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 requesting roughly half the funding it sought last year from the project's community treasury. The company has submitted nine proposals totaling $46.8 million for 2026, down from $97.5 million in 2025, with several focusing on increasing Cardano's transaction capacity and expanding into Bitcoin DeFi. Cardano, like other major blockchains, has a shared pool of funds allocated by network fees, which community representatives vote to allocate for development work. Input Output has historically 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 annual funding requests until it can sustain itself on its own revenue, allowing community funds to support smaller engineering groups. By the end of 2026, Input Output expects smaller teams to take on most of its current in-house work, including firms like VacuumLabs and Midgard Labs that specialize in specific layers of the Cardano software. The nine proposals fall into two main categories. The first funds a consensus upgrade called Leios, which is expected to increase Cardano's transaction processing capacity by 10 to 65 times, targeting over 1,000 transactions per second. This would position Cardano as a competitive chain, comparable to 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. The second flagship proposal supports a system called Pogun, aimed at bringing Bitcoin-based decentralized finance to Cardano. This system 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 targeted for public release 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 outlines specific delivery leads and ties funding to delivery milestones, rather than releasing funds upfront. Voting on these proposals opens on Tuesday and runs through May 24, with decisions made 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. Last year's $97.5 million proposal was approved, but since then, the Cardano Foundation has taken over the project's grant-funding arm, and Intersect has assumed stewardship of core Cardano software, providing alternatives to Input Output. 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 outcome of the vote will signal how much the Cardano community's perspective has shifted now that tools to fund development without Input Output exist.