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

Input Output, the private company responsible for building and maintaining the Cardano blockchain, is seeking a substantially lower amount of funding from the project's community treasury this year. The company has submitted nine proposals totaling $46.8 million for 2026, marking a notable reduction from its $97.5 million request in 2025. These proposals focus on enhancing Cardano's scalability to increase its transaction capacity and exploring opportunities in Bitcoin DeFi. Cardano, similar to other major blockchains, has a communal fund fueled by network fees, which is allocated towards development projects through a voting process by community representatives. Historically, Input Output has been the largest recipient of these funds due to its significant role in developing the underlying software. However, the company now aims to decrease its reliance on community funding annually, with the goal of becoming self-sustainable through its own revenue. By the end of 2026, Input Output expects smaller, specialized teams to undertake most of its current in-house work, including collaborations with firms like VacuumLabs and Midgard Labs that focus on specific aspects of the Cardano software. The proposals can be grouped into two main themes: scaling and Bitcoin DeFi integration. A key proposal is the Leios consensus upgrade, which Input Output claims will significantly increase Cardano's transaction processing capacity, potentially making it competitive with Solana and the fastest Ethereum layer-2 networks in terms of throughput. Leios is slated for a test release in June and full deployment by the end of the year. Another significant proposal involves the Pogun system, designed to integrate Bitcoin-based decentralized finance into Cardano, allowing bitcoin holders to borrow and earn yield on their holdings without relying on centralized intermediaries. Smaller proposals cover 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 funding. The voting process, which begins on Tuesday and concludes on May 24, will be decided by approximately 1,000 elected delegates known as DReps, who represent ADA holders. The outcome of this vote will indicate whether Cardano's governance treats Input Output similarly to other grant applicants or if it continues to approve its requests based on historical precedence. Last year's $97.5 million proposal was approved, but since then, significant changes have occurred, including the Cardano Foundation taking over the project's grant-funding arm and Intersect assuming stewardship of core Cardano software. These shifts mean that alternatives to Input Output now exist, potentially influencing the voting outcome. Input Output also highlighted ecosystem progress, including the launch of a new Cardano stablecoin, USDCx, which reached 14.6 million tokens in circulation shortly after its launch, and an increase in total assets deposited on Cardano. The result of the vote will signal how the Cardano community's perspective has evolved, especially considering the new avenues for funding development projects without relying on Input Output.