Overview

How Cardano's proposed future governance model will work

Cardano's governance - three defining pillars

Cardano's governance structure is made up of three areas of interest:

• On-chain decision making (best described in the specification, CIP-1694)

• A Cardano Constitution

• Institutions (such as the member-based organization, Intersect)

Each area delivers complementary features to the others and are intertwined to drive better outcomes both on and off chain.

On-chain Decision Making

Cardano Improvement Proposal-1694 (CIP-1694) describes a governance system to bring decision making for the Cardano network on-chain. It seeks to advance the current governance system ensuring every ada holder has a voice in Cardano’s governance.

There are three key governing bodies with roles on-chain to secure consent on proposals submitted by the community (otherwise known as governance actions). The three roles played by stakeholders are:

• Delegate Representatives (DReps)

• Constitutional Committee (CC)

• Stake Pool Operators (SPOs)

Depending on the type of governance action, a combination of the three roles above will vote to either accept or reject a proposal.

The Cardano Constitution

Interim

In Q2 2024, the Interim Cardano Constitution will be published for community review and included in the genesis files when the community approves Chang Update #1. The Interim Constitution is not a fully elaborated constitution, but rather a set of essential rules that are designed to ensure Cardano maintains stability during the interim period that Cardano’s governance will go through during 2024. The Interim Constitution will be interpreted by the Interim Constitutional Committee who will vote on the constitutionality of governance actions (as described in CIP-1694).

Draft

Later in Q2 of 2024, the drafting process will begin with the aim to move towards a final version ratified later in the year. The draft will serve as the primary input to global community workshops throughout 2024. With community input, the Draft Constitution may build upon the essential guardrails described in the Interim into a more holistic set of principles and rules.

Final

The final version of the constitution will be both ratified at a constitutional convention composed of community delegates, and voted on by ada holders and ratified using the on-chain mechanisms described in democratic consent. The final version of the constitution will, like the draft, set forth principles and rules for Cardano, but will be the version suggested by the community through a year long consultation process

Institutions

Institutions create the spaces and structures for the ecosystem to ideate, deliberate and recommend changes to the Cardano network. They can be informal collectives and alliances such as the many working groups formed by the community since Cardano launched, to newer larger organizations such as Intersect. In the example of Intersect, it will not only develop into a rallying point for community discussion, but will also work towards maintaining Cardano’s open source repositories and product backlogs.

Institutions support the feedback loop to ultimately drive better outcomes on-chain for the wider benefit of the Cardano ecosystem.

Looking Ahead

With these three overarching governance features, the ecosystem will have the foundation of a governance system that can be observed and refined over time by the ecosystem itself. The age of Voltaire has only just begun.