Midnight Suspends Glacier Drop Redemptions

The Midnight Foundation has temporarily suspended redemptions for its Glacier Drop token distribution program. 

The decision follows reports of a security breach involving EMURGO’s neo-financial platform, SecondFi. According to the Midnight Foundation, the suspension serves as a precautionary measure designed to protect users while investigations continue and additional safeguards are introduced.

Rationale Behind the Suspension

In the latest update, the Midnight team clarified that the reported security issue does not involve its own infrastructure, products, or services. However, the incident impacts certain wallets connected to SecondFi, a wallet used by some Glacier Drop participants.

Consequently, the Midnight Foundation decided to pause all Glacier Drop redemptions to minimize potential risks to users. While acknowledging that the temporary halt also affects users who were not impacted by the breach, the foundation emphasized that suspending redemptions remains the safest course of action for the broader community.

Meanwhile, the team stated that it intends to resume redemptions once it determines that conditions are safe enough to proceed.

SecondFi Hack Drained More Than 16 Million ADA

The development comes roughly a week after SecondFi, formerly known as Yoroi Wallet, suffered a sophisticated attack that drained more than 16 million Cardano coins (ADA) from 374 addresses.

Following an internal investigation, SecondFi traced the root cause of the exploit to an address-level vulnerability. According to the company, the affected software signer contained a deterministic nonce derivation flaw. Each time an address signed a transaction, the flaw leaked enough information for attackers to mathematically reconstruct the address’s private key using publicly available blockchain data.

As a result, SecondFi advised affected users not to transfer assets to other platforms or import their recovery phrases into alternative Cardano wallets until the recovery process is completed.

Glacier Drop Redemption Schedule Faces Temporary Interruption

Against this backdrop, Midnight has taken precautionary steps to halt Glacier Drop redemptions.

Although the Glacier Drop officially launched on August 5, 2025, Midnight adopted a phased redemption structure in which distributed tokens gradually thaw and become redeemable in four equal quarterly installments of 25% each.

The first redemption window ran from December 10, 2025, to March 9, 2026. The second redemption phase followed from March 10, 2026, to June 7, 2026.

The program is currently in its third thaw period, which began on June 8, 2026, and is scheduled to continue until September 5, 2026. The final redemption phase will commence on September 6, 2026, and conclude on December 4, 2026.

For now, Midnight confirmed that the suspension will remain in place until the SecondFi security incident is fully resolved and sufficient safeguards have been implemented.

SecondFi Launches Recovery Process

In the meantime, the SecondFi team has initiated a recovery plan with an estimated two-week timeline. 

As part of the process, the engineering team plans to release a mechanism early next week that will allow users to determine whether their wallets were affected by the exploit. The company also intends to introduce a secure migration procedure that will enable users to safely move their assets out of the platform.

Until these recovery tools become available, SecondFi continues to urge users not to take any action with their wallets or funds.