MIDNIGHT AIRDROP ($NIGHT)

🚨You can thank us later for this 👇

If you currently hold $BTC, $ETH, $SOL, $XRP, $BNB, $AVAX, $ADA and/or $BAT, you’re probably eligible for the Midnight ($NIGHT) airdrop.

👉And claims will go live in the month of August, here!

Putting crypto inside a Self-Directed IRA (SDIRA).

“Ok, cool. I love an airdrop… but what is Midnight, and why should I be holding it?”

– you, probably.

It all starts with two of crypto’s biggest problems:

1. Transactions aren’t private
2. Solid tokens tend to appreciate over time

Hold up… isn’t that last point a feature (not a bug)?

Yes and no.

See, any token worth its salt comes with a catch:

If it’s seen as a store of value (SOV), using it to pay to access onchain products and services (the life blood of any blockchain) can feel like a waste.

PLUS! All of those actions can be tracked back to your wallet!

So what would happen if you built the system out in two parts…

1. A store of value token
2. A private resource that is used to fuelfor onchain actions

…well, you’re about to find out.

‘Cause that’s exactly what Midnight has built with $NIGHT (a store of value) and $DUST (the privacy enabling capacity resource that is used to fuel onchain actions on the network.)

A 1000 ft view of Midnight’s functionality:

$NIGHT is designed to be held indefinitely, accruing value (and regenerating) $DUST on the holders’ behalf, over time (which they can then use for onchain transactions.)

I.e. You can have your cake (store value with $NIGHT), and eat it too (use your $DUST.)

Now, there’s a whooole lot to dig in to with Midnight, so let’s break it down into five segments:

• $NIGHT
• $DUST
• A closer look at network utility
• Midnight’s roadmap to decentralization
• The three phases of Midnight’s token distribution

Ready? Good. Let’s go. 👇

THE $NIGHT TOKEN 🌚

$NIGHT is the token that lies at the core of the Midnight network – it’s kind of like a Swiss Army Knife in token form…

The $NIGHT token:

• Generates $DUST for holders to spend
• Is designed to act as a store of value
• Provides voting rights to holders
• Has a supply of 24 billion tokens
• Doubles as a reward token for those helping to secure the network (similar to $ETH)
• Has an inflation rate that decays over time (part of the 24 billion supply will be used to reward validators – but these reward rates will go down over time, until they’re fully distributed)

While we’re on the topic of supply – let’s dig a little deeper…

The full 24 billion supply of $NIGHT will be minted on the Cardano blockchain at the beginning of the token rollout.

Once minted, this supply will be broken up into two categories:

• Uncirculated: these tokens will be used as incentives on a decreasing curve. Meaning the Midnight ecosystem will have high incentives in the early days (helping to attract network participants), but decrease as the network matures. (Similar to how Bitcoin did it.)
• Circulating: these are the tokens being airdropped to $BTC, $ETH, $SOL, $XRP, $BNB, $AVAX, $ADA and/or $BAT holders that meet a certain criteria (learn more here) – as well as the core constituents (foundation, Treasury, etc.), and anyone who participates in solving computational cryptographic challenges in the Scavenger Mine phase (read to the end to find out how you can take part.)

Ok, now – here’s how $NIGHT works across Cardano and Midnight…

The $NIGHT token will launch with a 24 billion supply on Cardano, and a mirrored 24 billion supply on Midnight (when the mainnet launches.)

That means $NIGHT will live on both blockchains as a native asset.

But hold up. My brain is wrinkling…

How does that even work?? It sounds like they’re about to double their token supply out of nowhere – and that’s no bueno.

Agreed. Zero bueno.

But Midnight has created a solution to mitigate such a problem.

Once in circulation, $NIGHT tokens will fall into one of two states:

• Protocol-locked: these can’t be moved or used for anything (e.g. generating $DUST or voting). I.e. – they’re pretty much un-usablein this state.
• Protocol-unlocked: these can be moved freely and used with full utility.

(All of which is only possible via a cross-chain observability mechanism that will initially allow Midnight to observe the state of Cardano to enforce these invariants.)

So at any one time, there will only ever be 24 billion unlocked/usable $NIGHT tokens (minus the Reserve - which consists of uncirculated tokens.)

At launch, there will be a one-way bridge, allowing users to move their $NIGHT from Cardano to Midnight, incentivizing users to make the jump.

If a $NIGHT token is unlocked on Cardano, it will be locked on Midnight. On the flip side, if it's unlocked on Midnight, it will be locked on Cardano.

Nice! Ok, now – what’s all this talk of $NIGHT generating $DUST tokens on behalf of whoever’s holding it?

(I like free stuff!)

Heard. Let’s get into it…

$DUST ✨

$DUST is a private, renewable capacity resource, with one job:

To let users fuel transactions, privately.

$DUST is a renewable resource tied to active/generating $NIGHT tokens. There can only be as much $DUST as there is $NIGHT in circulation and generating it.

Meaning there’s no absolute cap that any one wallet can hold in $DUST – but the limit is instead set by how many $NIGHT the generating wallet holds.

The cleanest analogy we can come up with for $DUST is that it’s like a battery storing energy – it lets things work, but fades over time (with or without use.)

Here’s a breakdown:

• Users hold $NIGHT…
• $NIGHT generates $DUST. The more $NIGHT you hold, the more $DUST you collect...
• You use $DUST to run transactions, but it fades over time the moment you stop holding $NIGHT, or start collecting $DUST in a different wallet...

And every time $DUST gets used, it gets burned, and validators are paid in $NIGHT.

But as we now know…

More $NIGHT being held → means more $DUST being generated → $DUST fades over time → which means it needs to be used.

It’s an interesting way to incentivize continued network activity, and opens up a whole range of applications.

E.g. Want to monetize your $DUST holdings? You can cut onchain or offchain deals to lease your $DUST rights to third parties (delegating your $DUST collection to their wallet.)

…or say you run a DEX and want to cover your customers’ transaction fees.

You could buy up a bunch of $NIGHT → use the $DUST it generates to cover customer fees → all while your $NIGHT tokens continue to (hopefully) grow in value.

Sure, there’s no guarantee that your $NIGHT tokens will grow or maintain their value over time – but it gets you closer to a revenue-neutral solution than simply wearing the cost yourself.

Plus, on top of all of that, $DUST is:

• Privacy first: transactions using $DUST don’t reveal wallet addresses, amounts, or timestamps – meaning none of your data is shown on the public ledger
• MEV-Resistant: because $DUST is private, it makes it hard for attackers to front run other users
• Non-Transferable: you can’t buy/sell/send or trade $DUST between wallets – it can only be used to fuel transactions – helping to keep it stable and free from market swings

Neat! So how does it all mix into one big ecosystem?

A CLOSER LOOK AT UTILITY/FUNCTION 🔍

This section feels like it could get dense, so let’s break it into three parts:

• Block Rewards
• Governance
• Onchain Treasury

(Ahhh, much better.)

Block Rewards

One big question we had when learning about $DUST was:

How the hell do network validators get paid if the $DUST tokens aren’t being exchanged for $NIGHT tokens, but instead getting burned?

(It’s not like if you exchange $USD for $CAD, that those US dollars go into a wood chipper – they remain in circulation…so what gives?)

That’s where the $NIGHT ‘Reserve’ comes in.

Midnight’s Reserve fund will pay $NIGHT to validators, while also helping to distribute the token over time.

When it runs out, all 24 billion $NIGHT tokens will be in circulation.

So what then? We’re not quite sure – but this Reserve distribution process will take hundreds of years to complete –so the network engineers have time to figure it out.

Governance

As the Midnight network launches, and starts distributing its remaining locked $NIGHT tokens, governance should gradually become more decentralized.

The goal is to get more people involved in shaping how the network runs, allowing $NIGHT holders to vote to update parameters, upgrades, forks, etc.

BUT! It’s worth noting:

$NIGHT won’t be used for governance at mainnet launch – this is currently planned for a future update (once the full governance system is ready.)

Onchain Treasury

Midnight’s Treasury is a pool of $NIGHT tokens owned by the network itself, and different from the Reserve.

It’s there to support the growth of the Midnight ecosystem by funding community projects, but only through decisions made via onchain governance votes.

Which means they’ll be locked until the decentralized governance system is up and running.

And this stepped rollout is also being applied to Midnight’s decentralization roadmap…

MIDNIGHT’S ROADMAP TO DECENTRALIZATION 🗺️

Alright, let’s rip the bandaid off…

When the Midnight Network launches, trusted permissioned nodes will handle block production (transaction processing.)

Good news is, these permissioned nodes won’t receive rewards, and the plan is to gradually move to a fully decentralized, permissionless system over time (where anyone/everyone can support the network and earn.)

As the network finds its feet, Midnight will start to open up block production to any Cardano Stake Pool Operators (SPOs) who want to participate.

(A shift that will likely happen through a hybrid phase, where both permissioned nodes and SPOs work together to validate blocks.)

These SPOs will then be eligible for block rewards, meaning they’ll be able to opt-in to validate Midnight blocks alongside Cardano, while collecting $NIGHT tokens on behalf of their pool.

THE THREE PHASES OF MIDNIGHT’S TOKEN DISTRIBUTION 🤝

Midnight’s token distribution is designed to be:

Free, inclusive (with plenty of time to participate) and broad (preventing any one group from gaining too much control.)

And it will be rolled out in 3 Phases…

Phase 1: The Glacier Drop

Supported Networks: addresses from Cardano, Bitcoin, Ethereum, Solana, Ripple, BNB Chain, Avalanche, and Brave are eligible – and you can claim from multiple addresses if each one qualifies.

Minimum Balance: at the time of a snapshot, each address must hold at least $100 worth of the native token of its network (e.g. $ETH, $BTC, $SOL), and will be based on prices pulled from CoinMarketCap at the time of the snapshot.

(This helps prevent spam and bots.)

Compliance Check: addresses on U.S. sanctions lists (OFAC SDN) or flagged by blockchain forensics firms (e.g. Chainalysis) won’t be eligible. But no personal info is required to claim – it's based entirely on onchain activity.

Community Safety: any address found to harm or burden the Midnight ecosystem may be excluded.

Allocation sizes:during the Glacier Drop, 100% of the total supply of 24 billion $NIGHT tokens will be made available for claim by eligible addresses on a per-network, native token balance-weighted basis. Though, the assumption is, the full 100% will not be claimed – and part of this remaining supply is what will help to fund the Treasury & Reserve.

(Here’s a breakdown of the allocation.)

$NIGHT tokens will be distributed across networks as follows:

• 50% to Cardano participants
• 20% to Bitcoin participants
• With the remaining 30% will be split among Ethereum, Solana, Ripple, BNB Chain, Avalanche, and Brave based on the USD value of eligible token holdings at the snapshot

👉Claim your allocation here (starting in the month of August)!

Phase 2: Scavenger Mine

Scavenger Mine allows miners to earn a share of any unclaimed tokens from Glacier Drop – with the lion's share going to the core constituents (Reserve, Foundation, Treasury) and an equal share going to the 3rd phase.

(The idea being: this bounty will help to attract validators to the new network.)

Participants complete tasks/puzzles requiring computing power → in doing so, they can lay claim to 1/30th of the share of GD-unclaimed tokens allocated to Scavenger Mine (alongside anyone else who completed the puzzles that day) every day, for 30 days.Cool part is: these puzzles will be carefully designed to ensure accessibility to the general public and prevent concentration of rewards being gobbled up by large mining operators

Phase 3: Lost-and-Found

The Lost-and-Found phase gives Glacier Drop-eligible users who missed the original 60-day claim window another chance to grab a reduced portion of their tokens.

The same amount of tokens allotted to the Scavenger Mine phase will be allotted to Lost-and-Found (with both phases having a guaranteed 1% of the total supply) and will open sometime after mainnet launches, staying open for 4 years before tokens are considered forfeited and swept to the onchain Treasury.

…so if you’re keen to get your hands on some $NIGHT, sooner rather than later – our suggestion is:

👉Claim it during the Glacier Drop phase, starting in August!

Alright, that’s everything we’ve got!

Hope you learned something & nabbed yourself an allocation. 🤝