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 approximately half the funding it sought in the previous year from the project's community treasury. The organization has submitted nine proposals totaling $46.8 million for 2026, down from $97.5 million in 2025. Several proposals focus on enhancing Cardano's scalability to increase its transaction processing capacity and expanding into Bitcoin DeFi. Cardano, like other major blockchains, has a shared fund fueled by network fees, which community representatives vote to allocate for development work. Input Output has historically been the largest recipient of this funding due to its significant role in employing engineers who build the underlying software. However, the company now aims to reduce its annual funding request until it can sustain itself through its own revenue, allowing community funds to support a broader range of 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 proposals are grouped into two main themes: scaling and Bitcoin DeFi. The largest proposal funds the Leios consensus upgrade, 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 major proposal supports the development of Pogun, a system designed to bring 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 enhancements to Cardano's smart contract engine, security testing infrastructure, developer tools, and expanded API services. Each proposal specifies delivery leads and ties funding to delivery milestones rather than releasing funds upfront. Voting on these proposals begins on Tuesday and will run through May 24, with decisions made by roughly 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 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 alternatives to Input Output now exist, which may influence the voting outcome. Input Output also highlighted progress in the ecosystem, 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.