Midnight: Compact DApps

Overview

Midnight Compact DApps is a strategic fund dedicated to building use cases and utility that will empower the future of privacy-enabled applications. This initiative leverages Catalyst's robust infrastructure and the wisdom of the Cardano community to help select the most promising projects that demonstrate the power of programmable privacy.

Budget & Constraints

• Total Budget: $USDM 250,000 
• Proposal Range: From $USDM 2,500 to $USDM 10,000
• Funding amounts are intended for small, focused prototypes, not full product builds.

Sponsored by a $USDM 250,000 commitment from the Midnight Foundation, this initiative aims to build foundational “Reference DApps” for the new ecosystem. The Midnight Foundation is looking to fund high-impact, open-source projects that directly demonstrate high-value use cases for privacy-preserving applications, laying the critical groundwork of basic UI design and prototyping.

Community Governance & Voting

To celebrate the collaboration between the Midnight and Cardano ecosystems, project selection will be a two-stage process:

1. Community Recommendation: Cardano's ADA holders will vote on proposals through Project Catalyst to create a shortlist of recommended projects.
2. Final Selection: The Midnight Foundation will make the final funding decisions from the recommended list on behalf of the Midnight Foundation.

Additional Notes

• Funding: This funding is provided under executive sponsorship from the Midnight Foundation in $USDM. No funds from the Cardano Treasury will be used for this category.
• Infrastructure: Project Catalyst will provide the voting platform on behalf of the Midnight Foundation. Catalyst voters will vote on the proposals submitted in this category, no different to other Catalyst funding categories, however the Midnight Foundation is solely responsible for funding decisions and disbursements.

Areas of Interest

This category focuses on funding the creation of open-source Proof of Concept (PoC) decentralized applications (DApps) to demonstrate how Midnight technology works in practice. The primary goal is to build a library of functional examples that showcase what is possible on Midnight and serve as a learning resource for future developers in one of the following areas using Midnight:

• Governance: Build civic platforms that protect participants while still preserving fairness and auditability.
• AI: Midnight provides a foundation where AI can scale without sacrificing privacy, ensuring that data can be used responsibly, securely, and in ways that align with user consent
• Health: use Midnight to build patient-owned data systems, research networks, and telehealth tools that simply couldn’t exist without privacy-preserving infrastructure.
• Finance: Midnight’s programmable privacy means builders can create compliant financial products that aren’t possible elsewhere like private credit markets, compliant DeFi rails, or new forms of digital banking.
• Innovative & Novel Concepts: Propose a creative concept that uniquely leverages Midnight’s privacy features in another industry or real-world privacy enabled use case.

What is a “Reference DApp”?

A Reference DApp is an open-source, Proof of Concept application built to demonstrate how to use Midnight’s technology in practice. It is not meant to be a polished product or a company. Instead, its value lies in:

• Clarity: showing other developers how to implement a specific pattern (selective disclosure, privacy in finance, governance flows).
• Reusability: providing code that others can fork, remix, or extend.
• Education: acting as a practical example alongside documentation and tutorials.
• Demonstration: proving out Midnight’s unique features with Compact contracts and a simple demo UI.

A good reference DApp should be small in scope but technically complete. Enough that another developer could run it locally, see it working, and adapt the code for their own project.

Core Eligibility: Who Can Apply?

This category is for the builders. To be eligible, you and your project must meet the following criteria:

• Technical Focus: You must be proposing a functional software prototype with code as the primary outcome. Non-technical projects (marketing, content-only, community ops) are not eligible. 
• Verifiable Identity & Experience: Anonymous or unverifiable teams are not eligible. The proposal must include verifiable identity and references (e.g., comprehensive LinkedIn profiles, GitHub profiles, project portfolios) that clearly demonstrate each key team member's specific experience and suitability for their role. Simply listing names/aliases is insufficient.
• Direct Builders Only: Proposals must be submitted by the builders who will perform the core work. Outsourcing the primary development to a third party agency is not permitted.
• A 3-month timeline: The project delivery timeline can be a maximum of three months with three milestones each (one per month).
• Open Source Commitment: All code produced must be under a permissive open-source license (MIT or Apache-2.0) and source available from day one.
• Maintain Good Standing with Catalyst: The lead proposer and all named team members must be in full compliance with commitments for any previously funded Catalyst projects. Proposers can verify their compliance status by reviewing their reporting dashboard on the Project Catalyst platform. All milestone reports for previously funded projects must be submitted and approved on time prior to this fund's submission. Learn more about it here.

Proposal Requirements

All proposals must provide the following information:

• Demonstrate Novelty & Privacy Rationale: Propose a unique, novel project (not a minor tweak of an existing Midnight reference dApp). If inspired by other ecosystems, clearly explain what’s different and why it matters here. Explain why privacy improves this DApp; show you’ve thought through selective disclosure/programmable privacy. Don’t treat Compact like TypeScript. They are distinct; proposals must use Compact for ZKPs.
• Define Target Audience: Clearly describe both the target end-user of the DApp and the developer personas who will learn from your code repository. 
• Provide Verifiable Team Credentials: Link to GitHub profiles, past projects, or code samples that prove your team has the technical ability to deliver the project. 
• Detailed Project Deliverables: All final projects must include the following technical baseline:
• Compact contract: At least one *.compact smart contract demonstrating programmable privacy/selective disclosure.
• Demo UI: A simple UI in the repo that calls your Compact contract and shows a demo flow.
• Wallet integration: Integrate with the Lace (Midnight) wallet.
• Open-source repo: Public code with a permissive OSI license (MIT or Apache-2.0).
• Robust README.md: What it does, why privacy matters, how to run locally, key files, and suggested next steps/extensions.
• Test Suite: Tests for the contract (sample inputs/outputs for privacy features) with clear instructions to run tests.

Self-Assessment Checklist

Use this checklist to ensure your proposal meets all foundational and content requirements before submission.