Zano, a privacy-focused layer-1 blockchain, has restarted its chain from block 3,833,000 after a vulnerability in its Gateway Address feature allowed unauthorized ZANO and Freedom Dollar (fUSD) tokens to enter circulation. The rollback, executed Sunday and visible on the project's block explorer, invalidates roughly one month of network history — legitimate transactions included — according to Cointelegraph and crypto.news.
The restart point sits immediately before Hard Fork 6, the upgrade that introduced the affected Gateway Address feature. The recovery requires participating nodes, miners, stakers, exchanges and other services to adopt the updated software, the team said on X.
Why a Rollback
The team's stated rationale was supply integrity: leaving the unauthorized tokens in place would have broken Zano's fixed-supply promise.
"Doing nothing meant unauthorized ZANO and fUSD in circulation without limit, diluting every holder and breaking the most basic promise a currency makes: a fixed supply," Zano's head of marketing and growth, Quinten van Welzen, said. "It would also tell every future attacker that exploited coins get to keep their value. No project survives that."
"Restarting the chain from before Hard Fork 6 costs a month of history, and it costs trust, which we'll have to earn back," van Welzen added. "But it restores the supply everyone signed up for, and it leaves a path to rebuild."
What Gateway Addresses Were Meant to Do
No post-mortem has been published yet, but the team confirmed the issue originated in Gateway Addresses, a feature built to make integration easier for bridges, exchanges and payment services. It let those services manage funds through a single account-style balance — the model used by most other blockchains — whereas ordinary Zano wallets previously tracked funds as separate transaction outputs (UTXOs) that services had to scan, track and select manually.
Zano launched in May 2019 as a layer-1 focused on private payments, using a hybrid proof-of-work and proof-of-stake design. Its standard private transactions conceal senders, receivers, amounts and asset types. Freedom Dollar is a custom token deployed on the chain, which also allows users to mint custom assets.
The Cost of Rewinding
The rollback's trade-offs are material. Transactions made during the erased month will no longer appear on the recovered chain, and payments already settled on other blockchains cannot be reversed. The team said it is working to account for losses from the restart and will publish a reimbursement and claims process.
The incident is a rare live example of a whole-chain rollback as an incident-response tool — a choice larger networks have generally avoided since the Ethereum DAO fork debate, and one whose success depends entirely on how many miners, stakers and services adopt the recovered chain. Until the claims process lands and a post-mortem explains exactly how the Gateway Address flaw was exploited, the security takeaway is structural: new account-model abstractions layered onto a UTXO chain expand the attack surface for every bridge and exchange that touches them.
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