Cardano Developer Seeks Reduced Funding of $46.8 Million for Expansion and 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 company has submitted nine proposals totaling $46.8 million for 2026, marking a decrease from the $97.5 million requested in 2025. These proposals focus on enhancing Cardano's scalability to increase its transaction capacity and exploring the integration of Bitcoin DeFi. Cardano's community treasury, funded by network fees, is allocated 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 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 engineering teams to take over most of its current in-house work, including collaborations with firms like VacuumLabs and Midgard Labs. The proposals are centered around two main themes: scaling and Bitcoin DeFi. The first theme involves a consensus upgrade called Leios, which is expected to increase Cardano's transaction processing capacity by 10 to 65 times. This upgrade aims to make Cardano competitive with other major blockchains in terms of throughput. The second theme involves a system called Pogun, designed to bring Bitcoin-based decentralized finance to Cardano, allowing bitcoin holders to borrow and earn yield without relying on centralized intermediaries. Smaller proposals address performance improvements, security testing, developer tools, and API services. Each proposal outlines specific delivery leads and ties funding to delivery milestones. The voting process, which opens on Tuesday and runs through May 24, will be decided by roughly 1,000 elected delegates representing ADA holders. The outcome of this vote will indicate whether Cardano's governance treats Input Output as any other grant applicant or continues to approve its requests based on historical deference. Meanwhile, the Cardano ecosystem has seen progress, with a new stablecoin, USDCx, reaching 14.6 million tokens in circulation and total assets deposited on Cardano rising to $142.7 million.