Cardano Developer Requests 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 worth $46.8 million for 2026, marking a notable reduction from the $97.5 million requested in 2025. Several of these proposals focus on enhancing Cardano's scalability and expanding its presence in the Bitcoin DeFi space. Cardano, similar to other major blockchains, maintains a communal fund fueled by network fees, which is allocated by community representatives through a voting process. Historically, Input Output has been the primary recipient of these funds due to its significant role in developing the underlying software. However, the company is now working to reduce its reliance on community funding, aiming to eventually sustain itself through its own revenue. This reduced funding request is the first step towards achieving this goal, with plans to decrease the annual request until community funds can be redirected towards supporting a broader range of smaller engineering teams. By the end of 2026, Input Output anticipates that smaller, specialized teams will 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 can be grouped into two primary themes: scaling and Bitcoin DeFi integration. The largest proposal funds the development of Leios, a consensus upgrade that promises to significantly increase Cardano's transaction processing capacity, potentially reaching over 1,000 transactions per second. This would position Cardano as a competitive force alongside Solana and the fastest Ethereum layer-2 networks in terms of throughput. Leios is scheduled for a test release in June, with full deployment expected by the end of the year. The second major proposal involves the development of Pogun, a system designed to introduce Bitcoin-based decentralized finance to the Cardano ecosystem. This system would enable bitcoin holders to borrow and earn yield on their holdings through Cardano without needing to rely on centralized intermediaries. Pogun's lending component is targeted for public release in the second quarter. Additional proposals cover a range of improvements, including 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 the achievement of milestones, rather than releasing funds upfront. The voting process, which opens 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 this vote will test whether Cardano's governance treats Input Output as any other grant applicant or continues to approve its requests based on historical precedence. Last year's $97.5 million proposal was approved, but significant changes have occurred since then, including the Cardano Foundation taking over the project's grant-funding arm and Intersect assuming stewardship of core Cardano software. These shifts mean that alternatives to Input Output now exist, potentially influencing the voting outcome. Input Output also highlighted recent progress in 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 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 light of the existence of tools that enable development funding without reliance on Input Output.