Project Catalyst has long stood as one of the most ambitious experiments in decentralized governance and innovation funding in the blockchain space. As Cardano’s native treasury and community proposal system, Catalyst distributes millions of ADA to ideas that range from developer tools and DeFi protocols to education, events, and social impact projects. But with scale comes scrutiny and in recent years, Catalyst has faced pointed critiques from both within and beyond the Cardano ecosystem.
Critics have raised concerns around power centralization, inconsistent project delivery, low voter engagement, and the complexities of the user experience. Some have questioned whether Catalyst truly lives up to its promise of decentralization, citing the outsized influence of large ADA holders and the continued operational involvement of founding entities. Others worry about a lack of project accountability and whether the treasury’s resources are being used to fund impactful, sustainable initiatives.
These critiques are not unfounded and importantly, many of them are being heard.
The Catalyst Horizons 2025 Report and the Input Output Catalyst Innovation 2025 Budget Proposal both acknowledge these issues directly, and more significantly, present clear steps being taken to address them. Among the most promising developments is the shift to more inclusive and representative voting models. The introduction of Quadratic Voting and time-weighted stake - still in development and prototype due to be used in Fund14 - aims to dilute the dominance of large wallets, while empowering smaller holders to meaningfully shape the ecosystem’s direction.
Equally important are the improvements in project accountability. Catalyst has evolved from a simple proposal-and-vote model to a structured funding approach that includes milestone-based disbursements and, for the first time, a formal suspension and cancellation process. Projects that fail to deliver now risk losing their funding, and a new focus on retroactive public goods funding rewards teams for results, not promises. These changes reflect a clear maturation of Catalyst’s oversight capabilities.
On the usability front, Catalyst is working toward a unified platform and mobile-first experience to make Catalyst available on any device addressing the lower participation barriers - especially in regions where desktop access is limited. This includes a streamlined platform for submitting, reviewing, voting on, and tracking proposals, with better documentation, clearer user flows, and built-in support channels to help new users engage confidently.
Perhaps one of the most pivotal changes lies in Catalyst’s underlying infrastructure. The Hermes engine, now under development, is designed to decentralize Catalyst’s data and decision-making records, eliminating reliance on centralized servers and sidechains. If successful, Hermes could make Catalyst’s governance logic as decentralized as Cardano’s consensus layer—aligning the system’s backend with its ethos.
Despite these strides, challenges remain. Whale influence, though being addressed, still looms large. User turnout has improved, but engagement remains relatively low compared to the number of ADA holders but still much larger than most other blockchain ecosystems. And while many Catalyst-funded projects are doing impactful work, a small minority have underdelivered or disappeared entirely. Sustaining community trust will depend not only on publishing success stories, but also on transparently learning from missteps.
What’s clear is this: Catalyst is not static. It’s iterative. Its governance processes are evolving in real-time, shaped by community feedback, research, and experimentation. That flexibility can feel messy at times—but it also reflects the open, participatory nature of the Cardano ethos.
For Catalyst to fulfill its potential as a decentralized funding engine, continuous improvement is non-negotiable. But so is optimism. The systems being put in place today—advanced voting, decentralized infrastructure, smarter UX, and clearer accountability—are foundational for a more inclusive and effective future.
As we look ahead, Catalyst remains a work in progress, but it’s also a beacon. It represents the kind of bold, community-first governance model that blockchain was built to explore. Its critics sharpen its design. Its supporters propel it forward. And its future, fittingly, lies in the hands of the many, not the few. Who is your dRep and what are they voting for? More, are they voting for you?
Read the report here:
Project Catalyst in Context: A Comparative Analysis of Cardano’s On-Chain Governance and Funding Mechanism