The inaugural Midnight Summit was a key event in sharing everything that’s coming up for the Midnight network, sharing the vision and the strategic path forward. In the opening keynote, Midnight Foundation President Fahmi Syed defined the "Why," articulating the core philosophy of rational privacy and cooperative economics and the critical need to move beyond the binary of total secrecy or total exposure.
Subsequently, Input Output Founder Charles Hoskinson charted the "When," outlining the roadmap and the four phases that will guide the network from its current state to a fully decentralized mainnet.
With the vision established and the course set, the focus shifts to the "How."
Delivering rational privacy requires a fundamental reimagining of blockchain architecture. To explain the engineering behind this vision, the summit welcomed Bob Blessing-Hartley, CTO of Shielded Technologies. His technical vision demonstrated how the Midnight network is built to reconcile the competing needs of users, developers, and regulators without compromise.
→ Watch keynote on X (starts at 4min 40s)
What is the privacy trilemma?
For Web3 to mature into a global infrastructure capable of handling real-world commerce and identity, privacy must become embedded into the core of the network. It must be invisible to the user, yet robust enough to satisfy both personal freedom and regulatory requirements.
This trilemma consists of:
- Programmability: The ability to run complex logic and applications (smart contracts) directly on the blockchain, rather than simply transferring value.
- Privacy: The capacity to protect sensitive data such as financial details, identity, or proprietary business logic from public exposure on the ledger.
- Compliance: The capability to satisfy legal and regulatory requirements, such as identity verification, audit trails, and data residency laws, enabling legitimate enterprise adoption.
Solving the privacy trilemma
The Midnight network is architected to resolve the "trilemma" that has historically fragmented the blockchain space:
- Bitcoin and Ethereum: Offer programmability and compliance, but lack native privacy.
- ZCash and Monero: Offer privacy and compliance, but possess limited programmability.
- Midnight: Delivers privacy, programmability, and compliance simultaneously.
This capability is the result of a core architecture built on: Programmable privacy, cooperative economics, advanced tooling, and governance.
NIGHT and DUST
To sustain a privacy-first network, Midnight employs a dual-component economic model designed to align the incentives of users, builders, and validators.
NIGHT is the native utility token of the network. It is a UTXO-based token with a supply of 24 billion. NIGHT serves two critical functions: it grants governance rights to its holders, and it acts as a generator for the network's operational resource, DUST.
DUST powers smart contract execution on Midnight. As Bob explains, “You don't have to hold NIGHT to be able to transact on Midnight, you don't even have to know that Midnight is there. For application developers, this is a key advantage for you being able to have self-funding DApps.” This means NIGHT token holders can use their DUST-generating NIGHT to continually power DApps.
The NIGHT token distribution has seen participation from millions of addresses, and Bob explained the significance of this distribution of that for powering DApps in the future: “You can take the NIGHT that you claim, and use that to fuel your DApps, so that nobody ever has to pay for a transaction on Midnight to use your application.”
The DUST resource
DUST is the fuel that powers the network's privacy-enhancing operations. It represents a paradigm shift in transaction fee mechanisms. Unlike traditional gas models where tokens are burned or paid to validators, DUST is a renewable resource.
DUST is generated proportionally to a user’s NIGHT holdings. It operates on a "recharge" model similar to a battery. Once used, it regenerates over time until it reaches capacity again.
This separation of capital (NIGHT) and operational fuel (DUST) unlocks distinct advantages for the ecosystem including:
- Self-funding DApps: Developers can hold NIGHT to generate the DUST required to for the transaction costs for their users, removing friction for onboarding.
- Preserving governance rights: Using the network does not require spending the utility token. Users and businesses can transact without eating away at their role in the governance of the network.
Privacy-first smart contracts and the Compact language
To enable programmable privacy, Midnight uses Compact, a domain-specific language designed for developing privacy-preserving smart contracts. Compact is part of the Minokawa project, recently moved under the stewardship of the Linux Foundation Decentralized Trust.
Current smart contract models often force developers to choose between public code (verifiable but transparent) and private circuits (private but difficult to program). Compact bridges this gap. It allows developers to define both private state and public state within a single contract.
When a Compact contract is compiled, it generates two distinct outputs:
- Verifier code: Runs publicly on the blockchain to validate the transaction.
- Prover code: Runs locally on the user's device to generate a cryptographic proof.
This architecture ensures that while the computation is proven to be correct, the underlying private data is never revealed to the network. The language utilizes a restricted syntax to ensure safety and verifiability, preventing common classes of smart contract vulnerabilities.
Enabling compliance without compromise
Regulatory compatibility is not as an obstacle, but as a necessary feature for global adoption. The "all-or-nothing" transparency of previous generations is incompatible with laws like GDPR or HIPAA.
Midnight’s architecture enables selective disclosure. This allows builders to create applications that are compliant by design for any jurisdiction.
- The network enables regulation by providing tools for proof and verification.
- It transforms auditability from a passive vulnerability into an active, selective feature.
- It enhances programmability by treating privacy as a composable building block.
Build what was impossible
The Midnight network exists to provide the tools that make privacy programmable and easy to embed into core infrastructure. This removes the burden from the end-user, allowing ordinary people to interact with digital services without needing to think about data protection.
The talk includes an invitation to the builders. The infrastructure is now available to create applications that were previously impossible: applications that protect freedom, enable commerce, and respect the user.
Build on Midnight.