ZAI issued an apology for a repository indexing tool within ZCode that transferred private workspace files to Alibaba Cloud OSS without user consent. The company identified the cause as a "Repo Wiki" function that was enabled by default during the initial launch, allowing the software to capture and upload user .git histories. ZAI confirmed the problem is now fixed and issued a one-time weekly quota reset for all users on September 18.

The developer will open source the ZCode codebase and enlist third-party reviewers to audit system operations to rebuild trust. Forensic analysis by users had previously alleged that the tool packed entire workspaces and .git logs, encrypting them with a server-side key before uploading the data to Aliyun without disclosure in the product's privacy policy.