Cardano Foundation’s Approach to Budget Proposal Evaluations

A proposal review process built on comprehensive considerations

The Cardano budget process pioneered by Intersect has undergone a recent change, aiming to introduce a more participative process focused on Delegated Representatives (DReps). The updated budgeting process pivoted to allow for budget proposal submissions from a diverse range of submittors. This has led to a broad spectrum of proposals, ranging from local community initiatives to large-scale projects aiming to shape the future roadmap of Cardano. This approach presents challenges in maintaining coherence and strategic focus. The Foundation’s aim is to actively participate in governance processes as the community strives to establish a budgeting process, and it shares these challenges as a community participant. The Foundation has developed a framework for its evaluation of budget proposals as a DRep, set out further below.

Our evaluation framework

As a DRep, the Cardano Foundation remains committed to a transparent and structured approach in assessing budget proposals. Our evaluation of budget proposals as a DRep is anchored in the following principles:

• •Scope and Strategic Alignment: We prioritize proposals that align with the Cardano 2025 Vision & Roadmap and adhere to the ecosystem principles outlined in Our Cardano. This approach ensures that initiatives contribute meaningfully to the ecosystem’s strategic objectives.
• •Committee Budget Proposals and Prior Feedback: Besides the Vision & Roadmap, we consider budget proposals submitted by Intersect committees. Our assessments incorporate prior feedback given by the Cardano Foundation on these proposals to ensure consistency and informed decision-making.
• •Financial and Funding Mechanics: The review process examines proposals for financial viability, encompassing a clear budget breakdown and cost justification. Specifically, we assess the feasibility of funding requests in relation to the project’s scope and potential impact.
• •Proposal Content and Execution Standards: We expect comprehensive details on objectives, deliverables, timelines, team expertise, and risk assessments. Proposals should demonstrate technical and operational feasibility, a track record where possible, clear success metrics, and adherence to reporting and accountability standards. We believe that recipients of Treasury funds should be accountable for the use of those funds and should deliver on their proposals.

Given the diverse nature of submissions, and the compressed timeline for the budget process, applying a uniform assessment framework is challenging. As such, we tailor evaluations to each proposal's specific context and nuances while maintaining consistency with our guiding principles.

A call to collaborative action

We encourage fellow DReps to develop and apply their own assessment frameworks when evaluating proposals. Establishing a criteria for proposal evaluation will enhance the effectiveness and transparency of each DRep’s individual decision-making processes.

Looking ahead, we further advocate for a more structured and clearly defined approach for the 2026 budget cycle, building on the learnings from the 2025 process. The Cardano Foundation is committed to engaging in these discussions, offering insights, continuing to provide resources to this development and contributing to the continuous improvement of our governance practices.

By working together, we can ensure that the budget proposal process remains inclusive, strategically aligned, and effective in advancing the Cardano ecosystem.

Nicolas Cerny
Governance Lead