Cardano is developing a self sustainable governance model in which participants in the network have a voice, control over the future developments and the applications and services that emerge from it. This governance model is backed by a treasure in which voting power is proportional to the corresponding stake. Voting does not require identity.

The treasure is collecting funding from:

  • minting new ADA

  • BFT nodes

  • transaction fees

  • transaction fees from staking rewards

  • stake pool registrations

  • IOG stake pools

  • lost rewards from stake pools being saturated

  • stake pool delegations

  • donations

What is liquid democracy?

Liquid democracy is a voting mechanism that is backed by a treasure system to incentivize ADA stakeholders.

Liquid democracy is a combination of direct- and representative democracy as we see in democratic countries. In these countries citizens have a vote or a saying in democratic decision making. Either direct (in case of Swiss) or via a representative (a politician) in other Western countries.

How does this translate into Cardano?

ADA stakeholders can vote for domain experts in the Cardano network.

Who are these domain experts?

  • Proposers in project Catalyst (developers, software companies, entrepreneurs, representatives etc.)

  • Stake pool operators (are expected to be experts in their domain in operating their stake pool professionally and have in depth knowledge of the Cardano ecosystem)

Domain experts are incentivized for contributing to the Cardano ecosystem.

  • Proposing ideas and solutions in project Catalyst and have the chance to be funded for their idea. ADA stakeholders are voting for these ideas.

  • Running a stake pool and earning rewards for contributing to the security and decentralization of the network by producing blocks on basis of block assignment. ADA stakeholders can support stake pools with their stake.

ADA stakeholders (stake pool operators are also ADA stakeholders)

  • Can directly vote for proposals in project Catalyst similar like in direct democracy.

  • Can decide to stake with a stake pool operator that shows its domain expertise. This is a indirect vote to a representative like in a representative democracy. The stake pool owner has a vote in the future direction of the Cardano blockchain when Voltaire is fully rolled out and has a representing role towards its delegators.

ADA stakeholders are incentivized to vote and to stake since they can earn rewards on basis of their stake.

  • By voting for winning proposals (sound proposals that have the highest chance to succeed and that get the most votes from ADA stakeholders).

  • By staking with stake pools and receiving rewards on their stake as percentage of their weight of stake in the stake pool and the rewards received by the stake pool minus stake pools fees and fixed costs.

Funding and rewards are being paid from the treasure.


It is obvious that this model is unique and not seen before in the blockchain industry. The engineers at IOHK did a great job in thinking out this model on refining existing solutions like DASH and ZCash who did pioneering work. The result is a better and more sustainable model.

The whole purpose of this model is to reward ADA stakeholders who contribute in a positive way to the Cardano project with their domain expertise and as such contributing to the overall success of this blockchain.

A message to ADA stakeholders (excluding stake pool operators)

If you care about the Cardano project and its future success you should stake with care and choose for a stake pool that is contributing in a positive way to the Cardano ecosystem. Here I mean not just chilling the project or price of the ADA token on YouTube or Twitter to make quick rewards on their stake.

In case the Cardano project succeeds in what they are trying to achieve the price of ADA will follow, don’t think short term.

Support stake pool operators who

  • Invested in professional hardware infrastructure and have a long term vision supporting the project

  • Keep their in depth knowledge about Cardano up to date and share this knowledge with the community and their delegators

  • Improve on their infrastructure by maintaining, updating and securing it appropriate

  • Use their stake pool rewards to be re-invested in the Cardano ecosystem. For example: by developing community solutions

  • Proposing solutions in project Catalyst

  • Are building solutions themselves on Cardano

  • Bring their own business network in

I hope this post is contributing to your knowledge about Cardano and how you can contribute to the future success of Cardano by supporting the stake pool operators that really deserve your support.

Enjoy your weekend.

Ron – JUNO stake pool

Creator of (in alpha)

Part of team Artano – a NFT marketplace to be build on Cardano