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## Recalibrating Cardano’s Budget Process: We’ve heard you
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Cardano’s budget process is new and evolving, and we recognize that the first year will not be perfect. There have been challenges; at times, the process has been more complex than necessary. Based on community feedback, we are making, and will continue to make, necessary adjustments, including:
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* Continue building on the work members have contributed to the draft budget proposals.
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* Leverage Cardano’s technology, including smart contracts and distributed oversight, to set a strong precedent for transparent governance.
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Recognizing that governance is an ongoing process, we will remain agile and responsive to further community feedback. 
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Recognizing that governance is an ongoing process, we will remain agile and responsive to further community feedback.
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#### The revised approach - closer adherence to the Cardano Constitution
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## Changes to how providers are selected
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Ecosystem builders and the broader community can now submit proposals directly alongside committee budgets being submitted as block budgets. This allows vendors and builders to identify specific parts of the roadmap or other ecosystem needs they wish to develop or support and propose a targeted request for DRep consideration within the budget proposal(s).
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“The Cardano Community is expected to periodically propose one or more budgets for the ongoing operation, maintenance, and future development of the Cardano Blockchain ecosystem and for covering other costs related to the implementation, administration, and maintenance of the decentralized, on-chain governance processes provided for in this Constitution.” 
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“The Cardano Community is expected to periodically propose one or more budgets for the ongoing operation, maintenance, and future development of the Cardano Blockchain ecosystem and for covering other costs related to the implementation, administration, and maintenance of the decentralized, on-chain governance processes provided for in this Constitution.”
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–Article 4, section 1 of the Cardano Constitution.
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### Fund management
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The revised process also includes changes to how approved funding with Intersect listed as the administrator will be disbursed. Intersect is sponsoring the writing of a new smart contract with multiple oversight signers to provide the necessary checks and balances to funding disbursements and provide greater stability to vendors. More importantly, it provides far greater transparency with fund disbursements, with the community able to self-audit. 
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The revised process also includes changes to how approved funding with Intersect listed as the administrator will be disbursed. Intersect is sponsoring the writing of a new smart contract with multiple oversight signers to provide the necessary checks and balances to funding disbursements and provide greater stability to vendors. More importantly, it provides far greater transparency with fund disbursements, with the community able to self-audit.
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[SundaeLabs](https://sundae.fi/) and [Xerberus](https://www.xerberus.io/) are developing the smart contract. The multi-sig smart contract will include Intersect, along with auditors and established organizations to be selected. The smart contract will serve as an oversight control mechanism, with the ability to pause payments to vendors for just cause, such as contract breaches. 
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[SundaeLabs](https://sundae.fi/) and [Xerberus](https://www.xerberus.io/) are developing the smart contract. The multi-sig smart contract will include Intersect, along with auditors and established organizations to be selected. The smart contract will serve as an oversight control mechanism, with the ability to pause payments to vendors for just cause, such as contract breaches.
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“Development of Cardano Blockchain ecosystem budgets and the administration of such budgets shall utilize, to the extent possible and beneficial, smart contracts and other blockchain based tools to facilitate decision-making and ensure transparency. ” 
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“Development of Cardano Blockchain ecosystem budgets and the administration of such budgets shall utilize, to the extent possible and beneficial, smart contracts and other blockchain based tools to facilitate decision-making and ensure transparency. ”
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– Article 4, section 2 of the Cardano Constitution
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## Oversight and Administrator role
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As an administrator and oversight body, Intersect, through its members and committees, will provide guidance and recommendations in an advisory capacity on approved vendors and contracts, and support the ongoing development of roadmaps (and supporting initiatives). This also includes reporting on milestones, financial updates, and arbitration (as needed) on a timely basis to the community, and more directly to the smart contract holders.
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“Cardano Blockchain budgets shall specify a process for overseeing use of funds from Cardano Blockchain treasury withdrawals including designating one or more administrators who shall be responsible for such oversight.” 
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– Article 4, section 2 of the Cardano Constitution.\
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“Cardano Blockchain budgets shall specify a process for overseeing use of funds from Cardano Blockchain treasury withdrawals including designating one or more administrators who shall be responsible for such oversight.”
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– Article 4, section 2 of the Cardano Constitution.\\
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## The Net-Change-Limit
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A critical factor in budget discussions is the Net Change Limit (NCL)—a constitutional mechanism that determines how much ADA can be withdrawn from the Treasury within a set period. The community is currently evaluating two possible approaches: a percentage-based limit or a fixed numeric cap. The outcome of this decision will shape how Treasury resources are allocated, making open discussion and community alignment essential. The Intersect Budget Committee will continue to facilitate this process, ensuring all perspectives are considered. The NCL proposal is expected to be submitted on-chain towards the end of March.
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The Treasury is designed to support Cardano's ongoing growth and development. Any spending plan should account for treasury increase projections, balancing investment in growth-oriented development with long-term financial sustainability. 
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The Treasury is designed to support Cardano's ongoing growth and development. Any spending plan should account for treasury increase projections, balancing investment in growth-oriented development with long-term financial sustainability.
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**Reaching commonality on Cardano’s technical & product roadmap**
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**If you’re a vendor or ecosystem builder:**
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* You may now submit proposals directly rather than relying solely on committee-prepared block budgets.
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* Submissions open in early March. The Cardano community and DReps - supported by the appropriate Intersect committees - will then review all proposals for funding.
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* Submissions open in early March. The Cardano community and DReps - supported by the appropriate Intersect committees - will then review all proposals for funding.
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* If selected and using Intersect as your administrator, funding will be managed via a multi-signature smart contract, ensuring transparency and stability.
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# Budget Glossary
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{% include "../../../.gitbook/includes/this-page-has-been-archived.md" %}
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***Budget / Cardano budget**
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* A budget for Cardano’s treasury. Withdrawals cannot be made without a budget in place.
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***Budget info action**
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* Official on-chain approval of Cardano’s budget, submitted as an info action for DReps and the Constitutional Committee to vote.
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***Cardano budget submission process / 2025 budget process / Budget process**
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* The steps to arrive at an approved Cardano budget for 2025. 
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* The steps to arrive at an approved Cardano budget for 2025.
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***Cardano Development Holdings (CDH)**
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* A trust to fund and facilitate the ongoing maintenance, development, and growth of the Cardano ecosystem. It receives funds from the Cardano treasury where Intersect would then manage contracting, payments, reporting etc. as the administrator.
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***Cardano Constitution**
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* A role in the Cardano ecosystem whose job is to vote on-chain, indicating the constitutionality of a proposed governance action to be implemented.
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***DRep (Delegated Representative)**
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* A role in the Cardano ecosystem whose job is representing the community’s opinion through an on-chain vote. Ada owners may select a DRep to vote on their behalf. DReps must approve the Net Change Limit, budget, and treasury withdrawals.
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***Governance support (as a budget category)**
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***Governance support (as a budget category)**
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* Provides resources for governance structures, including DReps and Constitutional Committee activities, to uphold Cardano's decentralized governance.
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***Marketing (as a budget category)**
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* Promotes Cardano through marketing, educational programs, community engagement, and global outreach to expand adoption and understanding.
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* In 2024 and early 2025, the Intersect committees created draft budgets based on their expertise. These are being used as guidance to help DReps understand and compare proposals submitted to receive treasury funds.
* These terms refer to requests for treasury funds. These are being submitted through a single form at [https://www.intersectmbo.org/cardano-budget-submission](https://www.intersectmbo.org/cardano-budget-submission). They specify proposed work, the amount of ada requested from the treasury to fund the work, and the delivery team. DReps will prioritize and aggregate proposals to create line items in the budget.
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***Proposers / Vendors** 
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***Proposers / Vendors**
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* A general term for a group, organization, entity, or individual who has submitted a proposal to receive treasury funds.
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***Reconciliation / Reconciliation workshops**
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* Reconciliation is a special process used in the US Government to make changes to and pass the budget. In the 2025 budget process for Cardano, the term reconciliation describes the process of finalizing changes to the Cardano budget. It will include selecting between competitors, earmark funds for all of the critical ecosystem activities, and generally approving a draft budget to be put on-chain for voting.
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# Budget Info Action FAQs
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**Important note:** Greater than 50% of active delegated DRep stake is required to pass a Budget Info Action. This does not result in the movement of any funds from the Cardano Treasury. If approved, it marks the next step toward funding, with Treasury Withdrawal governance actions required to be passed and enacted.\
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**Important note:** Greater than 50% of active delegated DRep stake is required to pass a Budget Info Action. This does not result in the movement of any funds from the Cardano Treasury. If approved, it marks the next step toward funding, with Treasury Withdrawal governance actions required to be passed and enacted.\
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These withdrawals require a higher threshold of over 67% DRep approval to release funds from the Cardano Treasury.
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This action does not release funds - it authorizes the proposed allocation as a whole. Once approved, individual Treasury Withdrawal Actions must be submitted to release funds, subject to further approval and within the limits of the active Net Change Limit (NCL).
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<details>
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<summary>Why do we have an omnibus budget proposal instead of individual requests?</summary>
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<summary>How does Intersect manage funding and associated risks?</summary>
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 Intersect’s role as an Administrator is to provide oversight, coordination, and accountability for the proposals that have requested it. Intersect does not manage or hold Treasury funds directly - those are released through approved governance actions and, where applicable, distributed via smart contracts or authorized accounts.
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Intersect’s role as an Administrator is to provide oversight, coordination, and accountability for the proposals that have requested it. Intersect does not manage or hold Treasury funds directly - those are released through approved governance actions and, where applicable, distributed via smart contracts or authorized accounts.
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To help manage associated risks and ensure responsible use of Treasury funds, Intersect applies the following safeguards:
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<summary>What if a project goes bust or fails to deliver? What happens to the funds?</summary>
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 If a funded project fails to meet its obligations or goes bust, several safeguards are in place to protect Treasury resources:
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If a funded project fails to meet its obligations or goes bust, several safeguards are in place to protect Treasury resources:
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1. Pause or stop disbursements:\
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Intersect, working with oversight partners, can pause further payments if a project breaches its contract or misses key deliverables.
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3. Milestone-based or conditional payments:\
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Where applicable, funding is released in phases tied to verifiable progress. This limits exposure in the event of non-delivery.
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4. Oversight and reporting:\
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Intersect and elected committees monitor delivery across proposals. Issues are flagged early to reduce risk and ensure transparency.\
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Intersect and elected committees monitor delivery across proposals. Issues are flagged early to reduce risk and ensure transparency.\\
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In short, funds are not handed over in full at once. If a project fails, any unspent or unearned funds can be recovered or withheld, helping safeguard the Treasury and community interests.
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<details>
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<summary>What assurance is there that Intersect won't misuse its role or become too powerful?</summary>
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<summary>What assurance is there that Intersect won't misuse its role or become too powerful?</summary>
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Intersect’s authority comes from the community. It does not control funds, cannot approve Treasury withdrawals on its own, and is accountable to both DReps and the Constitutional Committee.
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