Zilliqa has suspended native ZIL transactions after disclosing a critical vulnerability in its Ledger application that can allow attackers to recover private keys from public transaction signatures. Ledger hardware wallets are among the most widely used cold-storage devices in cryptocurrency, making the scope of potential exposure significant for any project whose signing app contains such a flaw.

The flaw affects native, non-EVM Zilliqa transactions signed with Ledger devices and applies to every released version of the Zilliqa Ledger app from 2019 through 2026. Zilliqa said accounts that signed roughly five or more affected native transactions with Ledger devices should be treated as permanently compromised.

The network said it detected onchain activity consistent with active exploitation on July 19 and confirmed the root cause on July 21. Zilliqa has prepared a corrected Ledger app build, but said the fix cannot protect keys already exposed through earlier signatures. Native transactions remained suspended in the latest official update while the team finalized a coordinated recovery plan.

South Korean exchange Upbit has also placed ZIL under cautionary status, while Zilliqa said EVM transactions and its software development kits are not affected.

Ledger app flaw weakened native transaction signatures

The vulnerability involved the way the Zilliqa Ledger app generated Schnorr signatures for native transactions. Each signature requires a fresh random number, known as a nonce, to help protect the private key. According to Zilliqa, the app generated enough random data but copied the wrong 32 bytes into the signing process.

That error left the highest 64 bits of every nonce fixed at zero. The reduction in randomness allowed attackers to compare multiple public signatures from the same account and reconstruct the account's private key. Biased or reused nonces are a recognized class of cryptographic flaw documented across multiple blockchain implementations over the years; once sufficient biased signatures are public, the underlying private key can fall without direct access to the signing device.

Zilliqa said accounts that broadcast roughly five or more affected native transactions should be considered compromised. The project said that, once enough signatures are available, the recovery process can take seconds on ordinary hardware.

Because affected signatures are permanently recorded onchain, updating the Ledger app cannot repair a key that has already been exposed. Zilliqa said affected keys must be retired. It also warned users not to simply move funds when transactions restart, because an attacker with a recovered private key could attempt to broadcast a competing transaction.

Native transfers halted as EVM transactions remain unaffected

Zilliqa suspended native transactions after identifying the vulnerability, blocking further native transfers while the team works on a method to protect affected balances. Unlike a smart-contract exploit or network-level outage, this vulnerability compromises the signing keys themselves, meaning affected addresses cannot be secured by simply patching software or upgrading firmware. The project asked Ledger users who signed native Zilliqa transactions to wait for official instructions.

“Users who have signed native Zilliqa transactions with a Ledger device should await official guidance before taking any action,” Zilliqa noted.

Zilliqa said the issue does not affect EVM transactions. The project also said its software development kits, including zilliqa-js, gozilliqa-sdk and pyzil, generate nonces correctly. Users who transact only through EVM-compatible tools are therefore outside the affected signing path.

Nonce-Generation Vulnerability in the Zilliqa Ledger App: A critical vulnerability has been identified in the Zilliqa Ledger application affecting the generation of Schnorr signatures for native (non-EVM) Zilliqa transactions. The vulnerability causes signatures to be generated… — Zilliqa (@zilliqa) July 22, 2026

Zilliqa credited KuCoin with helping trace the issue. The exchange recovered affected private keys from public signatures, helped confirm active exploitation and assisted in identifying the faulty nonce-generation process. Zilliqa said the cooperation helped it introduce protective measures while preparing a broader recovery plan.

Upbit places ZIL under cautionary status

Upbit placed ZIL under cautionary status after the vulnerability became public. The designation applies to its KRW and BTC markets, while ZIL deposits and withdrawals remain suspended. Trading support could face further review if the issue is not resolved through the exchange's monitoring process.

The exchange action came as Zilliqa continued working to secure balances controlled by keys that may already be recoverable. Although a corrected Ledger build has been prepared, the project has not yet published its full recovery procedure or announced when native transactions will resume.

As crypto.news reported on July 20, Zilliqa had already asked exchanges to pause ZIL deposits and withdrawals after an exchange partner reported a cold-wallet theft. At that time, the project had not disclosed the stolen amount, the affected exchange or the attack method. Zilliqa has not publicly stated whether that earlier theft was caused by the Ledger flaw.

Vulnerability follows earlier Zilliqa disruptions

The Ledger vulnerability differs from previous Zilliqa outages because it affects private-key security rather than block production or node synchronization. However, the disclosure follows several technical disruptions that affected the network in prior years.

Zilliqa announced a permanent fix in September 2024 after a bug halted block production. The network later experienced another outage in January 2025 linked to node synchronization problems before restoring full service. Zilliqa has not connected those incidents to the Ledger app flaw.

The current issue also sits outside Ledger hardware itself. Zilliqa described the vulnerability as a defect in its own Ledger application's native signing code. The corrected build restores full-width nonce generation and should prevent new weak signatures once released.

For affected users, Zilliqa said the main risk remains old transaction history. Public signatures cannot be removed from the blockchain. The project said users who signed about five or more native transactions with a Ledger device should consider their keys compromised and wait for recovery instructions. The network has not announced a date for restoring native transactions. The broader market should watch for the full recovery procedure, any additional exchange actions, and clarity on whether the earlier cold-wallet theft is linked to the same nonce-generation flaw.