Cardano recently completed its Chang upgrade, transitioning to a decentralized governance system. This new system allows ADA holders to actively participate in shaping the future direction of the network. By enabling on-chain voting, introducing Delegate Representatives, enhancing smart contract capabilities with PlutusV3, and implementing a new governance structure, Cardano is taking a significant step towards a more inclusive and community-driven model.
The upgrade signifies the beginning of the “Conway ledger era” for Cardano, characterized by what the network calls “liquid democracy.” In this new era, ADA holders have the choice to either vote directly on governance matters or delegate their voting power to trusted representatives, known as Delegate Representatives. This system aims to ensure that the network remains transparent, fair, and representative of the community’s interests.
Phased Approach to Governance Transformation
Cardano’s shift to the new governance model will occur in two phases. The first phase involves establishing an Interim Constitutional Committee with limited authority to oversee governance temporarily. This initial phase focuses on maintaining security and stability during the transition, allowing Delegate Representatives to register and gain support. Following this, power will gradually transition to the new governance bodies over a period of 90 days.
The Empowerment of dReps and Stake Pool Operators
The second phase, set to commence in early 2025, will empower Delegate Representatives, Stake Pool Operators, and the Constitutional Committee to make critical decisions regarding the network. This includes voting on proposals, managing the treasury, and ensuring the effective operation of Cardano’s governance structure. The Chang upgrade also enables the use of Plutus scripts for governance, facilitating advanced voting methods within Decentralized Autonomous Organizations.
The recent hard fork represents a crucial step towards the Voltaire era for Cardano, in which the network aims to become a self-sustaining ecosystem. While the Chang upgrade was initially scheduled for Aug. 30, it was postponed to allow cryptocurrency exchanges to prepare for the transition. Binance was among the first exchanges to announce support for the fork. Despite high anticipation surrounding the upgrade, the price of ADA did not experience a significant boost and was down by 3.1% over the past 24 hours.
Cardano’s Chang upgrade symbolizes a pivotal moment in the evolution of its governance system. By embracing decentralization, on-chain voting, and Delegate Representatives, Cardano is laying the foundation for a more democratic and community-driven network. As the transition to the new governance model progresses, the network is poised to empower stakeholders and enhance transparency, ultimately paving the way for a self-sustaining ecosystem in the Voltaire era.