Charles Hoskinson Positions Midnight Protocol as a Cross-Chain Privacy Layer Beyond Cardano

Cardano founder Charles Hoskinson is promoting his latest venture, Midnight Protocol, as a major step beyond being just another Cardano sidechain. Instead, he is positioning Midnight as a cross-chain privacy infrastructure designed to bring programmable, compliant privacy to multiple blockchain ecosystems, including Bitcoin and the XRP Ledger.

In a December 27 post on X, Hoskinson explained that Midnight’s zero-knowledge proof architecture is built to enhance existing blockchains rather than compete with or replace them. According to him, Midnight can serve as a shared privacy layer that strengthens rival networks by adding features they currently lack, particularly around confidential transactions and regulated decentralized finance.

Hoskinson argued that integrating Midnight with the XRP Ledger could significantly improve XRP DeFi by enabling private yet compliant financial applications, potentially allowing blockchain-based systems to compete more directly with traditional banking infrastructure. He made a similar case for Bitcoin, stating that Midnight could introduce programmable privacy capabilities that Bitcoin does not natively support, helping move the network closer to the original vision of private, permissionless finance.

Beyond cross-chain interoperability, Hoskinson emphasized Midnight’s potential impact on Cardano itself. He suggested that the protocol could dramatically increase Cardano’s monthly active users, transaction volumes, and total value locked by expanding the ecosystem’s functionality beyond its native chain. In his view, private DeFi at scale could give Cardano a first-mover advantage in an area with growing institutional and developer interest.

Hoskinson also highlighted the opportunity in real-world asset tokenization, a market he estimates at around $10 trillion. He argued that privacy-preserving infrastructure like Midnight is essential for institutions entering blockchain, criticizing traditional finance firms for relying on permissioned solutions such as the Canton Network, which he described as incomplete.

This strategy represents a notable shift for Hoskinson, who has historically focused on building within the Cardano ecosystem. By positioning Midnight as a universal privacy layer, he aims to tap into broader liquidity and user bases across multiple Layer-1 networks.

The pivot has fueled speculation around Midnight’s native token, NIGHT, which recently surged in search interest on CoinGecko. However, despite the attention, NIGHT has shown significant volatility, with prices reportedly down more than 80% to around $0.08 at the time of writing.