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What is a Dawnwalker
A Dawnwalker is a being who exists between human and vampire. They carry traits of both and can walk in daylight and darkness, something full vampires cannot do. The condition is the result of a vampire turning that neither completed nor catastrophically failed. It stalled partway, leaving the subject in a stable but hybrid state.
Known Dawnwalkers
Two Dawnwalkers are known to exist. Coen was created when Brencis attempted to turn him into a vampire, but years of silver poisoning from mine work disrupted the process. Saint Mihai, the patron saint of Svartrau's cathedral, is revealed during the game to be a Dawnwalker who was buried alive in the crypt centuries ago. He survived the entombment, sustained by his hybrid nature.

The existence of a second Dawnwalker means the condition is not unique to Coen's specific silver-poisoning circumstances. It has happened before, possibly through different mechanisms. Whatever interrupted the turning in both cases, the result was the same, a being caught between two states.
How the turning normally works
To create a vampire, the sire pulls out one of their own fangs and pierces it through the target's heart. The fang then "sprouts like a seed, unfurling thin, seeking tendrils" that penetrate every part of the body, changing and remodeling it. The transformation happens slowly and gradually over the course of the vampire's endless life. No one truly knows what the transformation's end goal is.
Vampire teeth are not the traditional two fangs of popular culture. In this world, vampires grow a series of needle-like fangs from different parts of their skull as they age. The older the vampire, the more fangs they grow. Pulling out a fang to create a new vampire is a real physical sacrifice.
Dawnwalker vs. murohni
When a turning goes wrong in a different way (when a fang breaks off during feeding and lodges somewhere other than the heart) the result is a murohni. The vital energy in the tooth explodes all at once, violently deforming the host into a mindless, blood-thirsty beast. Murohni lack self-preservation and eventually wander into sunlight and burn.
The distinction between a Dawnwalker and a murohni appears to be one of balance. Murohni are catastrophic failures (the transformation went violently wrong. Dawnwalkers are incomplete transformations) the process started correctly but was interrupted before it could finish. The difference in outcome is enormous.
Abilities
During the day, a Dawnwalker is effectively human. Coen uses swordplay and hex magic runes carved into his skin that serve as conduits for offensive, defensive, and investigative spells.

At night, the vampire side emerges. Coen gains vampiric powers: Shadowstep, Plane Shift, Plague Shift (bat swarm), Clawride, and Voracious Bite. His hex magic rune scars seal shut as vampiric regeneration takes over. His own body heals the wounds that channel his human magic.
Aging
Dawnwalkers age significantly slower than normal humans. This has been confirmed by the developers, who hinted it could carry implications for sequels. Saint Mihai's survival for centuries in the cathedral crypt is physical proof of how far this slowed aging extends.
Weaknesses
The blood craving is the most dangerous liability. As hunger grows, self-control weakens, and Coen can involuntarily drain NPCs. A Dawnwalker is weaker than a full vampire at night and more vulnerable than a normal human during the day. The hybrid biology carries liabilities from both sides.