Fahmi Syed talk about Midnight: “Zcash on Steroids”

Fahmi Syed, wey be president for the Midnight Foundation, describe Midnight as “Zcash on steroids” for interview with Jesus Martinez, wey announce the conversation on October 11. As dem discuss the presentations for TOKEN2049 for Singapore, Syed explain how programmable privacy, Midnight Passport, and private trading tools take connect with AI agents, financial services, and the foundation partnership with Monument Bank.

Syed background include Marshall Wace, chief financial officer role for Parity, and work for Midnight inside Input Output before e come lead the foundation.

Midnight, Zcash, and the Network Economics

“Midnight na all about privacy, but na privacy wey you fit program,” Syed explain. E start from shielded environment wey users fit decide wetin dem wan disclose publicly, to counterparty, or to defined group. Custodian or tax accountant fit check relevant records without make am public, and user fit prove say e qualify inside one jurisdiction without expose full financial history.

Permissioned corporate blockchains get different wahala for im account: fragmentation. How Morgan Stanley private network wan take build trust and communicate with JPMorgan own? E still compare reach Monero, wey im privacy dey cause wahala for exchanges and regulators, and Zcash, wey get shielded and unshielded options. Aleo and similar approaches make am ask question about private execution wey still involve publicly visible token.

House be im analogy. Person fit remain private inside house, but observer wey see am comot by four o’clock and come back 15 minutes later go get window to investigate. Public transaction traces, e argue, fit still give similar clues. Midnight shielded execution be like person comot under “invisibility cloak.” The network token still public for this explanation, while developers fit build shielded or unshielded stablecoins and tokenized assets.

Syed give Zcash credit for the pioneer work and their shared use of Halo 2 cryptography, describe Midnight as Zcash with smart contracts and selective disclosure. “Zcash on steroids” na im formulation. When dem ask am about competition and Charles Hoskinson optimistic comparisons, e answer say e wan build “the first Midnight.” “E good make people dey think of us like Zcash, but na winning I care about.”

Institutional demand, for im view, dey come from practical confidentiality requirements. Hedge funds need protect strategies, banks no fit expose payroll, and companies wan keep commercially sensitive information. For healthcare, e include transfer of records between providers, find clinical trial participants, and share research without expose personal or commercial data. E still call Midnight potential “VPN of DeFi” for borrowing and lending.

For distribution, Syed outline how Glacier Drop design reach holders across eight blockchain ecosystems, and later dem expand participation through Scavenger Mine. E report say dem don distribute more than four billion tokens and hundreds of thousands of participants join. The original claim process don close, but existing allocations still dey become available through quarterly installments. Another Lost and Found process still possible, but full details never announce by that time.

Im estimate put community allocation for more than 20%, or approximately 25%, through Glacier Drop, Scavenger Mine, and participating exchanges.

The remaining allocations go to the foundation, treasury, and block production rewards. E add say the treasury go remain locked until the network don mature, with governance later go enable ecosystem funding. E describe the March mainnet launch as deliberately guarded, using federated nodes while security reviews go support gradual removal of restrictions and path toward more validators and fuller governance.

On network economics, Syed explain say holding NIGHT go generate DUST, renewable resource for transactions. Developers fit estimate demand and plan the holdings wey dem need to support their applications, give dem better predictability around capacity and costs. For holders, e expect staking within six to 12 months after the interview.

Midnight Passport and Control Over AI Agents

Question of control still shape Syed criticism of technology platforms wey dey accumulate data through free or cheap services. For im account, the value wey come out dey benefit their operators pass. Institutional privacy fit protect those accumulated records even as customers still dey surrender information. For individuals, e link privacy to freedom of association, commerce, and expression, cite private communication, newsletters, and political organizing wey reveal identity fit get consequences.

Martinez introduce AI through story of Midnight City agents wey engage 20 people to represent the project for TOKEN2049 because dem no fit attend physically. For Syed, the example raise practical question: how much access agent suppose get to im owner identity, money, and data? Beyond the entertainment part, Midnight City serve as environment to study agents behavior and interactions before dem handle real funds.

Midnight Passport supply the identity and permissioning component. Syed compare the intended phone and computer experience with Apple ID or Google ID, using cryptographic proofs of identity, ownership, and access rights wey fit support delegated authority. As e refer to presentation the day before the interview, e outline connections to Grok, Claude, and other AI systems. Agent fit receive authorization to trade and proof of sufficient funds without see the user wallet, total balance, or transaction history, na wetin e claim.

Martinez ask how this one different from MCP connection or exchange API key. Syed distinction center on proving specific requirements, including sufficient funds, adequate margin, and jurisdictional eligibility, while e limit disclosure of broader financial information. “I no need show you everything wey I own,” e explain. Corporate cards illustrate the boundaries: chief marketing officer fit get $10,000 limit, while junior employee get $500. Both fit act for the company but within different permissions.

The same principle, for im vision, go govern trading, healthcare access, wallets, and agents. E mention MetaMask and Solana wallets side by side with Midnight, with restrictions wey intend to prevent unauthorized spending and limit information wey reach AI provider. The commercial concern big pass when provider fit aggregate financial data from thousands or millions of users.

Conversation for brokerage event for Singapore give example of how disclosure fit affect pricing. Client fit allocate 20 million USDT to one broker, while public transactions reveal identical payments to four others. The broker fit infer say $100 million dey available and say dem control one-fifth of the business. Tighter spreads and better execution fit help win $25 million or $30 million for the next allocation.

Another client fit provide the same amount, but public data suggest say na their entire holdings e be. Since e no look like competition dey for the capital, the broker for Syed account get less incentive to offer equally competitive terms. The story illustrate im argument say make users decide wetin counterparties suppose know about their finances. E apply the same reasoning to trading strategies: public activity fit invite copying or trades against investor position, while privately controlled strategy fit potentially dey available to others through agent or leased capability.

Private Markets and Monument Bank Roadmap

Martinez still challenge Syed on how research and development go translate into value for token holders, as e cite Near as network wey attract attention through revenue-generating activity. Syed give Near credit for their development of intents and praise Ilya and im team. For Midnight, e identify Nightmode, Collateral Warehouse, and Midnight Passport as potential sources of revenue for the network and foundation, plus opportunities for developers to build businesses.

Private trading intents be part of that financial model. For the dark pool arrangement wey e outline, order go remain off-chain until dem find partial or complete match, with settlement wey protect the participants information. E link the mechanism to tokenized private equity, hedge funds, and private credit, argue say fractional ownership and lower operational friction fit extend access beyond very wealthy clients.

Redemption periods create separate wahala for those investors. Fund fit require 30 or 90 days before dem return capital, even when holder wan exit immediately. Through Offer Files, Syed explain, that investor fit privately offer the holding to another buyer, possibly accept 5% or 10% discount. Matching offers fit support secondary market without broadcast every seller intention.

Collateral Warehouse go address financing through shielded vault for collateral and margin management, allow participants to negotiate without expose their positions. Trading commissions don compress, Syed observe, while financing, securities lending, and leverage still remain significant businesses. Im ambition na make Midnight tools work together across those activities, wey e express as make one plus one equal three.

For Syed, that infrastructure suppose finally operate for background. “Good technology dey invisible,” e talk, compare the intended experience with Uber or Grab: customers care say the car arrive and reach destination, no be about the systems behind am. Intel inside Dell and Hewlett-Packard computers give another analogy. E report conversations with banks, healthcare companies, and clinical trial organizations, allow for multiple winners and tie Midnight growth to success of partners wey dey use im infrastructure.

Monument Bank, the regulated British digital bank, give am concrete example of that partnership model. Syed outline three phases, start with tokenized retail deposits wey e expect to launch for the weeks after the interview. The second go introduce shielded financial products, including money market funds, private equity, and hedge funds. Private “sovereign zone” for Monument and im customers inside the public network go support movement between deposits, stablecoins, and investments while e restrict access to sensitive information.

The third phase, wey e place for the following year, go introduce Lombard lending against pledged assets. “The wealthiest people for the world no dey sell to buy. Dem dey leverage and borrow to buy,” e talk. E use Elon Musk acquisition of Twitter to illustrate im argument about borrowing against existing wealth. For customers wey otherwise suppose sell one investment before dem make another purchase, asset-backed lending go allow the original holding remain inside the portfolio.

E tie Monument lending plans to Collateral Warehouse and financing with controlled disclosure, describe the aim as “using your assets, your wealth, to borrow and create more wealth in a controlled and private way.”