The bridge connecting Cardano’s ecosystem to the privacy blockchain Midnight has been hit by an exploit that drained roughly 515 million NIGHT tokens from its treasury. Within hours of the detection, the token dropped more than 30% intraday to around $0.016, setting a new all-time low. At current prices, the stolen tokens are worth approximately $9 million. The original report by BlockSec’s Phalcon monitoring flagged the unusual outflow on the Wanchain Cardano bridge and pointed to a specific validator design flaw that attackers likely leveraged.
How the Exploit Worked
Initial analysis suggests the root cause lies in non-injective signed-message encoding inside the TreasuryCheck validator. This kind of encoding can allow signature reuse attacks, where a valid signature for one transaction is replayed to authorize another, unauthorized transfer. In bridge architectures that rely on validator signatures to confirm cross-chain withdrawals, a single slip in message construction can break the trust model completely.
The exploit emptied the bridge treasury, not individual user wallets. Yet the indirect hit arrived fast: holders of NIGHT faced immediate dilution and a rush to exit. Liquidity on decentralized and centralized venues thinned as the token slid to levels never seen before.
NIGHT’s Record Low and What It Means
NIGHT is the native token of Midnight, a privacy-focused blockchain incubated by Input Output (IO), the company behind Cardano. The project has been pitched as a confidential-computing sidechain where zero-knowledge proofs protect user data. Bridge infrastructure is essential for moving assets between Cardano and Midnight, so the exploit strikes at a core piece of the interoperability design. The token’s collapse highlights how fragile liquidity can be when a bridge—often the primary on/off-ramp for a smaller ecosystem’s asset—is compromised.
Traders who entered early Midnight allocations are now sitting on a position that lost a third of its market value in one day. While the stolen sum of $9 million may seem modest compared to nine-figure bridge hacks from previous cycles, the damage to confidence may end up costing the project more.
Bridge Risks Across Cardano’s Expanding Surface
The timing is uncomfortable for the broader Cardano ecosystem. Even as developer activity on the network stays among the strongest in the industry—something BlockchainReporter recently tracked—the bridge layer continues to present an unresolved attack surface. Bridges remain the most-attacked infrastructure in crypto, and the Cardano ecosystem, with its growing number of sidechains and connected networks, inherits that risk.
Cross-chain security has become an even more urgent topic as real-world asset tokenization expands. The latest tokenization figures show on-chain RWA value crossing $20 billion, a milestone that means bridges are no longer only moving speculative tokens—they are moving tokenized equities, bonds, and credit. A signature reuse flaw on a bridge that touches such assets would have far more severe consequences.
For now, the focus is on the Wanchain team and Midnight developers to clarify whether funds can be frozen or recovered and how the validator code will be patched. The market, meanwhile, has already repriced the risk. NIGHT’s recovery prospects depend on a transparent post-mortem and convincing technical remediation. Until then, the token is likely to trade under a cloud of uncertainty.
