The 24-year-old arrived at Rodney Parade from Llanelli in September on a one-season contract because of a back row injury crisis.
He will make his 18th appearance against Leinster on Friday, has been rewarded with a new Dragons deal.
"I was given an opportunity to prove myself as a professional and hopefully I have done that," said Cudd.
The former Scarlets academy product has impressed this season and been one of the success stories of the season for the Dragons.
"We haven't had the best of results this season but I think it is going well for me on a personal front," said Cudd.
"I have had plenty of games and feel that I am improving as a player.
"Over the past few months I have improved in terms of physicality and carrying the ball."

The forward, who turns 37 next week, has played over 500 games since joining his hometown club as a teenager.
"It's what I and the club wanted. I thank them for giving me another chance to wear the shirt of the only team I've ever supported and loved," he said.
Francesco Totti is 47 goals away from becoming Serie A's all-time leading goalscorer. Ex-Lazio, Torino and Juventus striker Silvio Piola, who played between 1929 and 1954, leads the way with 274 strikes.
The ex-Italy international made his Serie A debut aged 16 in March 1993.
Totti has scored 228 goals for Roma, putting him second on the all-time list of leading Serie A goalscorers.
He played a key role in Roma's 2000-01 title win and also helped them to six runners-up spots between 2002 and 2010.
And the five-time Italian Footballer of the Year, whose new deal runs until the end of the 2015-16 season, has started all three matches of Roma's 100% winning start to the Serie A season under new manager Rudi Garcia.
"I have another two years of responsibility and I know that we can do great things here," he said ahead of Sunday's Rome derby against Lazio.
"So far this season we've got off on the right foot, we have a manager who wants his team to play and demands respect, which we haven't had recently."
Totti won 58 international caps for Italy, retiring shortly after helping them win the 2006 World Cup.

UK-based Chatham House says more needs to be done to protect key transport routes such as the Panama Canal, the Suez Canal and the Turkish Straits.
Almost 25% of the world's food is traded on international markets.
This, the report says, makes food supply and prices vulnerable to unforeseen crises or climate change.
Infrastructure at the chokepoints is often old and would struggle to cope with natural disasters which are expected to grow in frequency as the planet warms, the report authors add.
They urge governments to invest in "climate-resilient" infrastructure, and diversify food production and stocks.
The report gives examples of how reliant the world is on this trade:
"The risks are growing as we all trade more with each other and as climate change takes hold," says Laura Wellesley, one of the study's authors.
There are risks for both the food security of importing countries and the economies of those exporting food, she added.

Fe gysylltodd teulu Elen Jones, 36 oed a'i mab wyth oed, Lewis Rhys Jones gyda'r heddlu i ddweud nad yw'r ddau wedi cael eu gweld ers dydd Mawrth 17 Ionawr.
Mae'n debyg bod y ddau yn teithio mewn car Citroen Zara aur, gyda'r rhif VRN YS52VTV.
Mae'r Heddlu'r Gogledd yn gofyn i unrhyw un sydd â gwybodaeth i gysylltu â nhw ar 101 gan ddyfynu'r cyfeirnod V009157.
Flanker Nic Cudd has signed a new two-year deal with the Newport Gwent Dragons.
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Roma captain Francesco Totti has signed a new two-year contract which ties him to the Italian side until just before his 40th birthday.
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The world's food security is increasingly reliant on 14 "chokepoints" for trade, a think-tank report has warned.
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Mae 'na bryderon wedi eu codi am fam a mab o Borthaethwy ar Ynys Mon sydd ddim wedi eu gweld ers rhai dyddiau.