Charles Hoskinson, founder of Cardano, has released a new whitepaper on the highly anticipated Midnight tokenomics.

The founder of Cardano (ADA), Charles Hoskinson, has presented a new whitepaper about the much-anticipated tokenomics called Midnight. The report explains how Night (a token designed to drive value and governance) and DUST (a new type of protected asset to power transactions) function financially.

The NIGHT token has a fixed supply of 24 billion, minted on Cardano and split between Cardano and the new Midnight network through a cross-chain mechanism designed to prevent double-counting or exploitation.

The primary function of NIGHT is to generate DUST, which acts as energy rather than currency. Unlike standard gas fees, DUST is produced by holding NIGHT, meaning users do not spend the token to use the network. The more NIGHT held, the more DUST is generated, making it easier to predict network performance even in volatile market conditions.

The distribution begins with the “Glacier Drop,” a free token airdrop for eligible users on Cardano, Bitcoin, Ethereum, Solana, and other chains. After that comes the “Scavenger Mine,” which grants unclaimed tokens to those who contribute processing power.

Finally, there is a long-term “Lost-and-Found” phase to recover those who missed their initial opportunity. All NIGHT tokens claimed during the first two phases will unlock gradually over 360 days following the mainnet launch, with a 90-day grace period to redeem them.

Regarding block rewards, Midnight will use a decelerating emission model controlled by an on-chain reserve fund. Therefore, the initial block producers will not receive rewards, but eventually, Cardano SPOs will be able to participate and earn NIGHT through a combination of fixed subsidies and usage-based incentives.

This technical report is not only about the introduction of a token but about the launch of an entire parallel economic system. How this will affect the original Cardano (ADA) remains unknown.