Cardano’s Governance Revolution: Community Votes on Budget Cuts and a 65x Speed Boost

Cardano shifts to community governance as 1,000 delegates vote on $46.8M IOG budget and Leios upgrade, targeting 1,000 TPS and Bitcoin DeFi integration.

The Cardano ecosystem is undergoing a fundamental power shift. For the first time, the project’s core development firm, Input Output Global (IOG), is not setting its own budget. Instead, roughly 1,000 elected delegates are voting on nine proposals that will determine the network’s financial and technical direction for the coming year. The voting window closes on May 24.

IOG has requested just $46.8 million from the community treasury for 2026 — a 50% reduction from the previous year. This marks a deliberate strategic pivot as the organization hands over control to token holders. The vote is widely seen as the most consequential governance decision in Cardano’s history.

The administrative body Intersect has also completed a fiercely contested election. From more than 100 candidates, 37 representatives were chosen to oversee decentralized governance. The results were announced in recent days.

Leios Testnet Set for June as Throughput Targets Sharpen

At the heart of the funding proposals is the Ouroboros Leios consensus upgrade. Preliminary simulations indicate a 10- to 65-fold increase in transaction speed, bringing the network tantalizingly close to the 1,000-transactions-per-second milestone. A testnet launch is scheduled for June, with a potential mainnet deployment by year-end.

Cardano founder Charles Hoskinson pushed back against critics who accuse the network of neglecting technical progress in favor of governance reforms. He insisted that development of the Leios and Peras scaling protocols has continued steadily through a research-driven approach. Hoskinson also noted that such deep system changes now require formal community approval — a more democratic but slower process.

Alongside Leios, the ledger team is preparing the “van Rossem” hard fork, slated for the summer. It will introduce protocol version 11, promising enhanced network security and optimized performance. By the end of the year, smaller specialized teams are expected to take over most of IOG’s internal development work. The long-term ambition is staggering: Cardano aims to scale its monthly transaction volume from under one million to over 27 million.

Bitcoin DeFi Ambitions and Ecosystem Growth

Beyond infrastructure, the network is pushing into cross-chain finance. The so-called “Pogun” initiative proposes integrating Bitcoin-based lending markets into Cardano’s infrastructure. Through the privacy-focused sidechain Midnight, Bitcoin holders would be able to participate in decentralized finance without moving their original assets to another blockchain. If approved, cross-chain transactions would be settled in ADA, potentially creating a new demand driver for the token. The proposal is currently before delegates, with the voting deadline also on May 24.

On the application side, the Lace 2.0 wallet now serves as a gateway to the Bitcoin ecosystem. Meanwhile, the new stablecoin USDCx has quickly reached a circulation of 14.6 million tokens, and total value locked on Cardano has edged up to $142.7 million.

Price Action Lags as Technical Picture Improves

Despite the flurry of activity, ADA’s market performance remains subdued. The token changed hands at $0.27 on Wednesday, up nearly 9% on the day after breaking above its 50-day moving average of $0.25. Traders are now attempting to establish that level as a new support zone.

But the broader picture is less encouraging. ADA is still trading well below its 200-day moving average and has lost roughly 24% year-to-date. The secondary article pegs the decline at nearly 27%, with the token at $0.26 — the discrepancy likely reflecting different measurement periods.

A potential catalyst looms in mid-May, when the U.S. Senate Banking Committee is expected to revise the CLARITY Act. The legislation would create a binding legal framework for Layer-1 assets in the United States, which could provide regulatory clarity for Cardano and its peers.

The coming weeks will deliver hard evidence for the network. By May 24, the community will have voted on the development budget. If the Leios testnet and van Rossem hard fork proceed as planned in June, the protocol must prove that its promised performance leaps hold up in practice.