Z.ai apologizes for ZCode's workspace uploads and open sources the project

Chinese AI company Z.ai has apologized after developers found that its code-generation tool ZCode was quietly packaging entire user workspaces and uploading them to cloud storage. The company says the data was never used to train its models, has removed the feature responsible and published the project's source code on GitHub.

What ZCode was sending

According to researcher Ferstar, who first documented the behavior, the uploads were triggered by ZCode's Repository Index function once its Repo Wiki feature had generated documentation pages in the cloud. The harness bundled whole workspaces, complete project histories included, into git-encrypted archives and shipped them to Alibaba Cloud.

The key needed to decrypt those archives was held only on servers under Z.ai's control. Users could neither read nor delete the files ZCode had uploaded, and Ferstar said the tool offered no setting to switch the behavior off and no mention of it in the product's privacy policy.

Apology and outside audits

ZCode published a statement on Monday apologizing for the "security issues" and confirming that the uploaded data was never used for model training. "Going forward, we will establish an ongoing product security vulnerability reporting and response process," the company said, promising rewards based on the severity of issues developers report.

The team said it had asked the China Academy of Information and Communications Technology (CAICT) and Beijing security firm NSFOCUS to assess the product after the changes. Both reviews concluded that all previously uploaded data has now been deleted, according to Z.ai, and the Repo Wiki feature has been removed.

Open source, with caveats

ZCode also open sourced the whole project on GitHub, saying this places the code "under community scrutiny and making ZCode more open and transparent." A full security assessment report is due to follow soon.

Ferstar confirmed the released code no longer contains the Repo Wiki implementation, but criticized the company for wiping commit records and the pre-patch upload code, which makes independent verification of the original behavior harder.

A familiar pattern

The episode echoes July's disclosures about xAI's Grok build, which was found sending entire repositories to the cloud and drew a promise from Elon Musk to purge the data. Z.ai, formerly known as Zhipu, is one of China's largest AI developers: it spun out of Tsinghua University's Knowledge Engineering Group in 2019 and became the first AI-era company to list on the Hong Kong Stock Exchange. Last month it claimed its GLM-5.3 model matched the best Western systems at finding security vulnerabilities.