What Flow Network’s ‘isolated recovery’ plan after $3.9 mln hack entails

The Flow blockchain has initiated an ‘isolated recovery’ plan for the chain following last week’s $3.9 million crypto hack.

At the time of this writing, Flow announced that it has reached validator consensus on the proposed software upgrade, and testing is underway.

However, final chain operations will be activated later on after all tests have been completed.

After the tests, the plan will enter the next stage, dubbed “phase 1 deployment.” This stage will ensure the resumption of the chain’s broader operations and restriction of addresses linked to the hack.

Flow abandons initial rollback plan

The latest plan was adopted following opposition from key partners and exchanges to the initial plan to launch a full-chain rollback to the pre-hack status and block the hacked funds.

Flow’s breach was first reported over the weekend, and the hacker swiftly moved the stolen $3.9 million off the network. This added to the growing number of 2025 crypto hacks, which have surpassed $3 billion.

However, the consensus for the Flow chain rollback plan was not fast enough.

The rollback proposal would be ineffective because the hacker moved the funds from the chain into Ethereum and other assets, noted security expert Tay Vano.

As a result, proceeding with the initial proposal would only affect innocent users who were not informed of the planned rollback in time.

In fact, Alex Smirnov, co-founder of deBridge, one of the exchanges that handles the majority of FLOW volumes, stated that they weren’t informed of the rollback plans.

The plan was changed to ‘isolated recovery’ following this feedback and the realization that a rollback plan was too late to affect the hacker.

Flow is a Layer 1 chain led by a Foundation but with independent ecosystem builders. One of its largest ecosystem builders, Dapper Labs, threw its full support to the ‘isolated recovery’ proposal and added,

“The revised approach preserves all legitimate user activity—meaning no rollback is required—and provides a clear path to restoring network operations. Safety remains the priority, but urgency is paramount.”

That being said, the chain’s native token, FLOW, dropped over 40% to $0.1 after the breach.

Final Thoughts

• Flow has launched a recovery plan to preserve legitimate user activity, but restricts hackers’ addresses.
• The native token, FLOW, declined 40% after the breach; whether the recovery plan will reverse the losses remains to be seen.