2025 Net Change Limit
On-chain changes
Informational action. No on-chain effect; the vote signals opinion only.
Abstract
The Cardano Constitution requires the establishment of a Net Change Limit, which defines the maximum amount of lovelace that can be withdrawn from the treasury during an outlined period of time. This governance action serves as an opportunity for all governance stakeholders to formally express their positions regarding the proposed Net Change Limit, ensuring transparency, accountability, and alignment across the ecosystem.
This Net Change Limit facilitates a yearly budget cycle for the Cardano community. The 2025 Net Change Limit will begin at the start of Epoch 532 and continue for 72 epochs, finishing at the conclusion of Epoch 604 in December 2025. The 2025 Net Change Limit will be 350,000,000,000,000 lovelace (350M ada). This is the maximum amount that can be withdrawn from the treasury during this specific period and shall not be exceeded.
The Net Change Limit will be used when reviewing both budget actions and treasury withdrawal actions to ensure constitutionality as required by Article IV of the Cardano Constitution and the Treasury Withdrawal Guardrails outlined in Appendix I.
Motivation & rationale
Prior to the submission of any budget request, a Net Change Limit must be formally agreed upon by delegate representatives (Article IV Section 3 of the Constitution). Failure to establish a Net Change Limit shall render any such budget request unconstitutional and, therefore, inapplicable.
The 2025 Net Change Limit will be effective for the period specified in this action. To support the ecosystem, a 2026 Net Change Limit will be established based on modeling but will remain separate from this governance action.
As agreed with the Cardano Budget Committee, the 2025 Net Change Limit shall begin at the start of Epoch 532 and progress for 72 epochs, concluding in December 2025 at the end of Epoch 604.
The 2025 Net Change Limit shall be set at 350,000,000,000,000 lovelace (350M ada).
This figure is derived from our modeling, which projected in October 2024 that the treasury would increase by approximately 351M ada across 2024 (epoch 459-531), including all approved withdrawals (e.g., Catalyst). Based on this analysis, the 2025 Net Change Limit was proposed at 350m ada. From January 5th, 2024, Epoch 459, through December 30th, Epoch 531, the actual total income into the Cardano Treasury was 335,957,093 ada. Since this is within 5% of our proposed number, the 2025 Net Change Limit should stay at 350 million ada.
We propose that the Net Change Limit be set based on the previous year’s total treasury inflows, creating a direct incentive for projects to enhance utility on the blockchain. This approach ensures that funded initiatives drive greater value across the broader ecosystem. We aim to support sustainable growth and long-term advancements within the Cardano network by fostering innovation, efficiency, and real-world applicability.
This limit shall be applied in assessing budget actions and treasury withdrawal actions to ensure compliance with Article IV of the Cardano Constitution and the Treasury Withdrawal Guardrails specified in Appendix I.
A vote in favor of this proposal shall indicate agreement with the proposed Net Change Limit, allowing for the submission of budget info actions and treasury withdrawal governance actions. The maximum amount that can be withdrawn from the treasury during this specific period shall not exceed the total sum outlined herein.
During the socialization of this Net Change Limit, we received feedback from the community that, since the Net Change Limit controls the total amount that can be withdrawn from the treasury in a specified period, the DRep ratification threshold for the Net Change Limit should be set at 67% of the treasury withdrawal parameter percentage. We neither agree nor disagree; however, we recognize that this Net Change Limit must adhere to the guidance outlined in the Cardano Constitution.
The provisions set forth in the Cardano Constitution state that the approval of a Net Change Limit requires a threshold of greater than 50% of the active voting DRep stake. Therefore, this Net Change Limit will be considered passed if it is greater than 50+1 lovelace%.
2025 Net Change Limit
Epochs 532 to 612Rationale highlights
Why some of the largest DReps voted for and against, in their own words. About vote rationales
I am thinking of voting Yes for both Intersect-led NCL(350M-2025) and Community-led NCL(300M-2025,250M-2026). There are two reasons for this. Regarding the amount of NCL, I believe that Community-led NCL is better. Therefore, I will vote Yes for this. I will...
I am thinking of voting Yes for both Intersect-led NCL(350M-2025) and Community-led NCL(300M-2025,250M-2026).
There are two reasons for this.
- Regarding the amount of NCL, I believe that Community-led NCL is better. Therefore, I will vote Yes for this. I will provide more details later.
- On the other hand, the worst-case scenario is that NCL is not agreed upon and set. To avoid this, I will also vote Yes for Intersect-led NCL. Although I believe that Community-led NCL is better, Intersect-led NCL is also acceptable in my opinion. I will provide more details later.
Details of reasons and concerns
- Why I think Community-led NCL is better
I will consider the pros and cons of Intersect-led NCL and Community-led NCL. I believe that Community-led NCL proposes a substantially better figure, so I will support it.
1-a) Points where I think Community-led NCL is better than Intersect-led NCL.
・The inflow to the treasury in 2025 is clearly less than the inflow in 2024, so I think it would have been better to use the projected inflow for 2025. The logic behind using the actual results for 2024 did not seem very clear to me from the rationale in this governance action.
・It would have been better to set the NCL for 2026 at the same time. The current Intersect block budget appears to be scheduled so that all expenditures are made from the treasury in 2025, including items that may be fine to spend in 2026. Not defining the NCL for 2026 could be an incentive to unnecessarily bring forward spending plans in 2025.1-b) Points where I think the Intersect-led NCL is better than the Community-led NCL.
・The Intersect-led NCL is better organized in terms of format. This includes the definition of the NCL and its period.- Reasons for voting Yes on the Intersect-led NCL at the same time
In my opinion, the worst outcome is that the NCL is not agreed upon after all. With the trend of global deregulation of blockchain, if the NCL is not agreed upon, the creativity of the community is limited, and Cardano's progress slows down, it will be a big loss in terms of Cardano's vision and roadmap.
One concern about voting Yes to both is the troubling question of what will happen if both NCLs are approved.
2-a) If we consider that the 2025 NCL will be overwritten, we may end up with an NCL of 350M ADA applied in 2025 and an NCL of 250M ADA applied in 2026.
2-b) The 2025 Net Change Limit does not contain any wording to the effect that "if this is adopted after the adoption of 'Set 2025 Net Change Limit of 300M ADA, 2026 Net Change Limit of 250M ADA,' the NCLs equivalent to 2025 in 'Set 2025 Net Change Limit of 300M ADA, 2026 Net Change Limit of 250M ADA' will be revoked." Therefore, if we consider that the 2025 NCL will not be automatically overwritten and that both NCLs will coexist and the stricter NCL will be applied, the 300M ADA NCL may be applied in 2025 and the 250M ADA NCL may be applied in 2026.
This interpretation will likely be determined by the Constitutional Committee, but I believe that either interpretation is better than having no NCLs at all.
*I have no particular conflict of interest related to this governance action.
私は、Intersect主導NCLとコミュニティ主導NCLの両方にYes投票をしようと考えています。
理由は２つです。
NCLの金額については、私は、コミュニティ主導NCLの方がより良いと考えています。よってこれにYesを投票します。後ほど詳細を記載します。
一方で、NCLが合意されず設定されないというシナリオは最悪のシナリオです。これを回避するために、Intersect主導NCLにもYesを投票します。コミュニティ主導NCLの方がより良いと考えていますが、Intersect主導NCLも私の考えでは許容可能です。後ほど詳細を記載します。
理由の詳細と懸念事項
- コミュニティ主導NCLの方がより良いと考える理由
Intersect主導NCLとコミュニティ主導NCLのメリットデメリットを考えます。コミュニティ主導NCLの方が実質的に良い数値を提案していると考えているため、これに賛成します。
Intersect主導NCLよりコミュニティ主導NCLの方が優れていると思う点。
・2025年の流入額は明らかに2024年の流入額より少ないため、2025年の流入額見込みを使用する方が良かったと考えています。2024年の実績を使った方が良いロジックはあまり私にとってこのガバナンスアクションに記載されるRationaleからは明確ではないように思えました。
・2026年のNCLも同時に設定した方が良かったように思えます。現在のIntersectのブロックBudgetは、おそらく2026年に支出しても問題ない可能性がある項目も含めて、2025年に全てトレジャリーから支出されるように支出スケジュールが組まれているように見えます。2026年のNCLが定義されないことで2025年に不必要に支出計画を前倒しするインセンティブになると可能性があります。コミュニティ主導NCLよりIntersect主導NCLの方が優れていると思う点。
・形式面はよりIntersect主導NCLの方がより良く整理されています。NCLやその期間の定義などです。- 同時にIntersect主導NCLにもYesを投票する理由
私が思うに、最悪の結末はNCLが結局合意されないことです。ブロックチェーンの世界的な規制緩和の潮流が巻き起こる中で、NCLが合意されず、コミュニティの創造性が制限され、Cardanoの歩みが遅くなることはCardanoのビジョンやロードマップから見て大きな損失です。
両方にYesをする点の１つの懸念として、この２つのNCLが２つともに承認された場合に何が起こるのかは悩ましい問いです。
2025年のNCLが上書きされると考える場合、2025年に350M ADAのNCLが適用され、2026年に250M ADAのNCLが適用される状態になるかもしれません。
・2025 Net Change Limitにおいて、「「Set 2025 Net Change Limit of 300M ADA, 2026 Net Change Limit of 250M ADA」が採択されたのちにこれが採択されたら、「Set 2025 Net Change Limit of 300M ADA, 2026 Net Change Limit of 250M ADA」の2025年に相当するNCLを取り消す」という旨の文言がないため、2025年のNCLが自動的に上書きはされず、両方のNCLが併存し、より厳しい方のNCLが適用されると考える場合、・2025年に300M ADAのNCLが適用され、2026年に250M ADAのNCLが適用される状態になるかもしれません。
この解釈は、憲法委員会が判断を下すと考えられますが、いずれの解釈を取ったとしても、NCLが全く設定されない状態と比べるとより良いと私は考えています。*このガバナンスアクションに関連する利益相反は私には特にありません。
Summary EMURGO as a DRep votes Yes on the info governance action. Rationale This Info Action proposes a 2025 budget of 350 million ADA. The year 2025 is expected to mark a critical period of transition, with significant regulatory developments anticipated in...
Summary
EMURGO as a DRep votes Yes on the info governance action.
Rationale
This Info Action proposes a 2025 budget of 350 million ADA. The year 2025 is expected to mark a critical period of transition, with significant regulatory developments anticipated in the United States and other key jurisdictions.
These developments are likely to open up new business opportunities across the blockchain industry. In light of this evolving landscape, and recognizing the importance of being strategically positioned for growth, we believe that setting the budget at 350 million ADA is appropriate. It provides the flexibility needed to respond to emerging opportunities while supporting Cardano’s ability to engage actively with an increasingly dynamic global environment.
Proposal link
https://adastat.net/governances/9b62b3c632f329016a968ac25211825bb4f84b12461121c7da3aa11df92370f900我在上一次投票中投了反对票，主要原因在之前分享过， 最重要的原因是目前缺乏对财政资金使用效率的评估机制 。目前 Cardano 生态尚未建立成熟的财政支出审查制度。在缺乏透明数据支持的前提下设定总支出额度，可能会掩盖资金浪费或滥用的问题。而在这个新提案中，这一问题仍未得到实质改善。 综上，这个提案我投反对。
I am voting no on the proposed 350 million ADA Net Change Limit because it sets the maximum that can be withdrawn from the treasury far too high without clearly defined needs or constraints. While the NCL is not a spending requirement, setting it this high...
I am voting no on the proposed 350 million ADA Net Change Limit because it sets the maximum that can be withdrawn from the treasury far too high without clearly defined needs or constraints. While the NCL is not a spending requirement, setting it this high risks framing it as a target rather than a safeguard, which goes against the principle of fiscal conservatism.
My platform emphasizes responsible, impact-driven spending. If we are to spend conservatively, we must also signal restraint at the framework level, and that starts with setting limits that reflect real strategic priorities, not just past inflows. Approving an NCL equal to 100 percent of last year’s treasury income sends the wrong message.
Until we have stronger data on actual funding needs, outcomes, and transaction volume growth, setting the NCL this high is not just unnecessary, it is the opposite of conservative.