From time to time, the wikimedia servers will decide that a CAPTCHA is required to log in from toolserver hosts such as nightshade.toolserver.org. Once this happens, bots on the toolserver can no longer log in until the CAPTCHA requirement is (automatically) lifted. But there is nothing an individual bot maintainer can do to resolve the problem except turn off their bot and wait.
One solution would be to exempt toolserver hosts from the CAPTCHA, but that may not be the most desirable solution for various reasons. Maybe there's a better fix?
This is a tracking bug for possible solutions.