SecondFi, a self-custody platform, has warned affected users not to claim upcoming NIGHT allocations from compromised wallets.
Some users can claim their NIGHT tokens on Tuesday, September 22 through the original addresses linked to their allocations.
The allocations came through Midnight’s Glacier Drop program for eligible users.
Attackers compromised those addresses during SecondFi’s June 21–23 security incident.
Midnight’s claim system requires each allocation holder to use the original wallet address. Users cannot transfer an allocation before completing the claim.
Therefore, affected users cannot move NIGHT to newly secured wallets before redemption. SecondFi has advised them to avoid claiming while the issue remains unresolved.
SecondFi said it contacted the Midnight Foundation to explore alternative claiming options. Midnight controls the NIGHT redemption process and its requirements.
SecondFi cannot change those rules or redirect allocations to different addresses. The company directed users seeking another claiming method to Midnight’s official channels.
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Why Users Cannot Move NIGHT to Safe Wallets
SecondFi’s Wallet Migration Tool cannot move an unclaimed NIGHT allocation to a newly secured wallet.
The tool handles eligible ADA, Cardano native tokens, and non-fungible tokens (NFTs) that remain inside SecondFi wallets. It does not control allocations that Midnight manages through its redemption system.
Therefore, affected users cannot use the migration tool to secure NIGHT before claiming it.
SecondFi’s Asset Recovery Tool also cannot process an unclaimed NIGHT allocation. The company uses that system to handle eligible assets affected by the June incident.
Midnight controls NIGHT allocations and their redemption process instead. The tokens remain outside compromised wallets until users complete the Midnight claim.
Midnight launched its mainnet in March as a privacy-focused network using zero-knowledge (zK) technology.
The network distributes NIGHT to eligible users through scheduled claims. SecondFi said its recovery tools cannot protect NIGHT before users complete Midnight’s redemption process.
The company has asked affected users to wait for verified guidance.
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What Happened in the SecondFi Wallet Breach
The NIGHT claim issue follows the SecondFi security incident that occurred between June 21 and June 23.
An EMURGO-commissioned investigation found that attackers stole about 16.1 million ADA from 374 wallets.
Investigators traced the incident to a flaw in SecondFi’s transaction signature process. The stolen ADA had a value of roughly $2.4 million.
Groom Lake reviewed SecondFi’s code, development history, and public Cardano blockchain records during the investigation.
Investigators found that the flaw could allow attackers to derive private key material from public transaction information.
The investigation found evidence of two separate attackers targeting SecondFi wallets. Investigators described the primary operation as sophisticated, external, and well-funded. They also assessed possible links with activity associated with the DPRK-linked Lazarus Group.
SecondFi moved about 129 million ADA to an independent third-party custodian during its emergency response.
The company also developed a recovery portal that uses zero-knowledge proofs to verify ownership of compromised wallets. I
ts migration tool allows users to move eligible ADA, Cardano native tokens, and NFTs into new wallets. Users must handle non-Cardano assets through their respective networks.
SecondFi told affected users to retain their seed phrases because its recovery process may require them.
The company also warned users about fake recovery services and impersonators seeking wallet credentials.
