Smart Contract Security

Development and Review Processes

Smart contract security begins at the development phase through rigorous internal review protocols. Every code commit undergoes automated analysis using multiple AI-powered security tools that scan for common vulnerabilities, gas optimization issues, and logic errors before code enters the review pipeline. This automated first-pass detection catches low-hanging security issues and code quality problems early in the development cycle.

Beyond automated scanning, all smart contract code is subject to mandatory peer review by independent developers within the Zoth engineering team. This human review layer identifies complex logic vulnerabilities, architectural weaknesses, and integration risks that automated tools may miss. The internal review process requires sign-off from at least one developer other than the original author before code can progress to testing environments.

The protocol maintains extensive test coverage with comprehensive test suites that validate both expected functionality and edge case behavior. Test cases include unit tests for individual contract functions, integration tests for cross-contract interactions, and scenario-based tests that simulate realistic user workflows and potential attack vectors. This testing discipline ensures that contracts behave correctly under both normal and adversarial conditions. External Audits

Prior to mainnet deployment, all smart contracts and backend infrastructure undergo comprehensive security audits conducted by top-tier blockchain security firms. These external audits provide independent validation of contract security, identifying vulnerabilities in access controls, state management, upgrade mechanisms, and economic logic. Audit findings are addressed through iterative remediation cycles, with contracts only deployed after all critical and high-severity issues have been resolved.

Beyond pre-deployment audits, the protocol engages in ongoing penetration testing and stress testing conducted by external security specialists. These exercises simulate realistic attack scenarios, test system behavior under extreme load conditions, and validate that security controls function correctly under stress. Load balancing infrastructure ensures that the platform maintains performance and security even during periods of exceptional transaction volume.

Bug Bounty Program

Zoth operates a continuous bug bounty program that incentivizes security researchers and white-hat hackers to identify and responsibly disclose vulnerabilities. Bounty rewards are paid in USDC, with reward tiers scaling based on vulnerability severity and potential impact. As the protocol matures and total value locked increases, bounty reward amounts will increase proportionally to maintain competitive incentives for top-tier security researchers.

The bug bounty program covers all in-scope contracts, backend APIs, and infrastructure components, providing broad surface area for security research. Responsible disclosure protocols ensure that identified vulnerabilities are patched before public disclosure, protecting users while giving researchers appropriate recognition and compensation.

Real-Time Threat Detection

Zoth has partnered with Hypernative to implement real-time on-chain security monitoring capable of detecting and blocking malicious transactions before they execute. This proactive security layer analyzes transaction patterns, fund flows, and contract interactions in real-time, identifying anomalous behavior that may indicate attacks, exploits, or unauthorized access attempts.

When the monitoring system identifies a potentially malicious transaction, it automatically blocks execution pending manual review by the Zoth security team. Human analysts can then approve legitimate transactions that triggered false positives or confirm and permanently block actual attack attempts. This human-in-the-loop approach balances automated threat prevention with the flexibility to accommodate unusual but legitimate user behavior.

The protocol employs artificial intelligence-based transaction analysis across all vault operations, examining counterparty relationships, fund flow patterns, and historical behavior to identify suspicious activity before it causes harm. This AI-powered monitoring provides defense-in-depth beyond static smart contract security, creating adaptive protection against evolving attack techniques.

Contract Upgradeability and Emergency Controls

All zTOKEN vault contracts and core protocol contracts implement upgradeable proxy patterns with upgrade authority restricted exclusively to the Zoth Foundation. While this centralized upgrade capability enables rapid response to discovered vulnerabilities and deployment of critical security patches, it also introduces governance trust assumptions that users should understand.

Importantly, contract upgrades do not include time-locks, allowing the Foundation to deploy urgent security fixes without delay when vulnerabilities are discovered. However, all non-emergency upgrades follow standard governance processes, with proposed changes subject to community review and ZOTH token holder oversight. This dual-path approach balances the need for rapid emergency response with appropriate governance for routine protocol evolution.

In the event of a critical security incident or detected exploit, the protocol can immediately activate pause functionality across all affected contracts. This emergency circuit breaker halts deposits, withdrawals, and strategy execution, preventing further damage while the security team assesses the situation and implements remediation measures.

If a hack or exploit successfully extracts value, the protocol's response includes immediate contract shutdown and reversion to a blockchain snapshot taken before the malicious activity occurred. This rollback capability, combined with the MPC custody model where fund managers retain direct control over vault assets, minimizes the potential impact of smart contract exploits on underlying capital.