Zano rolled back its blockchain to block 3,833,000 on Sunday, erasing roughly one month of transaction history after a vulnerability in its Gateway Addresses feature let attackers mint unauthorized ZANO and Freedom Dollar (fUSD) tokens.

The layer-1 privacy chain restarted at the last block before Hard Fork 6, the protocol upgrade that introduced Gateway Addresses in the first place. The core team told node operators, miners, stakers and exchanges to adopt the update that same day.

How big was the unauthorized mint?

Zano has not published a post-mortem or a final on-chain figure for the exploit, but the core team described the scale in stark terms. Head of marketing and growth Quinten van Welzen told Cointelegraph: "The total number of unauthorized assets was considerable."

Freedom Dollar is a stablecoin-style asset issued on the Zano network, and ZANO is the chain's native currency. Both circulated without limit while the exploit remained live, according to the team.

Why a rollback instead of a patch?

Van Welzen laid out the rationale on X, arguing that leaving the unauthorized tokens in circulation would permanently inflate supply and invite future exploits of the same kind.

"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," he wrote. "It would also tell every future attacker that exploited coins get to keep their value. No project survives that."

The team argued that letting the unauthorized tokens stand would have permanently inflated the supply of both assets. Reverting to the pre-fork state was the only path that restored the issuance schedule users signed up for, in the team's view.

What did the rollback cost?

The rollback invalidates every legitimate transaction between the Hard Fork 6 activation and block 3,833,000. Users who paid merchants, moved funds between wallets or settled trades during that window will find those records absent from the recovered chain.

The recovery cannot claw back payments already forwarded to other networks. Van Welzen confirmed that addresses flagged as active before the rollback are not active on the new chain and will resume working only after Zano's developers finish reviewing, auditing and testing the Gateway Address code.

Van Welzen acknowledged that the rollback sacrificed a month of trust alongside the history, but said it was the only path to restore supply and rebuild. He framed the choice as the lesser of two losses for a network that has run since 2019.

What happens next?

The Zano core team said it is still accounting for losses attributable to the exploit and will publish a reimbursement and claims process. Exchanges and custodians must install the updated client before resuming deposits and withdrawals, leaving the chain split between legacy and recovered networks until operators migrate.

Gateway Addresses were built to let bridges, exchanges and payment processors manage Zano-based funds through a single account-style balance rather than tracking individual UTXOs. The team has not said when the feature will be reintroduced.

Zano went live in May 2019 as a privacy-focused layer-1 network with confidential transactions, support for issued tokens, and the ability to deploy custom assets. The next milestone for the project is the publication of the reimbursement framework and the audited return of Gateway Addresses.