In a recent delivery report, Input Output (IO) announced its substantial progress on 16 out of 18 treasury-funded projects for the Cardano ecosystem during the fourth quarter of 2025 and the first quarter of 2026. This period has been crucial for testing whether the funding provided can translate into measurable, publicly verifiable developments.
As part of its commitment to transparency, IO emphasized that if funding does not yield tangible outcomes, it will be returned to the treasury. In this latest update, the organization confirmed the successful advancement of sixteen projects, while two—Acropolis and tiered pricing—were canceled, leading to the return of their respective funds.
Cardano Embraces Adoption with New Initiatives
The rollout of USDCx on Cardano stands out as the most significant milestone in terms of adoption. Announced in early 2026, USDCx launched just 84 days after its announcement, minting over 15 million tokens within its initial week. During this period, the total value locked (TVL) in Cardano’s decentralized finance (DeFi) ecosystem surged from $127 million to $142 million, with robust participation from prominent liquidity providers including Minswap, Liqwid, and SundaeSwap.
Interoperability also emerged as a key theme in the report. IO hailed the recently-announced integration with LayerZero, which connects Cardano to over 160 different blockchains and more than $80 billion in omnichain assets. This, it stated, is the most significant interoperability enhancement in the history of the ecosystem, especially relevant for Midnight’s selective disclosure and zero-knowledge proof architecture.
Several other notable developments were highlighted, including the launch of Cardano futures by CME Group in February, the addition of ADA as collateral for on-chain loans by Coinbase, and the operational launch of Midnight’s mainnet. Additionally, ADA is now accepted at 137 SPAR retail locations across Switzerland—an encouraging sign of real-world acceptance.
On the engineering front, IO provided an update on node reliability and security enhancements. The latest versions of Cardano nodes, 10.5.4 and 10.6.2, have improved network connectivity and system monitoring capabilities, paving the way for future protocol upgrades with versions v11 and v12 in the pipeline.
The key management entity also reached a milestone with the KES agent, which is now at version 1.0. This tool minimizes the risk of key-related attacks on over 3,000 stake pools within the Cardano network. Furthermore, by transitioning the UTXO (Unspent Transaction Output) set from memory to disk, IO has managed to slash node memory usage by up to 80%, significantly reducing resource requirements for operators.
Three-Pillared Approach to Scaling: Mithril, Hydra, and Leios
IO presented a multi-faceted approach to scaling Cardano, highlighting advancements in three key areas: Mithril, Hydra, and Leios. Mithril has reached its first stable release, supporting decentralized message queue protocols, making progress towards operating autonomously.
Hydra’s development has advanced considerably, with versions 1.0.0 through 1.3.0 now featuring enhancements for node performance and user interaction. Meanwhile, Leios, aimed at increasing Cardano’s base-layer throughput, has produced its first prototype capable of creating and distributing large endorsement blocks across a multi-node network.
In conjunction with infrastructure improvements, IO stressed the importance of developer tools. The Plutus platform has received valuable upgrades, while Cardano High Assurance has opened early access to select companies for testing formal verification processes at the UPLC level.
Research continues to be integral to IO’s mission, with 2026 witnessing the completion of all funding milestones in Work Package 25. The consultation reached over 24,000 individuals, leading to new academic insights shared at Financial Cryptography 2026.
As Cardano resets its sights for the future, IO has outlined several objectives for Q2, including the implementation of protocol version 11, updates for Mithril, and readiness activities targeting upcoming workshops and testnets.
At the time of reporting, Cardano’s ADA token was trading at approximately $0.2491, amid a flurry of activity and growth potential within its ecosystem.
