The 21 October Counterfeit Block: What Happened and Where Every Coin Went

On 21 October 2026 at 14:17 UTC, block 1,860,181 created 105,000,000,000 BTCZ out of nothing. Release 2.3.1 fixes the bug that let it through and removes the block, so on the valid chain these coins never existed. We traced every counterfeit coin. This article covers what happened, what you need to do, and the full on-chain evidence.

Where things stand

• The network runs on 2.3.1 and the bug is fixed. The counterfeit block is gone, and blocks are coming at the normal pace again (block 1,860,239 at the time of writing).
• Mining pool: a 2.3.1 solo pool with no fee is open to everyone at stratum+tcp://144.91.117.181:3333 (Equihash 144,5). Use your own BTCZ t-address as the username, and every block you find pays you directly.
• Electrum server: a 2.3.1 Electrum server for BTCZ wallets runs at 144.91.117.181, port 50001 (TCP) or 50002 (SSL, self-signed certificate).
• Z-TEXT works normally on the valid chain.
• The wBTCZ bridge: what happens to the 150M wBTCZ minted against counterfeit deposits, for example whether they are burned, has not been decided yet. We will announce it separately.

What you need to do

• Everyone running BitcoinZ software must upgrade to BitcoinZ 2.3.1: nodes, mining pools, exchanges, wallet backends, explorers and Electrum servers. Older versions accept the counterfeit block, so they cannot be trusted to follow the valid chain.
• Wallet users: your coins on the valid chain are not affected. Most transparent transactions from that afternoon were confirmed again on the valid chain. Shielded transactions created between 14:17 UTC and the switch, including Z-TEXT messages, could not be carried over. If a shielded payment or message you sent then never arrived, send it again.

In short

• On 21 October 2026 at 14:17, block 1,860,181 created 105,000,000,000 BTCZ from nothing. It used five Sprout JoinSplit transactions with all-zero proofs that a block-validation bug let through.
• Release 2.3.1 fixes the bug and removes the block, so on the valid chain these coins never existed. If you run a node, pool or exchange wallet and have not upgraded, upgrade to 2.3.1.
• The attacker deposited 510,000,000 counterfeit BTCZ into the wBTCZ bridge. The bridge credited three of the deposits and minted 150,000,000 wBTCZ on BSC.
• The attacker sold the 150M wBTCZ on PancakeSwap for 2,892.18 USDT and sent the USDT to a deposit address at an exchange, possibly HitBTC (see section 6). HitBTC has been notified.
• Every counterfeit coin is accounted for. Apart from the 510M sent to the bridge, none went to SafeTrade, WhiteBIT or any other exchange, and none went into the shielded pool.
• The same person carried out the June 2026 Sprout theft (block 1,789,967, 56,305,778 BTCZ).

A correction to our June audit

On 9 June we published a security audit that found no way to counterfeit or inflate BitcoinZ. That finding was wrong. The review missed a bug in how the node checks blocks it receives from other nodes: the zero-knowledge proofs in Sprout transactions inside those blocks were never verified. The same bug was used on 20 June (block 1,789,967) and on 21 October (block 1,860,181). In October an integer overflow also stopped the supply “turnstile” from catching it. Release 2.3.1 fixes the proof check and no longer accepts Sprout JoinSplit transactions from block 1,860,181 on. We have added a correction notice to the audit pages.

The full on-chain report

No one is named here, only addresses and transactions. Every item below can be checked. All times are UTC.

How to check this report

• BSC transactions: each hash links to BscScan.
• June 2026 transactions (valid chain): links go to explorer.btcz.rocks.
• October BTCZ transactions: these exist only on the invalid chain that 2.3.1 removed, so explorers on the valid chain do not show them. A node that followed the invalid chain before upgrading still has its blocks on disk. bitcoinz-cli getchaintips lists 00000128b2118af53b80c50b389e19a2b29ca16843f356b167838bfe980b1738 (height 1,860,306) with status invalid, and bitcoinz-cli getblock <hash> 2 returns the full transactions. On a node with txindex=1, bitcoinz-cli getrawtransaction <txid> 1 works too.

1. The counterfeit block

None of the five counterfeit transactions has a transparent input. Each has one Sprout JoinSplit with vpub_new = 21,000,000,000 BTCZ, and each pays that amount to t1gcbk…. Across all five, the proofs, MACs and one-time public keys are all zeros, and the ten note commitments are simply the numbers 1 to 10. The txids are the first five rows of the table in section 2.

On the valid chain, block 1,860,181 is 0000055c669539bb6e35418f2fef774c89648048ab8e0a362b214c4122eb9052, mined at 22:22.

2. Every transaction that moved counterfeit coins

This is every transaction that touched counterfeit coins in blocks 1,860,181 to 1,860,306. Block 1,860,306 (19:36) is the last block of the invalid chain our node received. All 27 transactions spend only counterfeit coins; none mixes in other funds.

Addresses involved

Addresses in the attacker’s transaction chain (16): t1gcbkA2YNNgruDc8qmKJ7sQmFgPN2MCAdm, t1fKbsEov5FPYH7GW6zFDWPiYhvhMmCoyKr, t1ex16baKxSCmf3HfkTJSot32KxSFfyhiaJ, t1T8Jb8rqvjiKWK9hV5Y5TFdjVMqDCGnAtA, t1gQbotYbo9dRN1ZWrZ11SifKS7qCfBXKY9, t1QXQYCYxij74z7D8hFFsmFn8EooSc7XSWo, t1TBVKyeoxM5bQBSyb2GqDYfRfrjCg7kj8V, t1W74qv5aVK9VMnpGBwNwAgM9SH2q2SVWPf, t1Q7Zh31mWKmJAvbc9kqXguVwFUFDSR79Ze, t1VArYsAJPXzYTCUVp9bECL1krXF7UN2Wum, t1JG8FSdu5wuie6Pm7x2omuYpt4ETBiUKpf, t1LnyWNFanvWAWdapR5dc7TPaPS37BMFgMw, t1bU3uksVHEqyCNVgGgEBDooNuKCTVfUkqz, t1UvbyYfHU3BE2oZJRgcgXiGrXSAx9dsw8m, t1fjzdHebTmE8BKn4QkM9AY79DtaWfCp7mm, t1KgEFBAE9N1rV2gmNKefUcmP9V3n9m8Wob

wBTCZ bridge deposit addresses (7): listed in section 3.

wBTCZ bridge hot wallet: t1NZg8VE5UhqRyXGxqje518GjbZT1msiMvw

3. Deposits into the wBTCZ bridge

Each deposit was swept into the bridge hot wallet within minutes, minus a 0.0001 BTCZ fee. All of these transactions are on the invalid chain only.

Total: 510,000,000 BTCZ. The bridge credited three of the deposits on BSC: the 10M, the 50M and one of the 90M. The other four 90M deposits were not credited.

4. Bridge mints on BSC

• wBTCZ token: 0xcbbb3e5099f769f6d4e2b8b92dc0e268f7e099d8
• Bridge minter: 0xf9e15aab8d82d5e71fd763074f6bed8d5b48aedb
• Recipient (attacker): 0x00479d80b4f45730b637679a961f3e8a35af185c

The bridge records mints with its own event, not a standard Transfer from the zero address, so a plain token-transfer view may not show them. The rollback of the BTCZ chain does not reverse anything on BSC.

5. Sale on PancakeSwap

The attacker’s address sold all of it through the PancakeSwap pairs wBTCZ/USDT (0x7bd31069afb56370f6ab63ef3d66dcba5565ba73) and wBTCZ/WBNB (0x4e3459f55a72455598d4c26050b7b053a9dba162):

6. Where the USDT went

0xb3d3944b… is a deposit address: it received the USDT once and was swept into the hot wallet 0xe647b0db…. We found that this hot wallet possibly belongs to HitBTC: the public Safe Protocol Library dataset labels it as the HitBTC BSC hot wallet. We cannot confirm this ourselves, and HitBTC does not disclose account information to third parties.

HitBTC has been notified and will discuss the case only with the police. Officers handling a report should send their official request to HitBTC’s legal team at [email protected].

7. Where the counterfeit coins ended up

At block 1,860,306, the last block of the invalid chain:

The 0.00224495 BTCZ difference from 105,000,000,000 is transaction fees. All of these coins exist only on the invalid chain.

8. No counterfeit coins went to any exchange

• Counterfeit coins reached only 24 addresses: the 16 in the attacker’s chain, the 7 bridge deposit addresses and the bridge hot wallet.
• None went to SafeTrade, WhiteBIT or any other exchange, and none went into the shielded pool.
• The bridge did not send any of the counterfeit coins on.
• The attacker last moved counterfeit coins at 16:39 (block 1,860,241).
• On BSC, the attacker sold the 150M wBTCZ only on PancakeSwap, and the USDT went only to the deposit address in section 6.

Claims that counterfeit coins were deposited to SafeTrade, WhiteBIT or another exchange are not supported by the chain data.

9. Other trading in that window

The rest of the trading that day involved no counterfeit coins and no funds from the attacker’s addresses. That includes people selling BTCZ or wBTCZ, and buyers who bought wBTCZ cheaply on PancakeSwap and unwrapped it to BTCZ. Buying low and selling high is normal trading.

10. The June 2026 incident: same actor

In June, block 1,789,967 used the same bug to withdraw 56,305,778 BTCZ from the Sprout pool. These transactions are on the valid chain:

Exactly the amount that went into Sapling (56,308,277.99999) came back out to t1KgEFB… (1,000.00001 + 56,307,277.99998, before fees). t1a15oHAN… is a service address with 89,498 transactions since block 308,914.

In October, t1KgEFB… received 200,000,000 (tx d41f14e039d91f9b72fc56abff742cfe17b4e2c317d80eadca3891274b46ff6c, block 1,860,189) and 500,000,000 (tx 2194b3f87cef4d3331b194581db4521c23a815e633409c158a18bae5325455f4, block 1,860,241) of the counterfeit coins. The same person controls this address in both incidents.

If you lost funds or have information

• If you lost funds because of these transactions, file a report with your local police and cite this report and the transaction IDs above. The police can request the exchange’s records from HitBTC’s legal team at [email protected].
• If you run an exchange or service and any of these addresses appear in your records, keep those records. Law enforcement may ask for them.
• If you know who controls these addresses, contact the BitcoinZ team on Discord or Telegram.