What’s next for Cardano?

Cardano's evolution into a community-governed blockchain platform will enable a more inclusive and autonomous system. This milestone is the culmination of the platform’s foundational development phases – Byron (foundation), Shelley (decentralization), Goguen (smart contracts), Basho (scaling), and Voltaire (decentralized on-chain governance).

In his whiteboard video recorded in November 2024,  ‘After Voltaire, the next evolution of Cardano’, Charles Hoskinson, CEO of Input | Output (IO), proposed IO’s perspective on the next steps and reflected on the need for the Cardano community’s fundamental input in shaping a comprehensive roadmap.

In this new era of governance, Cardano’s roadmap will be driven by the community for the community. With this in mind, IO has submitted its proposal on what it views as development priorities to the Intersect product committee for appraisal and review. We believe that IO’s vision for Cardano’s roadmap reflects a clear and ambitious vision for the future of blockchain technology, with a focus on three defined pillars – scalability, usability and utility, and interoperability and extensibility. 

These pillars address the need to accommodate the technical demands arising from a growing user base, underpinning Cardano’s expected growth and its ability to support decentralized applications (DApps), smart contracts, and cross-chain interactions. By advancing in these areas, Cardano's infrastructure will adapt to meet the expansion of decentralized systems, enabling trust through transparent frameworks and solidifying its position as a leading platform for secure, scalable, and sustainable blockchain solutions.

Scalability

Cardano aims to support billions of users by 2030 by removing barriers to entry while maintaining decentralization, affordability, and security. The integration of advanced scaling solutions will enable high transaction volumes with a multi-faceted approach to achieving scalability goals through technologies such as:

• Layer 2 Hydra state channels: a scalability solution for Cardano, leveraging off-chain state channels to enable high-speed and low-cost transactions while maintaining the security of the mainnet. Hydra’s modular design allows future scalability advancements, including the development of the tail protocol and cross-head-and-tail communication. These innovations will enhance end-user access and support efficient off-chain interactions, forming a comprehensive scalability architecture.
• Layer 2 rollups (zero-knowledge (ZK) and optimistic): rollups aggregate multiple transactions into a single batch for validation, reducing network load while preserving security. Cardano aims to support optimistic rollups, which rely on on-chain dispute resolution, and ZK-rollups, which provide cryptographic proof for instant finality, leveraging advancements in PlutusV3 for cryptographic primitives.
• Ouroboros Leios and Peras: Leios is a next-generation consensus protocol designed to enable high-speed transaction processing through parallel block creation, addressing scalability without compromising security. Peras complements Leios by reducing finality times from 12 hours to two minutes, enabling faster settlement and interoperability.
• Mithril certificates: Mithril’s lightweight cryptographic protocol allows nodes and light clients to verify and exchange data without running a full node. Certificates support fast node bootstrapping, complement layer 2 solutions like Hydra, and lay the groundwork for decentralized data services and future ZK-proof integrations.
• Data API services: enable developers to access blockchain data and submit transactions without running a full node. Cardano’s approach emphasizes decentralization and plans to enable stake pool operators (SPOs) and desktop clients to serve as distributed data providers, reducing reliance on centralized operators.
• Local node services and Daedalus: the new local node service in the works is planned to replace Daedalus, offering a lightweight, full-node experience for users who want direct, trustless access to Cardano’s blockchain. This service will minimize storage requirements while supporting decentralization and compatibility with existing wallets that use data API services.
• Catalyst voting platform: Catalyst supports decentralized funding for Cardano projects, with over $125m allocated to more than 2,000 initiatives. Upcoming enhancements include replacing Web2 tools with decentralized systems for proposal management, privacy-preserving voting, and improved compliance while introducing features like liquid democracy.
• Core node improvements: proposed upgrades to Cardano’s core node include adopting log-structured merge (LSM) trees, revising stake pool incentive schemes, implementing anti-grinding measures, and introducing tiered pricing. These changes will improve node stability, reduce costs, and enhance scalability.

Cardano’s multi-layered scalability strategy supports both high-throughput applications (such as gaming and micropayments) and large-scale infrastructure projects like decentralized physical infrastructure networks (DePIN), including global mobile networks. By prioritizing decentralization alongside scalability, Cardano will preserve the network’s integrity and ensure its accessibility by a diversified and ever-growing user base.

Usability and utility

To drive widespread adoption, it is essential that blockchain technology becomes accessible for everyday use. Cardano is committed to decentralization as a core principle, addressing usability challenges without compromising this foundational value – a stark contrast to a focus on centralization elsewhere in the industry.

Achieving this vision requires native support for key functionalities: identity, privacy, and regulatory compliance. Identity frameworks enable trusted transactions, governance, and regulatory alignment. Privacy must balance user control with transparency. Also, integrating fragmented regulatory frameworks into blockchain systems presents challenges that must be addressed without compromising decentralization. 

Key initiatives supporting the usability and utility pillar include:

• Improving developer productivity: Cardano supports multiple programming languages and focuses on tools like static analyzers, formal verification methods, and a container-based development environment for efficient contract development and verification, making smart contract development more accessible and cost-efficient. Upcoming initiatives include advancements in Plinth (formerly PlutusTx), Plutus High Assurance, Aiken, and plu-ts, enhancing developer experiences across diverse skill levels.
• Enabling identity with Hyperledger Identus: Identus integrates decentralized identity management and credential systems, empowering users to control their personal information. Combined with the Lace wallet, Identus can support regulatory requirements and seamless user interactions with claims and credentials, laying the groundwork for future decentralized identity use cases.
• Enhancing privacy through Midnight: Midnight, Cardano’s first partner chain, introduces data-protecting smart contracts using ZK proofs. It supports developers with compact TypeScript syntax for managing public and private data fields, while Cardano’s SPOs secure the network. Midnight is poised to enhance privacy and scalability across blockchain ecosystems.
• Simplifying transactions via Babel fees: the introduction of Babel fees will enable users to pay transaction costs using any token, removing the reliance on ada. This feature supports cross-network integration, such as with Midnight, by allowing seamless transaction settlement in native tokens, making blockchain interactions easier for all users.

Cardano’s commitment to usability and utility will ensure a robust, accessible platform that empowers developers to build innovative, cross-chain applications and high-assurance smart contracts while fostering a great user experience.

Interoperability and extensibility 

Extending Cardano's capabilities will unlock its potential for interoperability. Traditional bridges face security challenges, such as attacks and wrapped tokens. Therefore, interoperability requires more than what bridges offer today. Currently, Cardano is making significant progress in the development of inter-blockchain communication protocol (IBC) and other bridges. Additionally, to address security challenges, the partner chains framework aims to provide innovative approaches such as multi-resource consensus, service layers, and hybrid DApps.

Realizing this vision requires a flexible node architecture to support rapid development, alternative clients, and Cardano’s role as the settlement layer. The goal is seamless integration with Bitcoin, enhancing the value of Cardano’s smart contracts and connecting to Bitcoin’s $1.7tn value.

In our view, the third pillar requires the following initiatives:

• Cardano: layered node architecture with microservices. Cardano will benefit from adopting a polyglot, microservices-based architecture to improve scalability, flexibility, and developer accessibility, enabling faster development and integration of new features while maintaining compatibility with existing code. This approach supports multiple programming languages and modular components, enhancing Cardano’s ability to scale efficiently.
• Partner chains: multi-resource consensus with Minotaur. Minotaur, a new consensus mechanism, aims to enable trustless interoperability between Cardano and other networks by leveraging mixed resources for higher security and seamless integration. The technology supports gradual migration to local validators and can enable trustless interoperability with other networks like Ethereum.
• Partner chains: extensibility through service layers. Partner chains will allow blockchain networks to interact through decentralized service layers, enabling cross-chain transactions without requiring token bridging. This enhances interoperability and allows networks to provide services to others while maintaining decentralization, as demonstrated by Midnight, which offers data protection services.
• Partner chains: cross-chain transactions via Hybrid DApps. Hybrid DApps will allow users to create complex, trustless multi-chain transactions without requiring developer involvement in bridging. These DApps can leverage Minotaur and threshold signatures to ensure atomic, cross-chain transactions, allowing users to interact with multiple blockchains seamlessly.
• Cardano as the smart contract layer for Bitcoin. Cardano can potentially become the smart contract and DeFi layer for Bitcoin, integrating both networks to unlock new capabilities and liquidity. Plans for 2025 include evaluating merged mining and enabling Bitcoin users to interact with DeFi on Cardano and execute private transactions using Midnight.

In the era of decentralized decision-making, the collective input of the community and the expertise of developers across the ecosystem will shape Cardano's future direction. IO’s outlook for Cardano’s roadmap emphasizes a bold and forward-thinking approach to blockchain innovation, prioritizing scalability, user accessibility, and seamless interoperability. By driving progress in these key areas, Cardano can continue to build on its strong foundation for sophisticated decentralized applications, enable secure interactions across different blockchain networks, and foster widespread adoption across many sectors.

You can read the full text of IO’s proposed roadmap here and participate in the Cardano Forum discussions.