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

Input Output, the company responsible for developing the Cardano blockchain, is seeking a substantially lower amount of funding from the project's treasury this year. The firm has submitted nine proposals amounting to $46.8 million for 2026, down from $97.5 million in the previous year. These proposals focus on enhancing Cardano's scalability and exploring opportunities in Bitcoin DeFi. Cardano, like other major blockchains, has a community-managed treasury that allocates funds for development work through a voting process. Historically, Input Output has been the largest recipient of these funds due to its significant role in building the underlying software. However, the company now aims to reduce its dependence on community funding by 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 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 are centered around two main themes: scaling and Bitcoin DeFi. One of the key proposals, Leios, promises to significantly increase Cardano's transaction processing capacity, potentially making it competitive with other fast blockchain networks like Solana and Ethereum layer-2 networks. Another significant proposal, Pogun, aims to introduce Bitcoin-based decentralized finance to Cardano, allowing bitcoin holders to lend and earn yield on their holdings without relying on centralized intermediaries. Smaller proposals cover various improvements to Cardano's smart contract engine, security testing, developer tools, and API services. Each proposal outlines specific delivery leads and ties funding to milestone-based delivery, ensuring that funds are released in stages as different components of the project are completed. The voting process, which is open to roughly 1,000 elected delegates representing ADA holders, will determine the fate of these proposals. The outcome 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 deference. The Cardano Foundation's takeover of the project's grant-funding arm and Intersect's assumption of core Cardano software stewardship have introduced alternatives to Input Output, potentially influencing the voting outcome. Meanwhile, Input Output has highlighted progress within the ecosystem, including the launch of a new Cardano stablecoin, USDCx, which has seen significant circulation, and an increase in total assets deposited on the network.