Setting up a new development environment can either take a few minutes or turn into hours of frustration. The difference usually comes down to having clear, structured guidance instead of jumping between scattered documentation. This guide is designed to give you a smooth, beginner-friendly path to setting up your environment for building on Midnight Network. By the end, you’ll have everything installed, configured, and ready to start writing your first smart contract using Compact.

What You’ll Install

Before we begin, here’s a quick overview of the tools you’ll need:

• Node.js (v22+) – Runtime for development tools

• Compact Compiler – Midnight’s smart contract compiler

• Docker – Runs the proof server

• Proof Server – Generates zero-knowledge proofs

• VS Code Extension – Improves development experience

• Lace Wallet – Manage test tokens and interact with apps

Let’s go step by step.

1. Install Node.js

Midnight development requires Node.js version 22 or higher.

Check your version:

node --version

If you don’t have the correct version, install it using nvm (Node Version Manager):

curl -o- https://raw.githubusercontent.com/nvm-sh/nvm/v0.40.1/install.sh | bash

# Restart terminal, then:
nvm install 22
nvm use 22

node --version

You should now see v22.x.x.

💡 Windows users: Use WSL2 (Ubuntu). Midnight tools do not run properly in PowerShell or Command Prompt.

2. Install the Compact Compiler

Compact is Midnight’s smart contract language. It compiles your code into Zero-Knowledge Proof circuits, which power private transactions.

First, ensure curl is installed (Linux/WSL):

sudo apt-get update && sudo apt-get install -y curl

Then install Compact:

curl --proto '=https' --tlsv1.2 -LsSf https://github.com/midnightntwrk/compact/releases/download/compact-v0.4.0/compact-installer.sh | sh

Reload your terminal:

source ~/.bashrc

Update and verify:

compact update
compact --version

3. Install Docker

Docker is required to run the proof server in an isolated environment.

• Download Docker Desktop

• Install it for your OS

• Make sure it is running

Verify installation:

docker --version

💡 WSL users: Install Docker on Windows, then enable WSL Integration in Docker settings.

4. Start the Proof Server

The proof server is essential—it generates cryptographic proofs for your transactions.

Run:

docker run -p 6300:6300 midnightntwrk/proof-server:7.0.0 -- midnight-proof-server

Or run in background:

docker run -d -p 6300:6300 midnightntwrk/proof-server:7.0.0 -- midnight-proof-server

Check running containers:

docker ps

5. Install the VS Code Extension

To make development easier:

1. Download the Compact .vsix extension

2. Open VS Code → Extensions

3. Click ... → Install from VSIX

4. Select the file

Test it:

mkdir ~/compact-test && touch ~/compact-test/test.compact

Open the file in VS Code — it should show Compact syntax highlighting.

6. Install the Lace Wallet

The Lace Wallet is used to manage tokens and interact with Midnight apps.

Steps:

• Open Google Chrome

• Install Lace from Chrome Web Store

• Create a wallet

• Save your seed phrase safely (offline!)

7. Get Test Tokens

To interact with the testnet, you’ll need test tokens.

Steps:

1. Open Lace

2. Copy your wallet address

3. Visit the Preprod Faucet

4. Request test tokens (tNIGHT / tDUST)

Wait a few minutes for them to arrive.

8. Verify Your Setup

Run these commands:

node --version
compact --version
docker --version
docker ps

Also check:

• VS Code → syntax highlighting works

• Lace wallet → shows test balance

If everything checks out, you’re ready to build

Common Issues (Quick Fixes)

• Docker not running → Open Docker Desktop

• compact not found → Fix PATH

• Permission denied →

  chmod +x ~/.compact/bin/compact
  

• WSL file issues → Use code . inside WSL

Conclusion

You now have a complete development environment for building on Midnight Network. While the setup may seem technical at first, each component plays a key role in enabling privacy-preserving applications powered by zero-knowledge proofs.

With everything installed and verified, you’re ready for the next step: writing and deploying your first Compact smart contract.

Get everything you need here: https://docs.midnight.network/getting-started/installation