The Catalyst Transparency Gap: Off-Chain Costs, Technical Debt, and the Voltaire Transition

Governance Project Catalyst
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As we close out 2025, the Cardano ecosystem faces a dual-governance reality. While the protocol has successfully transitioned to the Voltaire era (CIP-1694), Project Catalyst remains largely anchored to a legacy, off-chain infrastructure. This post analyzes the fiscal and transparency implications of maintaining this “black box” and the urgent need to migrate Catalyst to native, on-chain voting mechanisms.

  1. The “Black Box” of Off-Chain Voting
    Despite the decentralized ethos of Cardano, Project Catalyst voting does not occur on the Mainnet. It operates on a sidechain/testnet environment (Jormungandr).
  • The Verification Gap: Because the tallying and processing happen in a siloed, off-chain environment, the community cannot verify results in real-time. We rely on “tally reports” published by the Fund Operator after the fact.
  • The Tallying Risk: Any errors in the off-chain payload (which have occurred in previous funds) require a centralized fix from the operator, rather than being resolved by the ledger’s own consensus.
  1. The Infrastructure Tax: Duplicate Costs
    Maintaining a separate voting app, a separate snapshot mechanism, and a separate sidechain is not free. In the 2025 Innovation Budget, we see significant ADA earmarked just to keep Catalyst on “life support” rather than utilizing native Voltaire tools.
  • Operating Costs: Recent budget requests for “Catalyst Digital Infrastructure” (UI/UX and Hermes backend) have exceeded 5.1 Million ADA per year.
  • Staffing & Admin: Total management and execution for 2025 rounds are estimated at ~₳10M+ (between staffing, subcontractors, and vendors).
  • The Redundancy: We are currently paying to build and secure the on-chain DRep system while simultaneously paying millions to maintain a legacy off-chain mobile app that community members have described as a barrier to sophisticated project evaluation.
  1. Impact on Decentralization (The “Sybil” Factor)
    The lack of transparency in the off-chain process favors established “Catalyst Giants.” These teams have mastered the administrative “meta” of the off-chain system:
  • Diversified Proposals: Entities like Project NEWM have successfully secured ~19M+ ADA by diversifying proposals across founders (Ryan Jones, Jimmy Londo) and various accounts.
  • The “Governance Discount”: When the Treasury acts as a perpetual seller to fund these administrative costs and legacy grants, it creates a downward pressure on ADA’s price, which has touched yearly lows of ~$0.34 in late 2025.
  1. The Path Forward: On-Chain or Bust?
    With Voltaire now live, the community must ask: Why are we still using Ideascale and Jormungandr?
  • Native Integration: Moving Catalyst to the mainnet would allow DReps to vote on funding directly, utilizing the same security and transparency as Protocol Parameter changes.
  • Treasury Efficiency: Eliminating the specialized “Catalyst Infrastructure” team could save the treasury upwards of 10-15 Million ADA annually, which could be redirected to actual project grants.

Discussion Points:

  • Is the “safety” of a separate voting environment worth the lack of transparency and high administrative overhead?
  • Should we mandate that Fund 14 be the final fund to utilize off-chain tallying?
  • How do we prevent “Service Provider” teams from monopolizing the treasury when the voting process remains siloed?

I look forward to hearing the community’s thoughts on whether we should prioritize a total migration to on-chain governance for all Treasury withdrawals.
cardano Governance voltaire treasury

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