If PFMS passes on Cardano... this isn't just wasteful spending—it's embarrassing. This isn't 2019, when projects like hospital data storage, anti-fraud coupons, or logistics record services were trending... To allocate 2.5 billion KRW to a project that puts police records on-chain... I simply cannot understand the rationale for investing such a large sum in an asset no one in the market even considers viable.
As I've said several times, the core issue is that this proposal brings no meaningful users or liquidity. The 1.53M transactions and the 18.2% are nothing more than projections. And these are simple record-keeping transactions that have nothing to do with users or liquidity. Let me go through your claims one by one. 1. It's called an open-source public good, but only 28% of the budget (2.68M ADA) goes to reusable core infrastructure. 38% (3.65M ADA) goes to Telangana systems integration, testing and connectors, and the work package document says "state specific connector configurations are kept private." Put simply, every state that wants to use this public good will face the same integration cost again, and it'll end up back at the treasury. If a single state government needs this, it should be built with government money. Even if the treasury funded the core, there's no reason for it to cover integration costs. And this model has never produced real revenue as a sold solution. The market moved past it long ago, and even a finished product won't set Cardano apart. 2. The processes needed for record-keeping come standard with any notarization system. When I said "record-keeping," I was describing the service at a high level, not saying things like identity binding or gap detection aren't needed. Even so, the cost is way too high, it's not a compelling product in the market, and none of these mechanisms bring users or liquidity into the Cardano ecosystem. 3. The 1.53M transactions is a projection. What the contract actually guarantees is 390K over three months at M4. At that point the full 9.6M ADA has been paid out, and there's no obligation to sustain volume after that. The "+18.2%" figure is also calculated against the lowest possible baseline of about 700K a month. Against the last 12 months' average, it's around 13%. Projections shouldn't be presented as facts. And again, these aren't transactions from active users, and they don't represent liquidity. They're simple transactions for posting records. One-dimensional transactions that don't directly contribute to the Cardano ecosystem. 4. The government pays nothing for development, and Trivolve collects the maintenance revenue. What comes back to the treasury is fees worth tens of thousands of ADA a year, plus an optional verification service starting at $1.89 per request. To recover $2.2M at the minimum price, you'd need 1.66M paid verifications, which is more than the annual transaction count. If this project really benefits the government, the government should procure it. There's no direct contribution to the Cardano ecosystem. And even if the project completes successfully, market demand isn't high enough for it to serve as a public good, and only 28% of the requested budget actually goes toward that public good. In 2019, this might have been a model worth considering. But today there are far more important and attractive institutions and businesses that directly contribute to the ecosystem. The Cardano treasury isn't deep enough to put this much money into an outdated model that doesn't directly contribute to the ecosystem.
To put it more bluntly, once you take away the "Indian state police" title, PFMS leaves very little behind for Cardano. Record-keeping projects don't bring in meaningful liquidity or users, and they don't generate volume that matches the investment. Right now we're about to spend precious treasury funds on a use case that's already behind the times. I think that 9.6M $ADA should go somewhere more meaningful.
We’re in a position where we’d be spending 9.6M $ADA on a proposal that doesn't bring in users or liquidity, doesn't directly add to network volume, and doesn't improve the developer experience for builders. Put simply, a project that records police evidence for one Indian state benefits that state's public agencies more than the Cardano ecosystem. If that's the case, those agencies should be the ones paying for it. I think that 9.6M ADA could go somewhere far more valuable for Cardano. We should be focusing on projects that create a positive cycle: new products get built, users and liquidity come in, that activity refills the treasury, and the treasury gets reinvested in the next wave of growth.
First, record-keeping products are a simple model the market already tested and moved past a long time ago. Even when you sell them as a solution, they rarely turn into real revenue or profit. Back in 2019 there were tons of blockchain solutions for hospital records, anti-counterfeit coupons, logistics data and so on. Most of them are gone now. The model just doesn't work in today's market. Second, even if this passes, it's not a project that puts Cardano on the map. Record verification can run on any chain, so it doesn't show off anything unique about Cardano or add to its value. Third, the transaction volume is tiny compared to the investment. On top of that, transactions get batched, and agencies will push batch sizes as high as they can to cut costs. So even after 9.6M ADA, real volume is very likely to be ridiculously low. Lastly, even if other governments use this framework, there'll be more costs to integrate it with their legacy systems. You don't just build it once and plug it in elsewhere. Every new government needs its own integration work, and that's exactly what this proposal is asking us to pay for. If we fund things just because they use the Cardano network, there's no proposal we could ever say no to. And again, this isn't even a good reference case. Look at DTCC on Canton. America's securities clearing and settlement giant, processing quadrillions of dollars a year, just started tokenizing US Treasuries on Canton with more than 30 financial institutions. That's the kind of use case we should be chasing. And I don't think landing something like that would even take 9.6M ADA. We need to be realistic. There's no reason to spend a limited treasury on proposals with no numbers and no results.
Thanks for the reply. Honestly though, it gives me even less reason to support PFMS. I don't see how it helps the Cardano ecosystem. 1. Most of the costs you described are device-specific CCTV adapters, CCTNS and Dial 100 integration, and local legal compliance. That's SI work tailored to the Telangana police system, and even if it gets reused, it'll be for your next government client, not for Cardano. The Cardano-specific part is basically hash anchoring. This kind of work should come out of a government procurement budget. I don't see why the Cardano treasury should pay for it. 2. You said the rules are enforced by on-chain smart contracts. Can you point to the actual evidence? The on-chain records I found from IndianChain are Merkle roots in metadata, with no script execution. Even in the architecture you described, the PartnerChain handles operational state and Cardano only stores hashes. Cardano ends up as a record-keeping layer. 3. I'd also like to see the basis for 1.53M mainnet transactions a year. If records are batched into Merkle roots, it's hard to see how you'd get anywhere near that number. I'd expect the real impact on mainnet volume to be minimal. 4. You framed the government covering 100% of operating costs and fees as a plus, but that's just expected. There's no reason for the treasury to cover those costs too. Bottom line, this is a simple record-keeping use case that doesn't bring in liquidity or users and doesn't add much to network volume. I think it should be funded through government procurement, and I'm keeping my vote at No.
The Cardano treasury is limited. Any governance action should clearly show what it contributes to the ecosystem. Just using the network isn't enough. It should bring in real users and liquidity, drive network volume, or at least improve things for builders. It shouldn't just benefit individuals or for-profit companies. Ecosystem growth comes first right now, and spending with unclear contribution needs to stop. As a DRep, part of my job is making sure the treasury is used efficiently, so I hope you understand why I'm being conservative here.
Personally, I’m most concerned about the quantum computing risk to $BTC. Some say that if Bitcoin gets hacked, all bank accounts will be drained too—but that’s a one-dimensional view. Systems managed by specific organizations can quickly update their security protocols. As CZ said, it’s easier to encrypt than to decrypt—centralized systems can respond rapidly. The problem lies with networks like Bitcoin, which require consensus from a vast majority. Even the quantum-resistant proposal, BIP-360, hasn’t been activated yet, and there’s still no agreement on when or how to implement it. The critical issue is that over 1.7 million BTC are already in addresses where public keys have been exposed. What I fear more than Bitcoin being hacked is the market-wide collapse triggered by the shock of such an event. Let me be clear: Bitcoin is neither a perfect technology nor a perfect network. The longer upgrades are delayed, the more it becomes a legacy network rapidly falling behind. The very feature that was once its greatest strength—having no governing entity—has ironically turned it into the most vulnerable network in the face of quantum computing.
