Cardano Developer Seeks Reduced Funding of $46.8 Million for Expansion and Bitcoin 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 this year. The company has submitted nine proposals totaling $46.8 million for 2026, which is roughly half of the $97.5 million requested in 2025. These proposals focus on enhancing Cardano's scalability and exploring opportunities in Bitcoin DeFi. The Cardano network, like other major blockchains, has a communal fund that is allocated by community representatives through a voting process. 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 now aims to reduce its reliance on community funding by decreasing its annual requests until it can sustain itself through its own revenue. This shift will allow community funds to support a broader range of smaller, specialized engineering groups. By the end of 2026, Input Output anticipates that smaller teams, such as VacuumLabs and Midgard Labs, will take over a significant portion of its current in-house work. The proposals submitted by Input Output can be categorized into two main themes: scaling and Bitcoin DeFi integration. The most substantial proposal is for a consensus upgrade called Leios, which is expected to increase Cardano's transaction processing capacity by 10 to 65 times, potentially exceeding 1,000 transactions per second. This upgrade would position Cardano as a competitive player in the blockchain space, rivaling the likes of Solana and Ethereum's layer-2 networks in terms of throughput. Leios is scheduled for a test release in June and is expected to be fully deployed by the end of the year. Another significant proposal is for a system called Pogun, which aims to introduce Bitcoin-based decentralized finance to the Cardano ecosystem. This system would enable bitcoin holders to borrow and earn yield on their holdings without having to rely on a centralized intermediary. The lending component of Pogun is slated for public release in the second quarter. Other proposals focus on enhancing the performance of Cardano's smart contract engine, improving security testing infrastructure, developing new tools for developers, and expanding API services. Each proposal outlines specific delivery leads and ties funding to the achievement of milestones, rather than providing upfront funding. The voting process, which is open to roughly 1,000 elected delegates known as DReps, will commence on Tuesday and conclude on May 24. The outcome of this vote will be a significant test of Cardano's governance system, which has undergone substantial expansion over the past two years. It will determine whether the community treats Input Output as any other grant applicant or continues to approve its requests based on its historical role in the project. The Cardano Foundation's takeover of the project's grant-funding arm and Intersect's assumption of stewardship over the core Cardano software have introduced alternatives to Input Output, which may influence the voting outcome. Meanwhile, Input Output has highlighted the progress made in the Cardano ecosystem, including the launch of a new stablecoin, USDCx, which has reached 14.6 million tokens in circulation, and the increase in total assets deposited on the network from $137.5 million to $142.7 million.