How the Cardano Foundation Reviews Budget Proposals in 2026

In January 2026, the Cardano Foundation expanded its delegation program by delegating an additional 220 million ada to 11 delegated representatives (DReps), bringing total community delegation to 360 million ada. That decision was a signal: governance works best when voting power is distributed and exercised responsibly.

The Cardano Ecosystem Budget Process facilitated by Intersect is where all community members’ governance responsibility gets tested. The process begins when budget proposals, submitted via Intersect’s Hydra-voting tool, request funding. At this stage, a submitted proposal is not an actual on-chain governance action, it is an idea put forward for feedback, iteration, and improvement before off-chain Hydra voting begins. After input is received, and off-chain voting concluded, proposals showing strong indications of community support will be submitted for on-chain voting in two Treasury Withdrawal governance actions (“TW”), sorted based on the approval they received off-chain. Proposals receiving ≥67% to <75% will be submitted in one TW, and proposals receiving ≥75% will be submitted in another. If DReps vote in favour of a TW, it will pass. The stakes are real, for a proposal to pass it means that ada leaves the Treasury, work gets funded, and the ecosystem's direction shifts accordingly.

Last year, we shared our approach to navigating budget proposal assessment, outlining how the Foundation evaluates proposals and what principles guide our DRep vote. The 2025 cycle taught us a great deal. The process was ambitious, the proposal volume high, and the tooling still maturing. We committed to bringing the same structure and transparency to 2026.

This post outlines what we built.

The 2026 Review Framework

The Foundation's review process is designed around three objectives:

• reduce reviewer burden through efficient filtering,
• ensure consistency via structured scoring,
• and maintain a full audit trail from proposal intake through on-chain votes.

Every proposal submitted to the Hydra-voting tool is imported into our internal assessment system, assigned and scored independently on three criteria by at least two internal reviewers with relevant pillar expertise.

Assessment Criteria

We evaluate proposals across three categories:

1. Ecosystem Growth: Cardano's long-term sustainability depends on utility, not speculation, therefore this criterion asks if the proposal will generate meaningful on-chain activity, and if it drives real usage of the Cardano network.
2. Budget Feasibility: We evaluate if the requested funding is proportionate to expected deliverables, if the budget breakdown is reasonable and well-justified, and if there are cheaper alternatives.
3. Vision and Strategy Alignment: We assess if the proposal supports the Cardano 2030 Strategy framework, and if it is consistent with the principles outlined in Our Cardano.

In addition, reviewers are asked to assess whether the proposal's output will be open-source, identify any feasibility concerns, and verify if the proposer received Cardano ecosystem funding in 2025, including whether they successfully delivered on those past commitments.

Strategic Pillars

Proposals are evaluated against five strategic pillars derived from the Cardano 2030 Strategy:

1. Infrastructure & Research Excellence: Keep Cardano secure, fast, and interoperable so it can host more economic activity.
2. Adoption & Utility: Driving widespread, non-speculative utility by focusing on high-value industry verticals, superior user experience (UX), and enterprise-grade security.
3. Governance: Cardano governance must be hard to capture, easy to use, and paced. This builds directly on Cardano’s tripartite model of DReps, Constitutional Committee, and SPOs.
4. Community & Ecosystem Growth: Driving global engagement through a market-centric approach, cultivating a skilled developer base, and proactively demonstrating ecosystem value.
5. Ecosystem Sustainability & Resilience: Ensuring the long-term financial health and operational integrity of the network infrastructure.

Reviewers are assigned to proposals based on their pillar expertise. Each proposal receives a minimum of two independent reviews.

If our reviewers disagree on a proposal, a third reviewer acts as a tie-breaker. We don’t seek consensus merely for its own sake and we encourage rigorous debate amongst our internal governance team and reviewers. This promotes diverse views and encourages thorough voting.

From Review to Vote

Following review, internal recommendations are finalised into three votes: Yes, No and Abstain. The governance page on the Foundation’s website provides a complete outlook of our Governance Advisory Team process.

Internal approvals, our team executes the votes directly in the Hydra voting tool. Once the TWs are submitted on-chain by Intersect, we will vote as a DRep. To ensure transparency, we will subsequently publish a follow-up blog post containing a comprehensive document that details all our final voting decisions and their accompanying rationales.

What We Learned from 2025

The 2025 budget process was the first of its kind. A diverse range of applicants brought a broad spectrum of proposals – a positive development that also introduced complexity. The Foundation advocated then for a more structured and clearly defined approach and made contributions along these lines via the Budget Committee. The 2026 cycle reflects those lessons:

• structured scoring replaces narrative-only assessments: Likert scales with rationale text makes reviews comparable across proposals and reviewers;
• pillar-based assignment ensures domain expertise: a governance reviewer evaluates governance proposals, while an infrastructure reviewer evaluates infrastructure proposals, and so on and so forth;
• change detection keeps reviews current: proposals that change materially on the Hydra platform after initial review are flagged for re-assessment so reviewers don't vote on stale information;
• 2025 delivery tracking adds accountability: for proposers who received funding last year, reviewers can see if they delivered.

Transparency as a Principle

The updated criteria and process are now public. This, however, is just the first step.

As part of our commitment to transparency, we will publish another article to make our positions and reasoning for the Hydra platform proposals fully accessible to the community. The Cardano Foundation believes that principled, transparent governance requires showing the underlying reasoning for each decision, not just the votes. This standard applies to us as much as it does to any other DRep in the ecosystem.

What Comes Next

With the proposal window now open, the Foundation's team is actively evaluating both formal submissions and direct on-chain treasury withdrawals. Although the final volume of active governance actions and proposal submissions remains to be seen, we intend to review and provide feedback on as many as possible.

We urge all proposers to submit clear, well-justified proposals aligned with the Cardano 2030 Strategy.

To our fellow DReps, we ask you to engage deeply with the budget process. Evaluate proposals independently, and publish your own rationales to show the depth and richness of your evaluation. It will not only foster conversations, but help others deliberate.

Governance is a shared responsibility. The budget process makes that responsibility not just tangible, but actionable.