Every day it's either 'the rational privacy revolution', or 'the institutions' favorite', or 'the mainnet is coming by the end of March', making it seem like it's about to change blockchain history. After watching for a while, I just can't help but express my thoughts—it's not purely black, just peeling back this project to show everyone whether it's a dark horse or a thunder.
Let me briefly explain what this project is all about.
@MidnightNetwork is a partner chain developed by Charles Hoskinson's team on Cardano, focusing on a concept called 'rational privacy'.
In simple terms, it neither wants to be as completely anonymous as Monero, nor does it want to be fully transparent like a regular public chain, but instead uses zero-knowledge proofs to allow users to selectively disclose information, proving that you are compliant, of legal age, and have payment capability, while keeping the specific details hidden.
They have created a dual ledger, allowing developers to write privacy contracts using a Compact language similar to TypeScript, along with dual tokens NIGHT and DUST, where holding NIGHT automatically generates DUST as fuel.
It does sound like there's something to it, especially for scenarios like institutions, RWA, and medical data.
But the more I look, the more something feels off.
First, let's talk about trading volume and liquidity; currently, the 24-hour trading volume looks like 270-320 million dollars, mainly supported by Binance.
But if you really look at the pool depth, especially for the main trading pair NIGHT/USDT, the buy order depth is only around 200,000 to 300,000 dollars; a slightly larger order can cause noticeable slippage.
With such shallow liquidity, the price is prone to avalanche at the slightest disturbance; this is not an asset that institutions would love to play with. It's clearly a game between retail investors and market makers.
Looking at the unlocking pressure, it's simply a ticking time bomb.
Glacier Drop directly released over 450 million NIGHT, unlocking in four phases every 90 days, extending to the end of 2026. The current circulating supply is 1.66 billion, with a total supply of 2.4 billion; each unlocking means several hundred million tokens hitting the market.
The promotion says 'the DUST model is long-term friendly,' but who can withstand this selling pressure in the short term?
After listing, it halved more than 60% from its peak; once the trading volume collapses, it directly leads to an avalanche.
The mainnet progress also doesn't make me smile.
Charles personally stated at Consensus Hong Kong that the Kūkolu federal mainnet will launch at the end of March, with a beautiful node list that includes big players like Google Cloud, Blockdaemon, and MoneyGram. But upon closer inspection, this federal mainnet essentially still relies on trusted nodes to run first; complete decentralization will have to wait until the second half of the year.
To put it bluntly, it's about using it in a centralized way first and seeing how it goes. From last year to this year, the community has been teased repeatedly by words like 'imminent', 'coming soon', and 'countdown', and now it's happening again.
As for the ecosystem deployment, let's not even mention it. ShieldUSD is still in testing, GalaxySwap claims it will go live soon but hasn't shown any signs yet, and there are pitifully few real dApps.
The TVL is still in the early stages of minor skirmishes; while the developer threshold is low, we haven't seen any truly killer applications yet. Competitors like Aztec and ZEROBASE are accelerating, and Midnight's 'rational' positioning sounds grand, but its actual deployment speed is so slow that it raises doubts.
Of course, I'm not saying that Midnight is worthless. The concept of rational privacy is indeed more realistic than pure privacy coins, and Cardano's low fees and security foundation are still there. If the mainnet can indeed launch steadily by the end of March, and the first batch of dApps can emerge, it really has the potential to become part of the privacy track.
But as it stands, the promotion is clearly greater than the substance. The ability to create a false narrative is top-notch, the node list looks good, and the AI demonstration videos are flashy, but the real trading volume, liquidity, unlocking pressure, and deployment performance are increasingly leaving people uncertain.
My current mindset is: brothers who want to play suggest starting with a small position and deciding whether it's really worth it after the mainnet launches. Don't let the words 'rational privacy' cloud your judgment; if you end up losing money rationally, that would be too rational.