Cardano Community Approves 120 Million ADA Allocation to Boost DeFi Liquidity

The Cardano community has approved a proposal to allocate 120 million $ADA to AlphaGrowth’s PRIME program to strengthen the network’s DeFi ecosystem.

The initiative aims to increase Cardano’s total value locked (TVL) by strategically deploying capital across the ecosystem. However, the network still faces a significant liquidity gap. Cardano’s DeFi TVL currently stands at around $68 million, leaving it well behind larger rivals such as Ethereum and Solana.

Community Approves 120 Million $ADA Allocation

Cardano’s decentralized governance system approved the proposal after AlphaGrowth revised its original plan to address concerns raised by community members and delegates. The program aims to increase Cardano’s TVL to more than $200 million.

To improve accountability and reduce execution risks, AlphaGrowth introduced several safeguards. These include staggered fund releases over six months, a 24-month TVL observation period, term limits, and greater diversification among the groups responsible for managing the program.

The team also significantly reduced PRIME’s marketing budget following community feedback. AlphaGrowth cut the original $2.4 million ecosystem marketing allocation to $648,720 and divided the revised budget into three categories: 40% for external content creators ($259,488), 50% for activations and advertising ($324,360), and 10% for tooling ($64,872).

How the Community Voted

These changes helped the proposal gain broader support across the Cardano ecosystem. Prominent DRep Dave switched his vote to YES, while Iagon founder Dr. Navjit Dhaliwal and the Cardano Foundation also supported the revised proposal.

The vote ultimately passed with 73.04% of the voting stake, representing approximately 3.73 billion $ADA, in favor. Meanwhile, 26.96%, or roughly 1.38 billion $ADA, voted against the proposal.

Nonetheless, voter participation remained relatively limited compared with the total stake represented in the governance process. Of the 15.01 billion $ADA represented, approximately 5.11 billion $ADA participated in the final yes-or-no vote, while 9.90 billion $ADA abstained.

PRIME Targets Cardano’s DeFi Liquidity Gap

AlphaGrowth designed PRIME to address one of Cardano’s biggest challenges: turning its technological infrastructure into deeper economic activity.

Cardano has built a strong technical foundation around its eUTxO accounting model, smart-contract infrastructure, and decentralized governance. However, its DeFi ecosystem continues to lag behind larger competing networks in areas such as liquidity, user activity, integrations, and capital deployment.

Consequently, PRIME seeks to tackle the liquidity problem directly. By deploying the approved $ADA allocation strategically, the program aims to encourage greater DeFi activity, attract additional capital, and expand the number of users and applications operating within the Cardano ecosystem.

Community Demands Measurable Results

The approval has generated enthusiastic reactions across the broader Cardano community. Anastasia Labs CEO Philip DiSarro described the initiative as a necessary push toward more aggressive market execution.

At the same time, the proposal’s approval does not eliminate concerns over how the 120 million $ADA will be used. Community members have called for strict, milestone-based accountability to ensure AlphaGrowth delivers measurable improvements in TVL, liquidity, and ecosystem activity.