Token Transfers Skill

Midnight has two distinct token systems that operate independently: ledger tokens (NIGHT, UTXO-based, native to the chain) and contract tokens (account-based, ERC-20-style, implemented in Compact). They work differently, transfer differently, and serve different purposes.

Primary references:

• docs.midnight.network/concepts/ledgers — ledger vs contract token model
• docs.midnight.network/concepts/utxo — UTXO mechanics and nullifier set
• docs.midnight.network/concepts/dust-architecture — DUST generation lifecycle
• docs.midnight.network/concepts/zswap — atomic swap and shielded transfer protocol
• github.com/OpenZeppelin/compact-contracts — reference FungibleToken implementation

1) Two Token Systems — Which One You Need