To the Cardano community,

Tweag by Modus Create is writing to inform the Cardano community of a significant funding shortfall affecting our ongoing delivery work related to Ouroborous Peras. Work on this scope began before the treasury withdrawal was awarded in August 2025, and delivery has continued since then. We are not waiting until every detail is resolved to speak publicly. We want the community to understand the situation today. We are sharing this update now because the right thing to do is to be clear about where things stand.

Firstly, we are continuing to deliver the most critical roadmap-aligned work, and the teams on that scope remain on schedule. However, we had to make a decision to pause a significant part of our planned work until future funding can be secured.

Tweag has been an integral part of the Cardano ecosystem and its development for over eight years, with continuous work traceable to January 2018. We have been contributing to Cardano’s core development across various initiatives, namely Ouroboros Genesis, Ouroboros Peras and contributions to the Ledger and Consensus. We have been, and continue to be, committed to the long-term resilience and growth of Cardano - this hasn’t changed.

What has changed

Back in 2025, our budget was built around an ada conversion rate of approximately $0.66 per ada. Market conditions shifted sharply ahead of the milestone delivery and the ada conversion to USD, and when the conversion became necessary, the realized rate was materially lower. The result is a funding gap of roughly $3.5 million in effective delivery capacity, or about 50% of what the original budget was expected to cover.

That shortfall is not theoretical and it is being absorbed now. With delivery continuing on the most critical aspects of Peras, a meaningful portion of ongoing Cardano work is currently being self-financed by Tweag by Modus Create while we work through the path forward. We have waited since November 2025, hoping that the price of ada would recover as we entered February 2026. As a consequence, our projects burned more than what was received, and the remaining work was at stake. We had to make a decision that both protects the company and preserves the most critical work for the community.

We have been in close collaboration with Intersect on the issues and the scope of work that is currently in development. Intersect supported Tweag with stablecoin options, but due to the combination of receiving payment in milestones and the nascency with Cardano’s stablecoin and Treasury landscape back in 2025, hedging predictable revenue has been challenging. Now with USDCx, and the continued growth of Cardano’s native stablecoins (USDM/A), we know this issue is being actively resolved by Intersect in 2026.

Where things stand

Our priority is to protect the work that matters most. Delivery on the most critical, roadmap-aligned work continues. Other projects are being paused until additional financing is in place. The full delivery log remains available at https://tweag.github.io/cardano-website/. Further details on delivered and paused workstreams are provided in the FAQ below.

Closing this gap is necessary if delivery is to continue beyond the near term. Tweag by Modus Create is planning to pursue an additional treasury action to address the shortfall. Once that route is confirmed, we will bring forward a concrete proposal. It will set out the scope, timeline, and amount required to complete delivery. The community will not be asked to approve a vague request.

The next proposal will focus on delivery, hardening, and activation. It will be structured around three areas of work:

• Protocol delivery - Peras v1 to mainnet, Peras v2 for resilience, and History Expiry to keep node operation affordable as throughput grows.
• Safety scaffolding - Conformance testing, mutation testing, the Hoarding Node suite for network observability, and the Hard Fork Incident Mempool Bridger as a safety net.
• Developer and operator tooling - The Plutus Script Re-Executor, canonical ledger state for Mithril and Amaru integration, and maintenance of tools the ecosystem already depends on.

Ouroboros Peras reduces transaction settlement from approximately 12 minutes to 2-5 minutes. Faster finality makes L2s, partner chains, and applications built on Cardano more practical. Peras cannot be shipped safely without the testing scaffolding, and throughput cannot be increased responsibly without History Expiry. These pieces are designed to land together

What is being asked

We are seeking a supplementary treasury allocation of approximately $3.5 million to cover the shortfall resulting from ADA market movements since the original award. Due to the specific nature of this request, and because it does not represent new work, Tweag will raise a Treasury Withdrawal governance action directly on-chain rather than submit through Intersect’s budget process. Intersect will support the submission and remain as Administrator.

In return, the community can expect continued delivery against the committed roadmap, full transparency on milestones, and a public record of progress that it can hold us to.

Tweag started this work before the funding landed. The team kept building when the economics moved against it. That is the track record behind this request.

To everyone in the Cardano ecosystem, thank you for your scrutiny. It is warranted, and it is welcome.

Tweag by Modus Create
Paris, 17 April 2026

---

Frequently Asked Questions

Where did the money go? The funds were not misused or misdirected. The shortfall is the direct result of a significant drop in the value of ADA between the time the treasury award was granted and when conversion to fiat became necessary to cover operational costs. No budget was lost to overhead or administrative fees — the gap is entirely a function of market movement.

Who approved the conversion timing? This was the first treasury-funded engagement of this scale for our team, and the conversion process involved our administrator and multiple parties across the organization. In navigating an unfamiliar process under shared coordination, we missed the window when ADA was trading at a higher value. We recognize that as a failure of process, and we are putting clearer conversion protocols in place so this situation does not repeat itself.

What exactly was delivered?

Status of the projects

“Pre-alpha-Peras to the private testnet” — we are halfway towards completion and continue to view the master repo on GitHub

• T1.0 Project Kick-Off
• T1.1 Peras core library (Jan 12)
• T1.2 Dashboard prototype available https://tweag.github.io/cardano-peras/dashboard/ (Jan 15)
• T1.3 Weighted Chain Selection (Nov 14)
• T1.4 Vote Diffusion and Storage (in progress)
• T1.5 Peras Prototype Implemented for Caught-up Nodes (in progress)
• T1.6 Final documentation and testing on a private testnet (in progress)

Cardano Canonical Ledger — we have submitted all milestones View on GitHub

• T2.1 Full CIP — completed on (Nov 17) https://github.com/cardano-foundation/CIPs/pull/1083
• T2.2 Haskell serialization code — completed (Mar 18)
• T2.3 State tooling — completed (Feb 13)
• T2.4 Test suite — completed (Mar 18)

Black box Ledger Conformance Testing — continuation of Cardano Canonical Ledger 95% complete. View on GitHub. See description

• T3.1 Ledger state diff tool — completed (Mar 30) https://tweag.github.io/cardano-website/projects/cls/documentation/scls-util/
• T3.2 Cardano ledger test integration — in progress (ETA: end of April)
• T3.3 Testing repository — in progress (ETA: end of April)

Genesis Sync Accelerator — 100% complete, we gathering statistics on sync before making a final demo View on GitHub

• T6.1 Genesys Sync Accelerator Implementation — completed (Apr 10)
• T6.2 GSA technical documentation and supportive tooling (in progress)

Cardano node emulator — 100% complete, in maintenance mode

• T10.1 Initial CNE Update — completed (Dec 2)

What exactly is paused?

For paused project we have two groups: ones on the last mile and projects that were rethought

Last mile:

• Conformance Testing of Consensus — 90% complete View project board
• Plutus Script Re-Executor — 85% complete View on GitHub
• Hoarding Node — 85% complete View on GitHub
• Block Cost Investigation — 30% complete View on GitHub

All those projects were submitted for the next years of the proposals with natural extensions targeted towards deep integration with the ecosystem and their use on the mainnet. We expect to continue development in June 2027.

Rethought:

• History Expiry — initial design complete
• Canonical Block and Transaction Diffusion Codecs — not started

After the Cardano conference we understood that the initial proposal was not beneficial for the community, as a result we have proposed another approach see our blog post

The History of History Expiry - Tweag. So instead of doing two big projects we propose implementation of a single smaller scoped approach that will be highly beneficial for the network once Leios and Peras reach mainnet.

When will we vote? We plan to submit our supplementary treasury proposal within the next few days. Once submitted, the community will have full visibility into the scope, the amount requested, and the timeline for delivery. We will announce the submission across all official channels and make ourselves available for questions.

What are we committing to? If the supplementary allocation is approved, the community can hold us to the following:

• Continued delivery against the committed roadmap, on the timelines already published
• Full milestone transparency, with progress updated publicly at tweag.github.io/cardano-website
• A clear and auditable record of how the supplementary funds are allocated
• Proactive communication if any future risks to delivery arise — we will not wait until a shortfall is realized to speak publicly

Why support Tweag by Modus Create? Tweag has been part of the Cardano ecosystem since 2018. When market conditions moved against us, we did not stop building — we absorbed the costs ourselves and kept the most critical work on schedule. This request is not for new work or expanded scope. It is to complete what we already committed to, under circumstances that changed after the original award. The track record is public, the delivery log is live, and the ask is specific. We are not asking for trust on faith — we are asking the community to look at what has been built and decide whether it is worth completing.