diff --git a/frame/dapps-staking/Cargo.toml b/frame/dapps-staking/Cargo.toml
index ecbea46e..0de5ca09 100644
--- a/frame/dapps-staking/Cargo.toml
+++ b/frame/dapps-staking/Cargo.toml
@@ -1,6 +1,6 @@
 [package]
 name = "pallet-dapps-staking"
-version = "3.8.0"
+version = "3.8.1"
 authors = ["Stake Technologies <devops@stake.co.jp>"]
 edition = "2021"
 homepage = "https://astar.network/"
diff --git a/frame/dapps-staking/src/lib.rs b/frame/dapps-staking/src/lib.rs
index b7f83bad..2b4df7d3 100644
--- a/frame/dapps-staking/src/lib.rs
+++ b/frame/dapps-staking/src/lib.rs
@@ -537,7 +537,7 @@ pub enum RewardDestination {
 
 impl Default for RewardDestination {
     fn default() -> Self {
-        RewardDestination::StakeBalance
+        RewardDestination::FreeBalance
     }
 }
 
diff --git a/frame/dapps-staking/src/tests.rs b/frame/dapps-staking/src/tests.rs
index a9ddaa91..3d5b90b1 100644
--- a/frame/dapps-staking/src/tests.rs
+++ b/frame/dapps-staking/src/tests.rs
@@ -1893,6 +1893,19 @@ fn changing_reward_destination_for_empty_ledger_is_not_ok() {
     });
 }
 
+#[test]
+fn default_reward_destination_is_free_balance() {
+    ExternalityBuilder::build().execute_with(|| {
+        initialize_first_block();
+
+        let staker = 1;
+        assert_eq!(
+            DappsStaking::ledger(&staker).reward_destination,
+            RewardDestination::FreeBalance
+        );
+    });
+}
+
 #[test]
 fn claim_dapp_with_zero_stake_periods_is_ok() {
     ExternalityBuilder::build().execute_with(|| {