Cardano, one of the leading blockchain platforms, is set to undergo a significant upgrade with its upcoming Chang Hard Fork. The current launch date is set to be on September 1, 2024. Chang is designed to enhance the network’s governance and decentralization. 

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What Is the Chang Hard Fork?

A hard fork refers to a substantial upgrade or change in the network’s protocol that is not backward compatible. This means that once the upgrade is implemented, all participants in the network must adopt the new rules to continue using the blockchain. Nodes (computers that maintain the blockchain) that do not update to the new version will no longer be able to participate in the network. 

Sometimes, hard forks can lead to the creation of two separate blockchains. This happens if a portion of the network participants decide to continue using the old version of the software. One of the most famous examples of a hard fork occurred in 2017 when Bitcoin Cash was created as a result of a split from Bitcoin. The fork was driven by differing views on how to scale Bitcoin to handle more transactions. While the Chang Hard Fork doesn’t seem to be as controversial enough to warrant a split, it is still worth paying attention to since it will govern the network moving forward. 

The Chang Hard Fork brings Cardano into the Voltaire era of its roadmap which focuses on establishing a sustainable and distributed governance framework. Chang will introduce governance mechanisms that Cardano hopes will eventually lead to a fully decentralized blockchain. It is set to be implemented in two phases.

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Phase 1: Laying the Foundation for Community Control

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The first phase of the Chang Hard Fork introduces new tools that will allow the Cardano community to start taking a more active role in decision-making. This phase is guided by Cardano Improvement Proposal (CIP) 1694, which outlines how these changes will happen.

One of the key changes is the addition of two new sections to each transaction on the network. These sections will be used for submitting and voting on governance actions - decisions about how the network should evolve. Essentially, any Cardano user will be able to propose changes, making the process more democratic.

To ensure that all proposed actions are fair and well-considered, they will need approval from at least two out of three new groups: the constitutional committee (a group of experts), Delegate Representatives (DReps) (community members chosen to represent others), and Stake Pool Operators (SPOs) (people who maintain the network). This careful review process ensures that decisions aren’t centralized and made with broad support from the community. 

Since fully transferring control to the community cannot happen overnight, temporary measures are being put in place. One of these is the Interim Cardano Constitution, a temporary rulebook that will guide the network until the community drafts and approves a permanent constitution. A temporary group, the Interim Constitutional Committee (ICC), will enforce this rulebook and oversee the first on-chain governance actions. This committee will have seven members, including three elected by the community, and will have the power to block decisions that go against the interim constitution.

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Phase 2: Full Community Governance

The second phase of the Chang Hard Fork, expected by the end of 2024, will fully activate these new governance tools. During this phase, DReps will be able to register, gather support, and vote on proposals. SPOs will also get a say, using the $ADA (Cardano’s cryptocurrency) they control to influence decisions.

Moreover, the constitutional committee will expand beyond its initial seven members and gain full authority to veto decisions that don’t align with the community’s constitution. Additionally, the Cardano community will start managing the network’s treasury, which means they’ll get to decide how funds are used to support projects and improvements.

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Why This Matters

The Chang Hard Fork is a big deal because it sets Cardano on the path to being fully controlled by its community. Instead of relying on a central authority, Cardano’s users will have the power to shape the future of their network. Cardano’s long and careful process to become fully decentralized shows just how difficult yet important it is to uphold decentralization in the crypto space. Whether or not Chang can live up to its promises, its intention reflects the spirit of Web3 - one where the power is in the hands of the community. 

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