Updated on:12/01/2025 05:03 PM 
CryptoSlate sat down with James Wo, the Founder and CEO of Digital Finance Group (DFG), to discuss the exciting developments poised to unfold within the burgeoning ecosystem of the two interconnected networks–Polkadot and Kusama.
DFG is a global blockchain-focused investment firm with a portfolio spanning Layer 1, Layer 2, Web3, CeFi, DeFi, NFTs, and beyond.
Last year, DFG allocated a significant 80% of its investments into the Dotsama ecosystem. So, what is on Wo's radar for the coming year?
Read on to discover which specific sector James is particularly bullish on and his insights into Polkadot's competitive landscape.
With 24 parachain auctions already completed, Kusama is paving the way, while Polkadot is finalizing its first batch of 10 slots.
Expecting to see 30 to 40 Polkadot parachains go live within the year, James predicts a period of thrilling developments, as the ecosystem arrives at what he calls "a critical inflection point."
Wo highlighted three primary factors driving this momentum.
“First, we have evidence that as more parachain auctions occur and more slots are won, the cost for each lease on Kusama and Polkadot decreases at a rapid rate,” Wo noted. He explained that this trend will provide projects from other ecosystems the opportunity to integrate into Kusama or Polkadot, consequently making the sister chains' ecosystem a more diverse and vibrant one.
“Second, with the leading Kusama and Polkadot projects—such as Karura (Acala), Moonriver (Moonbeam), and Shiden (Astar)—running successfully on their respective chains, we should begin to see evidence of collaboration and interaction among them,” he added, pointing out that the true benefits of the parachain model are yet to be fully unveiled.
“Third, within each of these projects lies a nascent ecosystem ready to develop. This, in turn, will showcase the strengths of each individual project and the advantages it holds compared to competitors, both inside and outside the Kusama/Polkadot community,” Wo concluded.
The coming year will be pivotal for testing developments between interoperable cross-chain ecosystems like EVM and IBC.
“However, there are still aspects that need to be improved,” said Wo, referencing Vitalik Buterin, who recently brought to light some of the fundamental downsides of highly efficient cross-chain solutions, such as the user-unfriendly Cosmos IBC.
Ethereum co-founder Vitalik Buterin has outlined the risks associated with cross-chain ecosystems, citing the "fundamental security limits of bridges."
While arguing why cross-chain bridges may not be a cornerstone of the multi-chain future, Buterin explained how a theoretical 51% attack on a single chain could create a contagion effect, spreading damage to connected ecosystems.
“As an alternative, Polkadot introduces a robust solution from the outset and builds the ecosystem around it,” Wo argued. He added that "although every blockchain running as a parachain will operate on a shared consensus, this adds complexity in the short term but enables greater security and diversity within the ecosystem, leading to better long-term results.”
Overall, James Wo believes that the most significant growth potential this year will be concentrated in the Metaverse sector.
“The Metaverse is positioned to be among the biggest growth drivers within Kusama/Polkadot, just as in other protocols. Key players in this space include the well-known team from Enjin with their Polkadot-native project Efinity, and T.Realty with their unique metaverse platform,” he pointed out.
He forecasts similar growth for the gaming sector within Kusama/Polkadot, expecting to see significant expansion in projects like Kanaria and RMRK, as well as Efinity.
“Ultimately, I expect crypto-native, community-driven projects like those being developed on Kusama and Moonbeam to expand their use cases and product offerings to attract a broad range of potential investors and users,” said Wo, citing standout examples like RomeDAO with its stablecoin focus, and Moonbeans as an NFT marketplace built on Moonbeam.
Despite his excitement for new frontiers, Wo added that DFG remains "definitely optimistic about the future of DeFi within the Kusama/Polkadot ecosystems."
DeFi projects are already strongly represented in Dotsama, and Wo sees projects like Acala, Bifrost, Composable Finance, Equilibrium, Interlay, HydraDX, and Minterest "growing exponentially and continuing to expand the variety of products and services offered to users."
About a year ago, DFG launched a dedicated Polkadot fund focused solely on DOT ecosystem investments and development.
Throughout this year, the fund will continue to provide support for compelling and high-quality projects that show potential to contribute to the emerging ecosystem. It is on the lookout for both mature projects interested in migrating to Polkadot and those starting from scratch and building with Substrate.
The fund has already contributed over three million DOT in Polkadot Crowdloans and will continue to strategically back its chosen projects, helping them secure their parachain slots.
Ultimately, the fund remains committed to promoting the Polkadot ecosystem by focusing on raising awareness and fostering mainstream adoption.
