Input Output (IO), the primary engineering firm behind the Cardano blockchain, has submitted a significantly reduced funding request of $46.8 million from the project's community treasury for 2026. This marks a sharp decrease from the $97.5 million it requested and received in 2025, representing the first concrete step in a plan to phase out its financial dependency on the treasury.
The company filed nine proposals, which group into two main themes: scaling the network and expanding into Bitcoin decentralized finance (DeFi). The largest proposal funds a consensus upgrade called Leios, which Input Output claims will increase Cardano's transaction processing capacity by 10 to 65 times, targeting over 1,000 transactions per second. This would position Cardano's throughput to be competitive with networks like Solana and fast Ethereum layer-2s. Leios is scheduled for a test release in June 2026, with full deployment targeted by year-end.
The second flagship proposal funds a system called Pogun, designed to bring Bitcoin-based DeFi to Cardano. This would allow Bitcoin holders to borrow and earn yield on their holdings directly through Cardano without using a centralized custodian, with a lending component targeted for public release in Q2 2026.
Other proposals cover performance improvements to Cardano's smart contract engine (Plutus), security testing, developer tools, and API services. Funding is tied to delivery milestones rather than upfront payments. Input Output stated its aim is to shrink its annual request each year until it can sustain itself on its own revenue, with community funds eventually flowing to a broader set of smaller, specialized engineering teams like VacuumLabs and Midgard Labs.
The vote, which opens on April 23 and runs through May 24, will be decided by roughly 1,000 elected delegates (DReps) representing ADA holders. This vote is seen as a test of Cardano's evolving governance, as alternatives to Input Output now exist following the Cardano Foundation taking over grant-funding and Intersect assuming stewardship of core software. Founder Charles Hoskinson is scheduled to release a video making the case directly to delegates.
Meanwhile, Input Output cited ecosystem progress, noting that a new Cardano stablecoin, USDCx, reached 14.6 million tokens in circulation shortly after launch, and total value locked (TVL) on Cardano rose from $137.5 million to $142.7 million.
