October 29, 2024

5 Things to Expect in Chang Hard Fork Part 2 (Cardano)

EMURGO

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The Cardano blockchain’s Chang Hard Fork has been a pivotal two-part upgrade to enhance network functionality and decentralized governance. Earlier this year, the first part of this upgrade went live, delivering critical improvements like burning the genesis keys, granting voting power to the Interim Constitutional Committee, and embedding the hash of the Interim Cardano Constitution on-chain. These upgrades marked a significant step forward, empowering Cardano’s community to shape the network’s future.

A blockchain hard fork updates the software across the distributed network of nodes that validate and secure the blockchain. As each node follows the protocol that governs the network, it must adopt the upgrade to continue operating. Hard forks enable new functionalities, bolster security, and streamline network operations, among other benefits.

Now, with the first part completed, the second phase of the Chang Hard Fork promises to bring even more advancements to Cardano that will enable the community to shape its future. While some of these enhancements will roll out in this second stage, others are set to launch with the ratification of the upcoming official Cardano Constitution.

Let’s dive into five major updates expected in Cardano’s Chang Hard Fork Part 2.

1) Empowering Community Voices: Delegate Representative Voting

The second phase of Cardano’s Chang Hard Fork will introduce Delegate Representative (DRep) Voting, a crucial step in empowering Cardano’s decentralized governance model. DReps will serve as one of the three primary governing bodies in Cardano’s future governance structure, providing a mechanism for community-driven decision-making. Once fully integrated, DReps will have the authority to vote on proposals and governance actions submitted by the Cardano community. This makes their role essential for representing the voice of ADA holders on the network.

Registration to become a DRep is currently open. A one-time deposit of 500 ADA is required to obtain an on-chain DRep certificate, officially designating them as registered members. Cardano’s Gov Tools website also facilitates DRep registration, simplifying the process for new participants.

Encouraging community participation is essential, as each DRep’s voting power depends on the amount of ADA delegated to them. To maximize influence, DReps should start actively engaging with ADA holders and building support as soon as possible. By doing so, they can secure delegations and play a substantial role in shaping the future of Cardano through collective decision-making.

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2) SPO Voting: Giving Infrastructure Providers a Voice

A key upgrade in Chang Part 2 will be SPO (Stake Pool Operator) voting. As a core governing body on the Cardano network, SPOs represent the community segment that supports the network’s infrastructure. With this update, SPOs can soon leverage the ADA delegated to their pools as voting power. This means they, like DReps, can vote to approve or reject community-proposed governance actions, helping shape Cardano’s future.

SPOs’ influence will hinge on the amount of ADA delegated to them, making it vital to sustain delegation levels and communicate their decisions transparently to delegators. This addition will transform the role of SPOs, allowing them to play an active part in Cardano’s move toward decentralized governance.

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3) Governing Actions: Cardano’s Path to Full Decentralized Governance

A key feature of Cardano’s decentralized governance model is governing actions—proposals anyone in the Cardano community can submit. Once Chang Hard Fork Part 2 is implemented, ADA holders will be empowered to create governance actions, fostering community-led changes. To initiate a proposal, ADA holders must make a small ADA deposit, which is fully refunded after voting ends, regardless of the result.

Read more: Explaining Cardano’s governing bodies

Governing actions are central to Cardano’s transition to a decentralized future. These actions are subject to voting by Stake Pool Operators (SPOs) and Delegate Representatives (DReps), ensuring that decisions reflect the Cardano community’s vision. Through these mechanisms, Cardano is truly placing control in the hands of ADA holders, further strengthening its decentralized governance framework.

4) Treasury Withdrawals: Funding Cardano’s Future

For governing actions to be impactful, they require a budget—and Chang Part 2 will introduce a treasury withdrawal system tied to successful votes. When the Cardano community approves a governing action, funding will be allocated directly from Cardano’s treasury to bring these initiatives to life.

This mechanism enables ADA holders to actively shape how treasury funds promote network growth. Rather than merely serving as suggestions, these governing actions become actionable, community-driven projects with dedicated resources for execution. In this way, Cardano’s treasury becomes a vital tool for realizing the community’s vision and expanding the network.

5) Expanded Constitutional Committee: Broadening Representation in Cardano Governance

With the completion of Chang Part 2, the Constitutional Committee will be able to expand, allowing for greater representation across the Cardano community. Currently, the interim Committee is limited to a fixed membership of seven. Still, this upgrade will open the door to additional members, ensuring broader input and diversity, especially when the committee exercises veto power.

The expanded committee will welcome individual members as well as representatives from companies, DAOs (decentralized autonomous organizations), NGOs, and other groups within Cardano. Each entity can appoint a representative to participate in the Constitutional Committee’s operations, adding a potential new layer of inclusivity to Cardano’s decentralized governance framework.

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