Cardano Foundation Responds to Criticism Over Project Catalyst Involvement

Highlights:

• The Cardano Foundation has clarified its role in Project Catalyst voting and governance.  
• The Foundation has committed to more transparency and clearer voting criteria for the future.  
• Low community participation in Catalyst voting remains a major challenge for Cardano’s governance.

The Cardano Foundation has responded to recent concerns surrounding Project Catalyst. Over the past few weeks, these concerns have grown with critics alleging internal conflicts. They also expressed concern over the project relationship with Cardano founder Charles Hoskinson. In addition, the Foundation has come under question for its role in the Catalyst Fund 13. The foundation had a major voting stake of 180 million ADA tokens.

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— Cardano Feed ($ADA) (@CardanoFeed) December 16, 2024

On December 16, the Foundation released a blog post and FAQ in response. The report was intended to help clarify its position and explain its actions. The post was written to address growing questions from the Cardano community on their participation in key decisions.

Clarifying Role in Governance

The Foundation noted that it has been an active participant in Project Catalyst since 2021. Its vision has always been to enable Cardano’s decentralization, governance, and sustainability. 

The Foundation made it clear that, for Funds 12 and 13, its voting decisions focused on long-term priorities. It said that its selected projects address these goals. The Foundation considers these principles critical in helping Cardano to grow and prosper.

The Foundation acknowledged the challenges it faced during the voting process. It noted that voter participation in Catalyst is still low. Out of the 35 billion ADA in circulation, only 4.8 billion ADA were registered to vote. The Foundation’s 180 million ADA stake accounts for just 3.75% of the registered voting power and only 0.5% of the total ADA supply. 

Catalyst Challenges and Participation

The Foundation also addressed concerns about the overall participation in Catalyst. It pointed out that many stakeholders are not voting on all proposals. Even good proposals do not have the support they need. 

The Foundation has also expressed concern that the system might not be fully efficient or transparent. It further emphasized that there is a need for more participation, particularly as the Cardano governance matures with the upcoming Plomin Hard Fork. The Foundation has affirmed its commitment to making Project Catalyst more effective in spite of these challenges. It promised to improve the vote by setting clearer criteria for further rounds. 

The Foundation also encouraged large stakeholders to emulate these practices to foster fair and balanced decision making. It argued this would create a better environment for sustainable growth within Cardano.

Commitment to Transparency and Future Plans

The Foundation has pledged to make its voting process more transparent. It intends to publish a deep technical blog on how it voted in Fund 13. The blog will include insights on using community tools, such as Catalyst’s audit tool, to ensure the process is transparent and accountable. 

The Foundation also plans to continue working on improving the community governance framework for Cardano. They hope that discussions around governance will continue to mature and include input from the broader community. The Foundation highlighted the necessity of a process in which all the stakeholders can take part in decision making.

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