Cardano Developer Seeks Reduced Funding 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 community treasury for 2026. The company has submitted nine proposals totaling $46.8 million, which is roughly half of the $97.5 million it requested in 2025. The proposals focus on enhancing Cardano's scalability and exploring Bitcoin DeFi opportunities. This reduced funding request marks the first step in Input Output's plan to decrease its reliance on community funds and become self-sufficient. The company aims to gradually reduce its annual funding requests until it can sustain itself on its own revenue. By the end of 2026, Input Output expects smaller, specialized teams to take over most of its in-house work, including firms like VacuumLabs and Midgard Labs that focus on specific aspects of the Cardano software. The proposals are divided into two main themes: scaling and Bitcoin DeFi. The first theme includes a consensus upgrade called Leios, which is expected to increase Cardano's transaction processing capacity by 10 to 65 times, allowing it to compete with faster Ethereum layer-2 networks and Solana. Leios is scheduled for a test release in June and full deployment by the end of the year. The second flagship proposal involves a system called Pogun, which aims to bring Bitcoin-based decentralized finance to Cardano. This would enable bitcoin holders to borrow and earn yield on their holdings through Cardano without relying on a centralized intermediary. Pogun's lending component is set to be released publicly in the second quarter. Other proposals cover performance improvements to Cardano's smart contract engine, security testing infrastructure, developer tools, and expanded API services. Each proposal has specific delivery leads and ties funding to delivery milestones, rather than releasing the funds upfront. The voting process, which is open until May 24, will be decided by approximately 1,000 elected delegates known as DReps, who represent ADA holders. The outcome of the vote will test whether Cardano's governance treats Input Output like any other grant applicant or continues to approve its requests based on deference. Meanwhile, Input Output has highlighted progress in the ecosystem, including the launch of a new Cardano stablecoin, USDCx, which has reached 14.6 million tokens in circulation within weeks of its launch. The total assets deposited on Cardano have also increased from $137.5 million to $142.7 million over the same period.