Flow scraps blockchain 'rollback' plan after community backlash over decentralization

The layer-1 network reversed course after ecosystem partners warned that rewriting chain history would undermine decentralization and create operational risks following a $3.9 million exploit.

Updated Dec 29, 2025, 7:03 p.m. Published Dec 29, 2025, 7:03 p.m.

The layer-1 network, Flow, scrapped plans to roll back its blockchain following a $3.9 million exploit, reversing course after pushback from ecosystem partners who warned that rewriting chain history would undermine decentralization and create operational risks.

Instead, the network released a statement on Dec. 29 saying it will restart from the last sealed block before transactions were halted on Dec. 27, preserving all legitimate transaction history, according to a recovery plan shared with partners. The revised approach avoids a chain reorganization and instead targets fraudulent assets through account restrictions and token destruction.

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The exploit and initial rollback proposal weighed heavily on the FLOW token, which is down roughly 42% since the incident, CoinGecko data shows.

What happened

During the weekend, Flow confirmed the attack on X, stating that it exploited a vulnerability in its execution layer but did not compromise existing user balances, noting that all legitimate deposits remain intact.

To claw back the funds and reverse the exploit, Flow initially suggested the rollback proposal via X on Dec. 27. Under the rollback recovery framework, accounts that received fraudulent tokens will be temporarily restricted while those assets are withdrawn and burned, and affected decentralized exchange pools will be rebalanced using foundation-held tokens.

Rolling back transactions on a blockchain has been debated previously by the community as a potential way to revert a network to a state prior to a specific event, in this case, the attack. The rollback would effectively erase the malicious transactions and restore lost funds. While the idea is to help a hacked network, this raises questions about the fundamentals of cryptographic networks: decentralization. No centralized entity can alter the blockchain network, ensuring that it remains immutable and free from manipulation. However, if a rollback occurs, it effectively means that a centralized entity will be able to alter how the network operates.

The Flow episode, unsurprisingly, renewed this debate over how decentralized the network is during crisis situations, as foundations and validators weigh intervention against immutability. In the case of Flow, sharp criticism came from developers and infrastructure providers, who cautioned that it could force days of reconciliation work for bridges and exchanges and introduce replay risks.