Recently, a token called NIGHT, which was listed for spot or contract trading on Bitget, Binance, OKX, and Bybit at the beginning of the month, saw its 24-hour global trading volume exceed $9 billion, approaching $10 billion. Bybit even surpassed Binance in 24-hour spot trading volume thanks to NIGHT.

NIGHT was officially launched on December 9. According to CoinGecko data, the token's price rose from around $0.025 to nearly $0.114 in less than two weeks, a increase of over 3 times. Its FDV also once exceeded $2.5 billion, which could rank it within the top 50 by market capitalization. As of the time of writing, the price of NIGHT has retreated to around $0.08.

Such performance from a token simultaneously listed on several major exchanges is not entirely unexpected, but what's interesting is that NIGHT is the token of Midnight, a privacy sidechain of Cardano. A project labeled with both "Cardano" and "privacy" having such explosive power truly surprising to most.

What Makes Midnight "Valuable"?

Midnight is a sidechain developed by Input Output Global (IOG, the parent company of Cardano) with "programmable data protection" as its core selling point. It packages zero-knowledge proofs (ZKP) into a ready-to-use TypeScript API, allowing Web2 developers to implement "selective disclosure" on-chain without needing to learn cryptography. The entire network uses Cardano as its consensus foundation and Halo2 as its ZK backend, adopting a dual-token model (NIGHT+DUST). Its goal is to first implement the "data availability without visibility" that enterprises care about most, and then gradually expand to scenarios like DeFi, RWA, and on-chain compliant identity.

Overall, it doesn't seem particularly unique. It uses ZKP for privacy technology, but it doesn't natively protect privacy; instead, it makes privacy features optional to meet practical needs.

IOG first publicly announced the plan to develop Midnight in November 2022, but it wasn't until nearly two years later, in October 2024, that the testnet was launched. This is indeed IOG's style—it took almost 5 years from announcing that Cardano would introduce smart contracts to actually implementing them, finally gaining smart contract functionality in September 2021, long after the bull market had cooled.

In May of this year, Midnight established a foundation, with Fahmi Syed, former CFO of the Polkadot development team Parity, as its chairman, indicating that the first step towards TGE had been taken. Just two days after announcing the foundation's establishment, Cardano founder Charles Hoskinson revealed plans to airdrop tokens to 37 million addresses on 8 major blockchains, stating that the airdrop would only target retail investors, with no VC participation in the project.

Perhaps what truly ignited market sentiment was Midnight's "massive airdrop." In addition to the airdrop, Midnight also distributed nearly 3 billion NIGHT tokens in cooperation with Binance, OKX, and Bybit. This large-scale approach, which contrasts sharply with the recent popular ICO models, has garnered a positive market response.

According to the block explorer, aside from the top three addresses which likely belong to IOG or the Midnight Foundation, the remaining top NIGHT holding addresses are relatively decentralized. Based on data provided on the official website, the author estimates that the tokens distributed through NIGHT's own airdrop and cooperative activities with exchanges amount to nearly one-third of the total supply (24 billion tokens), which can indeed be considered a massive effort.

Midnight's tokens are not limited to NIGHT; it uses a dual-token model of "NIGHT+DUST." This rare design is not due to some whimsical idea but rather to ensure compliance with regulatory requirements. NIGHT can be used for network governance, incentives, and generating another token, DUST. NIGHT itself is not related to privacy and supports on-chain auditing.

DUST, generated by holding NIGHT, is used to pay transaction fees, similar to Gas. Additionally, DUST will be used to pay for privacy fees—if one wants to add optional privacy features to on-chain transactions, they must pay DUST as a fee. DUST is automatically distributed to NIGHT holders' accounts as blocks are produced and "decays" over time to prevent malicious hoarding and network attacks.

Thus, Midnight's "equity" token, NIGHT, does not participate in paying on-chain transaction fees but exists solely as a governance token and for generating DUST, the actual on-chain fuel. DUST itself, as a "renewable resource" generated by NIGHT and decreasing over time, would be considered a resource rather than an asset under regulatory policies, meeting regulatory requirements in various regions.

Cardano to Heavily Invest in On-Chain Ecosystem Next Year

According to Cardano's roadmap, next year will be all about boosting on-chain activity.

First and foremost, as a foundation, Cardano will undergo a network upgrade to increase throughput to 1,000–10,000 TPS through parallel block processing and a layered structure for vertical scaling, while maintaining security and decentralization. Next is the mainnet launch of the protagonist of this article, Midnight. Cardano believes that Midnight's launch will bring more DeFi activity and TVL through its optional privacy features. Additionally, the Cardano Treasury will allocate funds to support the native issuance of major stablecoins like USDT and USDC on Cardano.

The last point, which the author finds most important, is that Cardano plans to focus on interoperability—not simple cross-chain functionality, but allowing users from other chains to interact directly with DApps on Cardano by consuming the Gas token of the source chain.

Last week, Cardano achieved atomic swaps between BTC and ADA through Fluid, not via cross-chain bridges, wrapped tokens, or centralized custody, but directly through underlying script-to-script transactions, which also somewhat benefits from Cardano's own UTXO ledger model. Two days ago, interactions between Cardano's stake pool operators and a Solana co-founder on X confirmed this development direction.

Accompanying the strategic and product plans is financial investment. The Cardano Foundation plans to increase its marketing budget by 12% and "make an appearance" at events like TOKEN2049 and Consensus. Venture Hub will also invest 2 million ADA to support startups and ecosystem projects. Furthermore, the Cardano Foundation plans to inject tens of millions of ADA into on-chain DeFi to improve liquidity and attract institutional participation.

From this perspective, driving up the price of NIGHT might just be the appetizer Cardano is serving for a series of plans. Perhaps in 2026, it's worth keeping an eye on this project, which launched its mainnet back in 2017 and has been almost forgotten by the mainstream Web3 market.