diff --git a/core/Cargo.lock b/core/Cargo.lock
index 5d0d5406..2c7ee95b 100644
--- a/core/Cargo.lock
+++ b/core/Cargo.lock
@@ -171,7 +171,6 @@ dependencies = [
  "tracing",
  "tracing-subscriber",
  "uuid",
- "zbase32",
  "zeroize",
  "zip",
 ]
@@ -6819,12 +6818,6 @@ dependencies = [
  "synstructure",
 ]
 
-[[package]]
-name = "zbase32"
-version = "0.1.2"
-source = "registry+https://github.com/rust-lang/crates.io-index"
-checksum = "0f9079049688da5871a7558ddacb7f04958862c703e68258594cb7a862b5e33f"
-
 [[package]]
 name = "zerocopy"
 version = "0.8.33"
diff --git a/core/archipelago/Cargo.toml b/core/archipelago/Cargo.toml
index e65b76d8..549d1eb7 100644
--- a/core/archipelago/Cargo.toml
+++ b/core/archipelago/Cargo.toml
@@ -109,8 +109,10 @@ data-encoding = "2.6"
 zeroize = { version = "1.8.2", features = ["derive"] }
 
 # Mainline DHT (did:dht — BitTorrent DHT for decentralized identity)
+# z-base-32 is implemented in-tree at src/network/zbase32.rs: the `zbase32`
+# crate is LGPL-3.0+, the only hard copyleft dep in the graph and a blocker for
+# the MIT release (docs/LICENSE-COMPLIANCE-AUDIT.md §2).
 mainline = "2"
-zbase32 = "0.1"
 bytes = "1"
 
 # Mesh networking (Meshcore serial protocol over USB LoRa radios)
diff --git a/core/archipelago/src/network/did_dht.rs b/core/archipelago/src/network/did_dht.rs
index 5eebf1f0..54b5a3dc 100644
--- a/core/archipelago/src/network/did_dht.rs
+++ b/core/archipelago/src/network/did_dht.rs
@@ -5,6 +5,7 @@
 //!
 //! The did:dht identifier is the z-base-32 encoding of the Ed25519 public key.
 
+use crate::network::zbase32;
 use anyhow::{Context, Result};
 use ed25519_dalek::{SigningKey, VerifyingKey};
 use std::collections::HashMap;
@@ -41,13 +42,21 @@ pub fn did_from_pubkey(pubkey: &VerifyingKey) -> String {
     format!("did:dht:{}", encoded)
 }
 
+/// Round-trip guard: a `did:dht` identifier IS the z-base-32 encoding of the
+/// key, so a change in that encoding silently rotates every node's DID and
+/// orphans its published DHT records. Pinned here as well as in the encoder's
+/// own tests because this is the call site that gives the string its meaning.
+#[cfg(test)]
+const DID_FOR_TEST_MNEMONIC_NODE_KEY: &str =
+    "did:dht:1o96jdeaigue33hrds3ph6shicehgssx6q6c88yo638curyx7i4y";
+
 /// Extract the Ed25519 public key bytes from a did:dht identifier.
 pub fn pubkey_from_did(did: &str) -> Result<[u8; 32]> {
     let id = did
         .strip_prefix("did:dht:")
         .ok_or_else(|| anyhow::anyhow!("Not a did:dht identifier: {}", did))?;
-    let bytes = zbase32::decode_full_bytes_str(id)
-        .map_err(|e| anyhow::anyhow!("Invalid z-base-32: {:?}", e))?;
+    let bytes =
+        zbase32::decode_full_bytes_str(id).map_err(|e| anyhow::anyhow!("Invalid z-base-32: {e}"))?;
     if bytes.len() != 32 {
         anyhow::bail!("Expected 32-byte pubkey, got {} bytes", bytes.len());
     }
@@ -188,6 +197,30 @@ mod tests {
         assert!(pubkey_from_did("did:key:z123").is_err());
     }
 
+    /// The identifier for a known key must not move. Guards the LGPL `zbase32`
+    /// → in-tree encoder swap, and any future change to it.
+    #[test]
+    fn did_for_a_known_key_is_stable() {
+        let key_bytes: [u8; 32] =
+            hex::decode("943fe48d18a9a68ce7841db2de7adcab11c35acff3bcc39c10f64ec9900fed74")
+                .unwrap()
+                .try_into()
+                .unwrap();
+        let pubkey = VerifyingKey::from_bytes(&key_bytes).unwrap();
+
+        assert_eq!(did_from_pubkey(&pubkey), DID_FOR_TEST_MNEMONIC_NODE_KEY);
+        assert_eq!(
+            pubkey_from_did(DID_FOR_TEST_MNEMONIC_NODE_KEY).unwrap(),
+            key_bytes
+        );
+    }
+
+    #[test]
+    fn rejects_a_did_whose_body_is_not_zbase32() {
+        // `l` and `v` are not in the z-base-32 alphabet.
+        assert!(pubkey_from_did("did:dht:lllvvv").is_err());
+    }
+
     #[test]
     fn test_build_did_document() {
         let key = SigningKey::generate(&mut rand::rngs::OsRng);
diff --git a/core/archipelago/src/network/mod.rs b/core/archipelago/src/network/mod.rs
index e5d0c2cb..2c68f146 100644
--- a/core/archipelago/src/network/mod.rs
+++ b/core/archipelago/src/network/mod.rs
@@ -3,3 +3,4 @@ pub mod dns;
 pub mod dwn_store;
 pub mod dwn_sync;
 pub mod router;
+pub mod zbase32;
diff --git a/core/archipelago/src/network/zbase32.rs b/core/archipelago/src/network/zbase32.rs
new file mode 100644
index 00000000..332b978d
--- /dev/null
+++ b/core/archipelago/src/network/zbase32.rs
@@ -0,0 +1,227 @@
+//! z-base-32 encoding, as used by `did:dht` identifiers.
+//!
+//! [z-base-32](https://philzimmermann.com/docs/human-oriented-base-32-encoding.txt)
+//! is Zooko's human-oriented base-32 alphabet: same 5-bits-per-character idea as
+//! RFC 4648 base32, but with the characters permuted so the ones people confuse
+//! (`0`/`O`, `1`/`l`/`I`, `2`/`Z`, `v`/`u`) are either absent or arranged to
+//! minimise transcription errors, and with no `=` padding.
+//!
+//! # Why this exists rather than a crate
+//!
+//! This replaces the `zbase32` crate, which is **LGPL-3.0+** — the only hard
+//! copyleft dependency in the Rust graph and a blocker for the MIT release
+//! (`docs/LICENSE-COMPLIANCE-AUDIT.md` §2). Statically linking LGPL code into a
+//! Rust binary obliges us to ship relinkable objects, which is impractical for
+//! a node image. The encoding itself is an alphabet substitution over a bit
+//! stream, so an original implementation is a few dozen lines and adds no
+//! dependency at all.
+//!
+//! # Compatibility
+//!
+//! Output is **byte-identical** to `zbase32 0.1.2`'s `encode_full_bytes` /
+//! `decode_full_bytes_str`, which is what the previous implementation called.
+//! That matters because a `did:dht` identifier *is* this encoding of an Ed25519
+//! public key: a different output would silently change every node's DID and
+//! break already-published DHT records. The tests below pin the crate's own
+//! documented vectors, the canonical vectors from Zimmermann's spec, and
+//! several 32-byte keys.
+//!
+//! # Bit layout
+//!
+//! Bits are taken most-significant-first from the byte stream and grouped into
+//! 5-bit chunks. When the bit count is not a multiple of 5 the final chunk is
+//! padded on the right (low side) with zero bits. A 32-byte key is 256 bits →
+//! 52 characters (260 bits), so the last character carries 4 padding bits.
+
+/// The z-base-32 alphabet. Index = 5-bit value.
+const ALPHABET: &[u8; 32] = b"ybndrfg8ejkmcpqxot1uwisza345h769";
+
+/// Reverse of [`ALPHABET`]: ASCII byte → 5-bit value, `None` if not a digit.
+/// Built at compile time so decoding is a table lookup and stays in sync with
+/// the alphabet by construction.
+const DECODE_TABLE: [Option<u8>; 256] = {
+    let mut table = [None; 256];
+    let mut i = 0;
+    while i < 32 {
+        table[ALPHABET[i] as usize] = Some(i as u8);
+        i += 1;
+    }
+    table
+};
+
+/// Encode every bit of `data` as z-base-32.
+///
+/// Equivalent to the `zbase32` crate's `encode_full_bytes`.
+pub fn encode_full_bytes(data: &[u8]) -> String {
+    let bits = data.len() * 8;
+    // ceil(bits / 5)
+    let out_len = bits.div_ceil(5);
+    let mut out = String::with_capacity(out_len);
+
+    // `acc` holds the not-yet-emitted low `acc_bits` bits, MSB-first.
+    let mut acc: u32 = 0;
+    let mut acc_bits: u32 = 0;
+    for &byte in data {
+        acc = (acc << 8) | u32::from(byte);
+        acc_bits += 8;
+        while acc_bits >= 5 {
+            acc_bits -= 5;
+            let idx = (acc >> acc_bits) & 0x1f;
+            out.push(ALPHABET[idx as usize] as char);
+        }
+    }
+    // Trailing bits: left-align them in a 5-bit group (pad right with zeros).
+    if acc_bits > 0 {
+        let idx = (acc << (5 - acc_bits)) & 0x1f;
+        out.push(ALPHABET[idx as usize] as char);
+    }
+
+    debug_assert_eq!(out.len(), out_len);
+    out
+}
+
+/// Decode a z-base-32 string, keeping only whole bytes.
+///
+/// Equivalent to the `zbase32` crate's `decode_full_bytes_str`: the input
+/// carries `len * 5` bits, and everything below the next lower byte boundary is
+/// discarded. So 52 characters (260 bits) yield 32 bytes and the final 4 bits
+/// are ignored — which is exactly why a 32-byte key round-trips.
+///
+/// Returns `Err` with the offending character if the input is not z-base-32.
+pub fn decode_full_bytes_str(s: &str) -> Result<Vec<u8>, String> {
+    let total_bits = s.len() * 5;
+    let keep_bits = total_bits / 8 * 8;
+    let mut out = Vec::with_capacity(keep_bits / 8);
+
+    let mut acc: u32 = 0;
+    let mut acc_bits: u32 = 0;
+    let mut emitted_bits = 0usize;
+    for ch in s.chars() {
+        // Non-ASCII can't be a digit; `as usize` on a multi-byte char would
+        // index the table wrongly, so reject before the lookup.
+        let value = u8::try_from(ch as u32)
+            .ok()
+            .and_then(|b| DECODE_TABLE[b as usize])
+            .ok_or_else(|| format!("not a z-base-32 digit: {ch:?}"))?;
+        acc = (acc << 5) | u32::from(value);
+        acc_bits += 5;
+        while acc_bits >= 8 && emitted_bits < keep_bits {
+            acc_bits -= 8;
+            out.push(((acc >> acc_bits) & 0xff) as u8);
+            emitted_bits += 8;
+        }
+    }
+
+    debug_assert_eq!(out.len(), keep_bits / 8);
+    Ok(out)
+}
+
+#[cfg(test)]
+mod tests {
+    use super::*;
+
+    /// The three doc-test vectors from `zbase32 0.1.2` itself. If these hold,
+    /// this module is a drop-in for the calls the crate used to serve.
+    #[test]
+    fn matches_the_replaced_crates_own_doctests() {
+        assert_eq!(
+            encode_full_bytes("Just an arbitrary sentence.".as_bytes()),
+            "jj4zg7bycfznyam1cjwzehubqjh1yh5fp34gk5udcwzy"
+        );
+        assert_eq!(decode_full_bytes_str("qb1ze3m1").unwrap(), b"peter");
+        // `encode(b"testdata", 64)` — 64 bits is exactly 8 whole bytes, so
+        // encode_full_bytes agrees with the crate's bit-precision form here.
+        assert_eq!(encode_full_bytes(b"testdata"), "qt1zg7drcf4gn");
+    }
+
+    /// Canonical vectors from Zimmermann's z-base-32 spec (the whole-byte
+    /// subset — the spec's sub-byte cases exercise an API we deliberately
+    /// don't expose).
+    #[test]
+    fn matches_the_spec_vectors() {
+        assert_eq!(encode_full_bytes(&[0xf0, 0xbf, 0xc7]), "6n9hq");
+        assert_eq!(encode_full_bytes(&[0xd4, 0x7a, 0x04]), "4t7ye");
+    }
+
+    /// A `did:dht` identifier is this encoding of a 32-byte Ed25519 key, so
+    /// these pin the exact strings that must not drift. Computed independently
+    /// and cross-checked against the spec vectors above.
+    #[test]
+    fn known_answers_for_32_byte_keys() {
+        let seq: Vec<u8> = (0u8..32).collect();
+        assert_eq!(
+            encode_full_bytes(&seq),
+            "yyyoryarywdyqnyjbefoadeqbhebnrounoktcfaadrpbs8y7daxo"
+        );
+        assert_eq!(
+            encode_full_bytes(&[0xff; 32]),
+            "999999999999999999999999999999999999999999999999999o"
+        );
+        assert_eq!(
+            encode_full_bytes(&[0x00; 32]),
+            "yyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyy"
+        );
+        // The node Ed25519 public key derived from seed.rs's TEST_MNEMONIC.
+        let node_key =
+            hex::decode("943fe48d18a9a68ce7841db2de7adcab11c35acff3bcc39c10f64ec9900fed74")
+                .unwrap();
+        assert_eq!(
+            encode_full_bytes(&node_key),
+            "1o96jdeaigue33hrds3ph6shicehgssx6q6c88yo638curyx7i4y"
+        );
+    }
+
+    #[test]
+    fn a_32_byte_key_is_52_chars_and_round_trips() {
+        for seed in 0u8..64 {
+            let key: Vec<u8> = (0u8..32).map(|i| i.wrapping_mul(7).wrapping_add(seed)).collect();
+            let encoded = encode_full_bytes(&key);
+            assert_eq!(encoded.len(), 52, "256 bits must encode to 52 characters");
+            assert_eq!(decode_full_bytes_str(&encoded).unwrap(), key);
+        }
+    }
+
+    #[test]
+    fn round_trips_every_length_up_to_a_block() {
+        for len in 0..40usize {
+            let data: Vec<u8> = (0..len).map(|i| (i as u8).wrapping_mul(31) ^ 0x5a).collect();
+            let encoded = encode_full_bytes(&data);
+            // decode_full_bytes only recovers whole bytes, and encoding N bytes
+            // produces ceil(8N/5) chars which always carry at least 8N bits.
+            assert_eq!(decode_full_bytes_str(&encoded).unwrap(), data, "len {len}");
+        }
+    }
+
+    #[test]
+    fn empty_input() {
+        assert_eq!(encode_full_bytes(&[]), "");
+        assert_eq!(decode_full_bytes_str("").unwrap(), Vec::<u8>::new());
+    }
+
+    #[test]
+    fn rejects_non_alphabet_characters() {
+        // `l`, `v`, `2`, `0` are deliberately absent from the z-base-32
+        // alphabet — they're the characters it exists to avoid.
+        for bad in ["l", "v", "2", "0", "A", "yyy!", "yyyé"] {
+            assert!(
+                decode_full_bytes_str(bad).is_err(),
+                "{bad:?} must not decode"
+            );
+        }
+    }
+
+    /// The alphabet must stay a permutation of 32 distinct ASCII characters, or
+    /// the compile-time decode table silently loses entries.
+    #[test]
+    fn alphabet_is_32_distinct_ascii_characters() {
+        let mut seen = std::collections::HashSet::new();
+        for &c in ALPHABET.iter() {
+            assert!(c.is_ascii(), "non-ASCII in alphabet");
+            assert!(seen.insert(c), "duplicate character in alphabet: {c}");
+        }
+        assert_eq!(seen.len(), 32);
+        for (i, &c) in ALPHABET.iter().enumerate() {
+            assert_eq!(DECODE_TABLE[c as usize], Some(i as u8));
+        }
+    }
+}
diff --git a/docs/LICENSE-COMPLIANCE-AUDIT.md b/docs/LICENSE-COMPLIANCE-AUDIT.md
index e2457ef6..fabac229 100644
--- a/docs/LICENSE-COMPLIANCE-AUDIT.md
+++ b/docs/LICENSE-COMPLIANCE-AUDIT.md
@@ -7,7 +7,8 @@ Audit date: 2026-07-22. Scope: entire repo (core Rust workspace, neode-ui, apps/
 > **Updated 2026-08-08.** §1 (no license) and §3 (non-redistributable committed
 > files) are now **closed** — root `LICENSE` (MIT) + `NOTICE` are in the tree, and
 > the proprietary fonts and unused packages have actually been deleted. **§2
-> (`zbase32`, LGPL-3.0+) is still open** and is the last hard blocker.
+> (`zbase32`, LGPL-3.0+) is now closed too** — replaced by an in-tree
+> implementation. No copyleft dependency remains in the Rust graph.
 
 ---
 
@@ -44,7 +45,7 @@ Audit date: 2026-07-22. Scope: entire repo (core Rust workspace, neode-ui, apps/
 - License inventories generated: `core/THIRD-PARTY-LICENSES.md` (649 crates) and `neode-ui/THIRD-PARTY-LICENSES.md` (runtime deps + fonts + vendored).
 
 **REMAINING (code changes, awaiting review — see sections below for detail):**
-1. Replace `zbase32` (LGPL-3.0+) with `z32` or original impl — §2.
+1. ~~Replace `zbase32` (LGPL-3.0+) with `z32` or original impl~~ — **DONE 2026-08-08**, original impl (§2).
 2. Swap `redis:7.4.8` → Valkey in `scripts/image-versions.sh` and deploys — §3.
 3. Delete dead StartOS-derived crates `core/{js-engine,container-init,models,helpers}` — §4.
 4. Attribution build integration: cargo-about in CI → ship full license texts in ISO; vite/rollup license plugin (or UI licenses page) for the web bundle; Android OSS-licenses screen — §5.
@@ -52,7 +53,7 @@ Audit date: 2026-07-22. Scope: entire repo (core Rust workspace, neode-ui, apps/
 6. ~~Before repo goes public: purge deleted fonts/APKs from git history (`git filter-repo`)~~ — **superseded**: the launch plan is a fresh-history publish, so there is no history to rewrite. What still applies is verifying the game-icons author credit, and actually deleting the files (see the correction above — they were never removed).
 
 **Re-verified 2026-08-08:**
-- `zbase32 0.1.2` (LGPL-3.0+) is **still a direct dependency** (`core/archipelago/Cargo.toml:113`), still used at `network/did_dht.rs:40,49`. Item 1 remains open and is the only hard copyleft blocker.
+- ~~`zbase32 0.1.2` (LGPL-3.0+) is still a direct dependency.~~ **Removed 2026-08-08** — see §2.
 - `LICENSE` (MIT) and `NOTICE` are present ✅. `core/THIRD-PARTY-LICENSES.md` and `neode-ui/THIRD-PARTY-LICENSES.md` are present ✅.
 - The four StartOS-derived crates in item 3 (`core/{js-engine,container-init,models,helpers}`) **still exist** — note KEY-05 legitimately cites `core/models`, so that one needs a look before deletion rather than a blind `rm`.
 
@@ -70,9 +71,22 @@ There is no `LICENSE`/`COPYING` file anywhere in the repo. No crate in `core/` d
 - [ ] Add `license = "MIT"` to all five workspace member `Cargo.toml`s (archipelago, container, openwrt, performance, security) and `Android/rust/archy-fips-core` (declares MIT but ships no license file — add one).
 - [ ] Add `"license": "MIT"` to `neode-ui/package.json` and `apps/{morphos-server,router,did-wallet}/package.json`.
 
-## 2. BLOCKER — copyleft dependency that must be replaced
+## 2. BLOCKER — copyleft dependency that must be replaced  ✅ CLOSED 2026-08-08
 
-- [ ] **`zbase32 0.1.2` — LGPL-3.0+** — the only hard copyleft blocker in all 649 resolved Rust crates. Direct dep of `archipelago`, used in `core/archipelago/src/network/did_dht.rs` for did:dht z-base-32 encoding. LGPL statically linked into a Rust binary requires shipping relinkable objects/source — impractical. **Replace with the MIT `z32` crate** or a ~30-line original alphabet-substitution implementation.
+- [x] **`zbase32 0.1.2` — LGPL-3.0+** — was the only hard copyleft blocker in all 649 resolved Rust crates. Direct dep of `archipelago`, used in `core/archipelago/src/network/did_dht.rs` for did:dht z-base-32 encoding. LGPL statically linked into a Rust binary requires shipping relinkable objects/source — impractical.
+
+  **DONE 2026-08-08.** Replaced with an original in-tree implementation at
+  `core/archipelago/src/network/zbase32.rs` (~60 lines incl. docs) rather than
+  the `z32` crate — the encoding is an alphabet substitution over a bit stream,
+  so this removes the blocker without adding any dependency or new supply-chain
+  surface. Dropped from `Cargo.toml` and `Cargo.lock`.
+
+  Byte-compatibility was the hard requirement: a `did:dht` identifier *is* this
+  encoding of an Ed25519 public key, so any drift would silently rotate every
+  node's DID and orphan its published DHT records. The replacement is pinned
+  against the removed crate's own three doc-test vectors, the canonical vectors
+  from Zimmermann's z-base-32 spec, and four known 32-byte keys — plus a
+  `did_for_a_known_key_is_stable` test at the `did_dht.rs` call site.
 
 No GPL, AGPL, SSPL, or unlicensed crates exist anywhere else in the Rust graph. (`r-efi` and `self_cell` list LGPL/GPL only as options in OR-expressions — elect MIT/Apache, no action.)
 
@@ -132,7 +146,7 @@ The ISO redistributes a full Debian (trixie) system plus ~29 container image tar
 
 ## Quick reference: what's already clean
 
-- All 649 Rust crates except `zbase32`: permissive or dual-licensed.
+- All Rust crates: permissive or dual-licensed (`zbase32` was the sole exception and is gone as of 2026-08-08).
 - All 833 npm packages in neode-ui: no GPL/AGPL anywhere; only dev-tool LGPL (sharp's libvips, never distributed).
 - Android Gradle deps: 100 % Apache-2.0, all pinned, no Play Services/telemetry.
 - FIPS mesh: MIT (© 2026 Johnathan Corgan) — keep notice.