{"id":492170,"date":"2025-08-10T21:00:46","date_gmt":"2025-08-10T20:00:46","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=492170"},"modified":"2026-06-09T14:44:01","modified_gmt":"2026-06-09T13:44:01","slug":"is-cardanos-midnight-worth-the-hype","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/is-cardanos-midnight-worth-the-hype\/","title":{"rendered":"Is Cardano’s Midnight worth the hype?"},"content":{"rendered":"

The following is a guest post and analysis from Shane Neagle, Editor In Chief fromThe Tokenist.<\/em><\/p>\n

On June 23rd, Midnight Foundation released its first tokenomics paper. Earlier in June, Charles Hoskinson, the co-founder of Ethereum (ETH) and founder of Cardano (ADA), pegged Midnight as \u201cthe single biggest event in the history of Cardano,\u201d with a caveat: \u201cif it is successful.\u201d<\/p>\n

Although the altcoin season had a pullback this week<\/a>, and the crypto market is more diluted than ever with tens of thousands of tokens, it is worth investigating new projects. After all, the exit of the Biden administration represents the departure of a hostile force that used many underhanded tactics to debank<\/a> crypto projects.<\/p>\n

In that light, what is the merit behind Midnight?<\/p>\n

Cardano\u2019s Need for Midnight<\/h2>\n

It is no secret that the Cardano blockchain is generally perceived as lagging behind other networks such as Ethereum or Solana. By total value locked (TVL), Cardano ranks 20th according to DefiLlama, with $360 million in capital across ~50 dApps. For comparison, Solana has a TVL of $10 billion across ~240 dApps, which is again 8x lower than Ethereum.<\/p>\n

This lack of significant market share is largely attributed to Cardano\u2019s robust academic approach to smart contract development and blockchain frameworks, ensuring that the network has all its ducks in a row to avoid reputation-disabling vulnerabilities down the line.<\/p>\n

Charles Hoskinson also noted the lack of stablecoins as a contributing factor, having floated the idea of converting around $100 million worth of ADA tokens into USDM stablecoins, which are issued by the regulated Moneta Digital LLC service.<\/p>\n

Moreover, if scaling of Cardano goes as planned, in addition to the inflow of stablecoins post-Genius<\/a> and Clarity Acts, Hoskinson boldly forecasted<\/a> that the altcoin market will see trillions of value\u2014and that Cardano is expected to play a major role in it. But what is Midnight\u2019s role?<\/p>\n

Midnight\u2019s Background and Pitch<\/h2>\n

Midnight is closely tied to Cardano\u2019s IOHK (Input Output Hong Kong), later rebranded as Input Output Global (IOG). While the Swiss-based Cardano Foundation is in charge of developing the blockchain ecosystem, such as adoption and community-building, IOG is the software engineering organization behind Cardano\u2019s core tech and roadmap.<\/p>\n

As the current president of the Midnight Foundation launched in May, Fahmi Syed served within IOG to push the project, in addition to contributing to Polkadot and Kusama via Parity Technologies. Prior to Syed\u2019s crypto involvement, he was the chief operating officer (COO) at UK-based Fifthdelta, which emerged as a startup from Citadel money managers in 2021.<\/p>\n

Midnight Foundation pitches the network as a \u201cfourth-generation blockchain built for secure, compliant, and private decentralised applications.\u201d What does that mean exactly?<\/p>\n

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  1. TradFi has been notoriously cautious to adopt blockchain because the default one is too transparent. Both Ethereum and Bitcoin have transactions publicly visible, which doesn\u2019t lend itself to safeguarding customer data and financial privacy.<\/li>\n
  2. Midnight aims to step into this gap by providing programmable privacy, utilizing zero-knowledge proof cryptography<\/a>. This tech enables data\/transaction verification without revealing identity, making it regulatory-compliant in the process.<\/li>\n<\/ol>\n

    Specifically, Midnight Network uses ZK-SNARKs (Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge) with its own smart contract programming language, Compact. Although zero-knowledge proof is more computationally intensive off-chain, this tech reduces on-chain load without requiring a trusted setup (depending on the variant used).<\/p>\n

    Per transaction, this approach exerts higher fees due to higher computational costs, but ZK-rollups turn this around by bundling many transactions into a single cryptographic proof. Ultimately, this reduces on-chain load and transaction costs.<\/p>\n

    In short, the purpose of Midnight is to act as a bridge between private and public ledgers, eliminating the exposure of on-chain transactions. The key to furthering that goal is Midnight\u2019s Zswap ledger, which facilitates atomic token swaps.<\/p>\n

    After all, atomicity<\/a> is crucial for cross-chain transfers between multiple token types and privacy layers. Overall, this makes Midnight Network a promising project. It is worth remembering that the ideal scenario for the crypto market to thrive is to create a cohesive blockchain ecosystem in which users seamlessly transact between different parts.<\/p>\n

    Midnight\u2019s Ecosystem Rollout<\/h2>\n

    At press time, Midnight listed 52 dApps across infrastructure, DAO, DeFi, wallets, NFTs, prediction markets, gaming, AI, and other areas that benefit from programmable privacy. As with many other crypto projects, Midnight is unrolling two types of tokens:<\/p>\n