Cardano Developer Submits $46.8 Million Funding Proposal for 2026, Focusing on Scalability and Bitcoin DeFi Integration

The company behind the Cardano blockchain, Input Output, is seeking a reduced amount of funding from the project's community treasury for 2026, submitting nine proposals totaling $46.8 million. This marks a substantial decrease from the $97.5 million requested in 2025. The proposals prioritize scaling the Cardano network to enhance its transaction processing capacity and expanding into Bitcoin DeFi. Cardano's community treasury, which is funded by network fees, is allocated through a voting process by community representatives. Input Output has historically been the largest recipient of these funds due to its significant role in developing the underlying software. However, the company now aims to reduce its dependency on community funds by decreasing its annual funding 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 firms like VacuumLabs and Midgard Labs that focus on specific layers of the Cardano software. The proposals are grouped into two main themes: scaling and Bitcoin DeFi integration. One of the key proposals 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 would position Cardano as a competitive network 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 significant proposal is for a system called Pogun, designed to bring Bitcoin-based decentralized finance to Cardano. This system would allow bitcoin holders to borrow and earn yield on their holdings through Cardano without relying on a centralized intermediary. Pogun's lending component is targeted for public release in the second quarter. Smaller proposals focus on performance improvements 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 a staged release of funds based on the completion of project components. The voting process, which begins on Tuesday and runs through May 24, will be decided by approximately 1,000 elected delegates known as DReps, who represent ADA holders. The outcome of the vote will indicate whether Cardano's governance treats Input Output like any other grant applicant or continues to approve its requests based on historical precedence. Last year's $97.5 million proposal was approved, but the governance landscape has changed 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 ecosystem progress, including the launch of a new Cardano stablecoin, USDCx, which reached 14.6 million tokens in circulation within weeks, and an increase in total assets deposited on Cardano from $137.5 million to $142.7 million. The result of the vote will signal how the Cardano community's perspective has evolved, particularly in regards to funding development without relying on Input Output.