Cardano has successfully implemented its Chang upgrade, marking a significant shift to a decentralized governance model. This transition allows ADA holders to influence the future direction of the network directly.
Named after the Chinese mathematician Ch’ang Shou, the upgrade was finalized at block 10,764,778 on September 1.
Key Changes with the Chang Upgrade
The Chang hard fork introduces several transformative changes to Cardano’s governance and operational structure. The upgrade features on-chain voting capabilities, the introduction of Delegate Representatives, enhancements to smart contract functionality with PlutusV3, and improvements to the governance structure and cost model.
Cardano is entering what it refers to as the “Conway ledger era,” characterized by a governance model based on “liquid democracy.” This system allows ADA holders to vote directly on governance matters or delegate their voting power to trusted representatives, known as Delegate Representatives (dReps).
In addition to dReps, two other user-led governance bodies—the Constitutional Committee and Stake Pool Operators—will oversee and implement governance actions. Previously, this role was held by Cardano’s founding entities: the Cardano Foundation, Input Output Global, and Emurgo.
Phased Implementation of the New Governance Model
The transition to the new governance model will occur in two phases. The initial phase involves setting up an Interim Constitutional Committee with temporary authority to oversee the governance transition. This phase is focused on ensuring security and stability while the new governance framework is established and dReps are registered.
Over the next 90 days, the network will progressively transfer power to the new governance bodies. The second phase, anticipated to begin in early 2025, will fully empower the dReps, Stake Pool Operators, and the Constitutional Committee to make key decisions, including voting on proposals and managing the treasury.
The Chang upgrade also introduces advanced voting mechanisms through Plutus scripts, supporting methods such as voting within Decentralized Autonomous Organizations (DAOs).
Impact and Market Response
The Chang hard fork is a crucial step towards the Voltaire era, aimed at creating a self-sustaining ecosystem for Cardano. Although the upgrade was initially scheduled for August 30, it was postponed to allow cryptocurrency exchanges, such as Binance, to prepare for the transition. Binance was among the first exchanges to support the fork.
Despite the high expectations surrounding the upgrade, the price of ADA has seen a decline of 3.1% over the past 24 hours, reflecting a lack of immediate market benefit.
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