Cardano Developer Seeks Reduced Funding of $46.8 Million for Expansion and DeFi Integration

Input Output, the company responsible for building and maintaining the Cardano blockchain, is seeking a substantially lower amount of funding from the project's treasury for 2026. The firm has submitted nine proposals amounting to $46.8 million, which is roughly half of the $97.5 million it requested in 2025. These proposals are focused on enhancing Cardano's scalability and exploring opportunities in Bitcoin DeFi. Cardano's treasury is funded by network fees, and community representatives vote on how to allocate these funds for development purposes. Historically, Input Output has been the primary recipient of these funds due to its significant role in developing the blockchain's underlying software. However, the company aims to reduce its dependence on community funding by gradually decreasing its annual requests until it can sustain itself through its own revenue. By the end of 2026, Input Output expects smaller, specialized teams to take over a significant portion of its current in-house work. The nine proposals can be grouped into two main categories. The first focuses on a consensus upgrade called Leios, which is designed to increase Cardano's transaction processing capacity by 10 to 65 times, potentially exceeding 1,000 transactions per second. This upgrade is scheduled for a test release in June and full deployment by the end of the year. The second key proposal involves a system called Pogun, which aims to introduce Bitcoin-based decentralized finance to the Cardano ecosystem. This system would allow Bitcoin holders to borrow and earn yields on their holdings without relying on centralized intermediaries. Pogun's lending component is targeted for public release in the second quarter. Other proposals cover various aspects such as performance enhancements to Cardano's smart contract engine, security testing infrastructure, developer tools, and expanded API services. Each proposal outlines specific delivery leads and ties funding to the achievement of milestones rather than providing upfront financing. The voting process, which is open to roughly 1,000 elected delegates known as DReps, began on Tuesday and will conclude on May 24. The outcome of this vote will indicate whether Cardano's governance treats Input Output similarly to other grant applicants or continues to approve its requests based on historical deference. Last year, Input Output's $97.5 million proposal was approved, but since then, significant changes have taken place, including the Cardano Foundation taking over the project's grant-funding arm and Intersect assuming stewardship of the core Cardano software. These changes mean that alternatives to Input Output now exist, which could influence the voting outcome. Input Output also highlighted ecosystem progress, including the launch of a new Cardano stablecoin, USDCx, which has reached 14.6 million tokens in circulation, and an increase in total assets deposited on Cardano from $137.5 million to $142.7 million.