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 this year. The firm has submitted nine proposals totaling $46.8 million for 2026, representing a nearly 50% reduction from the $97.5 million requested in 2025. The proposals focus on enhancing Cardano's scalability and exploring opportunities in Bitcoin DeFi. Cardano's treasury is a shared fund fueled by network fees, with community representatives voting on how to allocate the funds for development projects. Historically, Input Output has been the primary recipient of these funds due to its significant role in building the underlying software. However, the company is now working to reduce its reliance on community funding, with the goal of becoming self-sustaining through its own revenue. By the end of 2026, Input Output expects smaller, specialized teams to take over much of the work currently handled in-house, including collaborations with firms like VacuumLabs and Midgard Labs. The proposals are divided into two main categories: scaling and Bitcoin DeFi. The largest proposal supports the development of Leios, a consensus upgrade aimed at increasing Cardano's transaction processing capacity by 10 to 65 times, potentially exceeding 1,000 transactions per second. This would position Cardano as a competitive player alongside Solana and the fastest Ethereum layer-2 networks in terms of throughput. Leios is scheduled for a test release in June and full deployment by the end of the year. Another key proposal funds the development of Pogun, a system designed 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 centralized intermediaries. Pogun's lending component is targeted for public release in the second quarter. Smaller proposals address 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 delivery milestones, ensuring that funds are released in stages as different components of the project are completed. Voting on the proposals opens on Tuesday and will run through May 24, with roughly 1,000 elected delegates, known as DReps, making the decisions on behalf of ADA holders. The outcome of the vote will indicate whether Cardano's governance treats Input Output as any other grant applicant or continues to approve its requests based on its historical role in the project. Last year's $97.5 million proposal was approved, but the governance landscape has shifted significantly since then, with the Cardano Foundation taking over the project's grant-funding arm and Intersect assuming stewardship of core Cardano software. These changes mean that alternatives to Input Output now exist, potentially influencing the voting outcome. Input Output also highlighted progress within the ecosystem, 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, rising from $137.5 million to $142.7 million. The outcome of the vote will signal how the Cardano community's perspective has evolved, particularly in regards to funding development without relying on Input Output.