BitcoinEthereumNews.com. Altcoins 30 September 2025 | 08:00 Polkadot’s community is currently weighing a major proposal that could reshape the network’s financial foundation: the creation of a native algorithmic stablecoin fully backed by DOT. The initiative was put forward by Bryan Chen, co-founder and chief technology officer at Acala, who argued that Polkadot needs a self-sustaining stablecoin to reduce reliance on external assets like USDT and USDC. Dubbed pUSD, the coin would be minted using the Honzon protocol, Acala’s system for overcollateralized debt positions. Holders would also gain access to an optional savings module, enabling them to lock tokens in exchange for yield from stability fees. Community sentiment so far suggests broad approval. More than 75% of the ballots have been cast in favor, with over 1.4 million DOT – valued at around $5.6 million – already committed to the vote. The decision window remains open for another 24 days, giving additional participants time to weigh in. Chen stressed that without a native stablecoin, Polkadot risks losing liquidity and competitive advantages to ecosystems that already have self-issued alternatives. He described the proposed design as a way to strengthen the network’s position while maintaining decentralization, since the peg would be preserved entirely through on-chain mechanisms and economic incentives. Algorithmic stablecoins, however, remain a controversial category. The collapse of TerraUSD (UST) in 2022 still casts a long shadow over the sector, as its implosion erased billions in value and damaged trust in algorithmic designs. Despite that history, advocates argue the model offers unique benefits, especially in terms of censorship resistance and permissionless access. Critics, meanwhile, warn that such projects could pave the way for “dark stablecoins” that evade regulatory oversight. Whether Polkadot’s pUSD can avoid the pitfalls that doomed earlier experiments remains to be seen. But with momentum building in favor of the proposal,… The post Polkadot Votes on Bold Plan for Its Own Algorithmic Stablecoin appeared on BitcoinEthereumNews.com. Altcoins 30 September 2025 | 08:00 Polkadot’s community is currently weighing a major proposal that could reshape the network’s financial foundation: the creation of a native algorithmic stablecoin fully backed by DOT. The initiative was put forward by Bryan Chen, co-founder and chief technology officer at Acala, who argued that Polkadot needs a self-sustaining stablecoin to reduce reliance on external assets like USDT and USDC. Dubbed pUSD, the coin would be minted using the Honzon protocol, Acala’s system for overcollateralized debt positions. Holders would also gain access to an optional savings module, enabling them to lock tokens in exchange for yield from stability fees. Community sentiment so far suggests broad approval. More than 75% of the ballots have been cast in favor, with over 1.4 million DOT – valued at around $5.6 million – already committed to the vote. The decision window remains open for another 24 days, giving additional participants time to weigh in. Chen stressed that without a native stablecoin, Polkadot risks losing liquidity and competitive advantages to ecosystems that already have self-issued alternatives. He described the proposed design as a way to strengthen the network’s position while maintaining decentralization, since the peg would be preserved entirely through on-chain mechanisms and economic incentives. Algorithmic stablecoins, however, remain a controversial category. The collapse of TerraUSD (UST) in 2022 still casts a long shadow over the sector, as its implosion erased billions in value and damaged trust in algorithmic designs. Despite that history, advocates argue the model offers unique benefits, especially in terms of censorship resistance and permissionless access. Critics, meanwhile, warn that such projects could pave the way for “dark stablecoins” that evade regulatory oversight. Whether Polkadot’s pUSD can avoid the pitfalls that doomed earlier experiments remains to be seen. But with momentum building in favor of the proposal,…