Cardano founder Charles Hoskinson has positioned Midnight Protocol as a cross-chain privacy infrastructure that could serve Bitcoin and the XRP Ledger. The protocol, originally developed as a sidechain for Cardano, is now being pitched as a shared technology layer rather than an ecosystem-specific tool.
What Happened: Cross-Chain Privacy Expansion
Hoskinson outlined the strategy in a Dec. 27 post on X, arguing that Midnight's zero-knowledge proof architecture could enhance competing blockchain networks.
He said integrating Midnight with the XRP Ledger would enable private, compliant decentralized finance that could challenge traditional banking systems.
The protocol would also add programmable privacy features to Bitcoin that the network currently lacks, according to Hoskinson.
He framed Midnight as a catalyst for Cardano itself, suggesting it could increase the network's monthly active users and total value locked by expanding the ecosystem's utility.
"Midnight makes what it touches better. Adding Midnight to XRP DeFi is going to blow the legacy banks out of the water," Hoskinson said. "Adding Midnight to Bitcoin gives the world Satoshi imagined possible.
Adding Midnight to Cardano supercharges our DeFi ecosystem and will 10x the MAUs, Transactions, and TVL as we are first to market with private DeFi at scale."
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Why It Matters: Real-World Asset Opportunity
Hoskinson identified the estimated $10 trillion real-world asset tokenization market as a primary target for Midnight's privacy-preserving design. He criticized traditional finance firms for partnering with the Canton Network, a permissioned blockchain, arguing that partial solutions fail to meet institutional adoption requirements.
"There are no half measures or half technologies. You need an end-to-end strategy, great partners, and great communities," Hoskinson said.
The approach marks a departure from Hoskinson's historical focus on building within the Cardano ecosystem exclusively.
By promoting Midnight as infrastructure for other Layer-1 blockchains, he is attempting to access liquidity and user bases beyond Cardano's network.
Speculative interest in Midnight's native token, NIGHT, has increased alongside the announcements.
The asset recently surpassed Bitcoin and Ethereum in search volume on the platform's trending list. However, the token has exhibited high volatility since launching earlier this month, declining more than 80% to $0.08 as of press time, according to BeInCrypto data.
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