Polkadot News Today: Polkadot's DOT Token Surges 32% on Regulatory Progress and New PoP Model

Polkadot, a prominent blockchain platform, has seen a significant rally in recent days, with its native token DOT surging by 32% over the past 10 days. This surge is largely attributed to major regulatory progress and the unveiling of a new Proof-of-Personhood (PoP) model by Polkadot founder Gavin Wood. The PoP model aims to address a $500 million annual problem by replacing the existing Nominated Proof-of-Stake (NPoS) validation model with an identity-based system. This shift could potentially save Polkadot $410 million annually by reducing security costs and encouraging real value and participation.

During the Berlin 2025 Web3 Summit, Wood proposed that the current NPoS setup, which rewards validators and accounts for around 85% of DOT’s 10% annual inflation, is unsustainable. The PoP model would strengthen Sybil resistance and replace outdated tools like CAPTCHA, SMS, and KYC, which are increasingly vulnerable in an AI-driven world. With fixed validator salaries, KYC, and an issuance model with biannual reward halvings, Wood anticipates an 80% cut in security costs to $90 million. This would mirror Bitcoin-style halvings, shifting Polkadot from an inflationary model to one with store-of-value properties, especially with the proposed hard cap of 3.14 billion DOT.

The proposed bi-annual reward halving and token unlock schedule creates scarcity, which could lead to more favorable supply-demand dynamics for long-term growth. However, the near-term Polkadot price rally stands to see a correction as it exhausts the full breakout momentum of a descending channel forming since its early May local top. The pattern’s projected 0.5 Fibonacci retracement level top at $4.34 has been surpassed, and momentum indicators now show cracks in buy pressure that could lead to a correction. The RSI now sits above the oversold threshold at 72, an area that typically precedes corrections as buyers reach their point of exhaustion. Still, the MACD line continues to widen its gap above the signal line, a strong sign that an uptrend is the prevailing trend despite some friction.

The immediate 0.382 Fibonacci retracement level at $4 is the most credible support, marking a correction of 8% that could form a base for the next move once volatility stabilizes. From there, a decisive move above $4.34 would confirm bullish continuation toward a key historic support zone at $5.44 —a potential 23% climb from current levels. Looking further ahead, Polkadot would enter a zone of sparse resistance, with $6.50, $7.50, and $8 being the key levels to watch before a full return to its previous $11.60 all-time high. With altcoin season drawing fresh retail liquidity to strong narratives and fundamentals, if Wood’s proposal passes a community vote, DOT could be the one to reap this fresh demand.

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