Cardano has entered a critical juncture in its evolving governance structure, facing what some have dubbed its first “governance shutdown.” This unusual event stems from the recent announcement by the meme-inspired HOSKY account, claiming that the Constitutional Committee (CC)—a crucial component of Cardano’s on-chain governance—has fallen below its required minimum of seven members. The immediate trigger was the formal resignation of the Cardano Atlantic Council, a sitting member of the CC, which stated it would retire its CC keys on November 25 following the end of the current epoch.
The deeper issue, however, lies in a broader governance impasse—specifically, the failure of a proposal to compensate the CC members for their work. The Cardano Atlantic Council cited a lack of support from Decentralized Representatives (DReps) for the compensation proposal as the primary reason for stepping down. Their statement emphasized that their decision was not an attempt to sway votes or force negotiations but rather a reflection of a fundamental disconnect between expectations and community sentiment. Despite maintaining a perfect voting participation rate throughout their term, they announced they would not engage in future proposals.
Charles Hoskinson, Cardano’s founder, responded by downplaying the situation, framing it as a natural consequence of Cardano’s self-regulating governance model. In his view, the turnover in committee membership is not a failure but a built-in feature of the system’s resilience. “This is exactly how it’s meant to work,” Hoskinson said, reiterating that the ecosystem is designed to adapt and recover from such changes without compromising the chain’s functionality.
Central to the issue is Cardano Improvement Proposal 1694 (CIP-1694), which defines the governance architecture for the Voltaire era. According to this standard, the CC must maintain a minimum number of active members—referred to as the ‘committeeMinSize’ parameter. When the number of active members drops below this threshold, the CC loses its ability to ratify any governance actions requiring its approval. This includes key decision types like treasury withdrawals and changes to protocol parameters, which demand a majority vote from both the DReps and the CC. Without a functioning CC, these mechanisms are effectively frozen, even though the blockchain itself continues to operate and other governance actions can proceed.
The practical outcome is what some community members have labeled a “governance shutdown.” While this doesn’t halt block production or disable fundamental features of the chain, it does pause critical governance functions until the CC is replenished through an UpdateCommittee proposal or similar measure.
Reactions across the ecosystem have been measured but concerned. Jaromír Tesař, a leading DRep known as Cardano YOD₳, emphasized that this scenario was anticipated in the design of the governance framework. He expressed confidence that the situation could be resolved within a month, predicting that the community would soon approve new CC members, enabling governance to resume. Still, he acknowledged increasing fatigue among DReps and rising tensions over the stalled compensation proposal.
Tesař pointed out a key dilemma: most CC members view their responsibilities as demanding enough to merit payment, while many DReps remain staunchly opposed to the idea. This disagreement has become a growing point of friction, with voting participation reportedly on the decline with each epoch.
Another DRep, Dori, echoed the call for more transparent discussion surrounding the issue of compensation. According to Dori, many community members who voted against the proposal did so out of confusion or lack of prior communication about the rationale for rewarding CC members. She urged more open dialogue, noting that participants have real-world responsibilities and that sustainable governance must consider the human element.
Looking forward, the restoration of Cardano’s full governance functionality will depend on how swiftly the community can agree on new CC appointments—or revise the minimum committee size to reflect current participation levels. The tools to resolve the crisis are built into the system, but their effectiveness hinges on collective engagement and timely action.
This episode offers a revealing glimpse into both the strengths and fragilities of decentralized governance. On one hand, the system has mechanisms to self-correct and replace members. On the other, it also exposes how ideological divides—such as disagreements over compensation—can stall essential processes.
To avoid similar bottlenecks in the future, Cardano may need to explore more robust onboarding processes for CC candidates and clearer guidelines on compensation structures. Transparency, preemptive communication, and community education will also be critical in fostering trust and ensuring that proposals are evaluated on merit rather than confusion or fatigue.
Furthermore, this moment could serve as a catalyst for revisiting the governance model itself. As Cardano scales, the demands on its governance participants will only grow. Introducing part-time or rotating roles, implementing term limits, or even automating portions of governance through smart contracts could be potential evolutions.
The shutdown—while temporary—also raises questions about the sustainability of volunteer-driven governance. As the ecosystem matures, the need for incentivization becomes more apparent. Other blockchain networks have faced similar dilemmas, and the lessons learned from this incident may inform broader industry standards for decentralized governance.
In the end, the resilience of Cardano’s governance will be measured not by the absence of challenges, but by how effectively those challenges are addressed. With a robust framework already in place and an engaged community, the chain appears well-positioned to navigate its current impasse—and emerge more adaptive and inclusive for future governance cycles.