diff --git a/pkg/core/blockchain.go b/pkg/core/blockchain.go
index 1e819d35b..2b4f6d556 100644
--- a/pkg/core/blockchain.go
+++ b/pkg/core/blockchain.go
@@ -306,10 +306,11 @@ func (bc *Blockchain) init() error {
 	if err != nil {
 		bc.log.Info("no storage version found! creating genesis block")
 		ver = dao.Version{
-			StoragePrefix:     storage.STStorage,
-			StateRootInHeader: bc.config.StateRootInHeader,
-			P2PSigExtensions:  bc.config.P2PSigExtensions,
-			Value:             version,
+			StoragePrefix:       storage.STStorage,
+			StateRootInHeader:   bc.config.StateRootInHeader,
+			P2PSigExtensions:    bc.config.P2PSigExtensions,
+			KeepOnlyLatestState: bc.config.KeepOnlyLatestState,
+			Value:               version,
 		}
 		if err = bc.dao.PutVersion(ver); err != nil {
 			return err
@@ -341,6 +342,10 @@ func (bc *Blockchain) init() error {
 		return fmt.Errorf("P2PSigExtensions setting mismatch (old=%t, new=%t",
 			ver.P2PSigExtensions, bc.config.P2PSigExtensions)
 	}
+	if ver.KeepOnlyLatestState != bc.config.KeepOnlyLatestState {
+		return fmt.Errorf("KeepOnlyLatestState setting mismatch: old=%v, new=%v",
+			ver.KeepOnlyLatestState, bc.config.KeepOnlyLatestState)
+	}
 	bc.dao.Version = ver
 	bc.persistent.Version = ver
 
diff --git a/pkg/core/blockchain_test.go b/pkg/core/blockchain_test.go
index 5c2eff93b..a1c20be2a 100644
--- a/pkg/core/blockchain_test.go
+++ b/pkg/core/blockchain_test.go
@@ -1823,7 +1823,7 @@ func TestBlockchain_InitWithIncompleteStateJump(t *testing.T) {
 			binary.LittleEndian.PutUint32(point, uint32(stateSyncPoint))
 			require.NoError(t, bcSpout.dao.Store.Put(storage.SYSStateSyncPoint.Bytes(), point))
 			shouldFail := stage == 0x03 // unknown stage
-			checkNewBlockchainErr(t, boltCfg, bcSpout.dao.Store, shouldFail)
+			checkNewBlockchainErr(t, spountCfg, bcSpout.dao.Store, shouldFail)
 		})
 	}
 }
diff --git a/pkg/core/dao/dao.go b/pkg/core/dao/dao.go
index a82519fb5..5387e4752 100644
--- a/pkg/core/dao/dao.go
+++ b/pkg/core/dao/dao.go
@@ -378,15 +378,17 @@ func (dao *Simple) GetBlock(hash util.Uint256) (*block.Block, error) {
 
 // Version represents current dao version.
 type Version struct {
-	StoragePrefix     storage.KeyPrefix
-	StateRootInHeader bool
-	P2PSigExtensions  bool
-	Value             string
+	StoragePrefix       storage.KeyPrefix
+	StateRootInHeader   bool
+	P2PSigExtensions    bool
+	KeepOnlyLatestState bool
+	Value               string
 }
 
 const (
 	stateRootInHeaderBit = 1 << iota
 	p2pSigExtensionsBit
+	keepOnlyLatestStateBit
 )
 
 // FromBytes decodes v from a byte-slice.
@@ -411,6 +413,7 @@ func (v *Version) FromBytes(data []byte) error {
 	v.StoragePrefix = storage.KeyPrefix(data[i+1])
 	v.StateRootInHeader = data[i+2]&stateRootInHeaderBit != 0
 	v.P2PSigExtensions = data[i+2]&p2pSigExtensionsBit != 0
+	v.KeepOnlyLatestState = data[i+2]&keepOnlyLatestStateBit != 0
 	return nil
 }
 
@@ -423,6 +426,9 @@ func (v *Version) Bytes() []byte {
 	if v.P2PSigExtensions {
 		mask |= p2pSigExtensionsBit
 	}
+	if v.KeepOnlyLatestState {
+		mask |= keepOnlyLatestStateBit
+	}
 	return append([]byte(v.Value), '\x00', byte(v.StoragePrefix), mask)
 }
 
diff --git a/pkg/core/stateroot/module.go b/pkg/core/stateroot/module.go
index e5e7a5439..322e23c8e 100644
--- a/pkg/core/stateroot/module.go
+++ b/pkg/core/stateroot/module.go
@@ -103,22 +103,10 @@ func (s *Module) Init(height uint32, enableRefCount bool) error {
 		s.validatedHeight.Store(binary.LittleEndian.Uint32(data))
 	}
 
-	var gcKey = []byte{byte(storage.DataMPT), prefixGC}
 	if height == 0 {
 		s.mpt = mpt.NewTrie(nil, enableRefCount, s.Store)
-		var val byte
-		if enableRefCount {
-			val = 1
-		}
 		s.currentLocal.Store(util.Uint256{})
-		return s.Store.Put(gcKey, []byte{val})
-	}
-	var hasRefCount bool
-	if v, err := s.Store.Get(gcKey); err == nil {
-		hasRefCount = v[0] != 0
-	}
-	if hasRefCount != enableRefCount {
-		return fmt.Errorf("KeepOnlyLatestState setting mismatch: old=%v, new=%v", hasRefCount, enableRefCount)
+		return nil
 	}
 	r, err := s.getStateRoot(makeStateRootKey(height))
 	if err != nil {
@@ -138,25 +126,15 @@ func (s *Module) CleanStorage() error {
 	if s.localHeight.Load() != 0 {
 		return fmt.Errorf("can't clean MPT data for non-genesis block: expected local stateroot height 0, got %d", s.localHeight.Load())
 	}
-	gcKey := []byte{byte(storage.DataMPT), prefixGC}
-	gcVal, err := s.Store.Get(gcKey)
-	if err != nil {
-		return fmt.Errorf("failed to get GC flag: %w", err)
-	}
-	//
 	b := s.Store.Batch()
 	s.Store.Seek([]byte{byte(storage.DataMPT)}, func(k, _ []byte) {
 		// #1468, but don't need to copy here, because it is done by Store.
 		b.Delete(k)
 	})
-	err = s.Store.PutBatch(b)
+	err := s.Store.PutBatch(b)
 	if err != nil {
 		return fmt.Errorf("failed to remove outdated MPT-reated items: %w", err)
 	}
-	err = s.Store.Put(gcKey, gcVal)
-	if err != nil {
-		return fmt.Errorf("failed to store GC flag: %w", err)
-	}
 	currentLocal := s.currentLocal.Load().(util.Uint256)
 	if !currentLocal.Equals(util.Uint256{}) {
 		err := s.addLocalStateRoot(s.Store, &state.MPTRoot{
diff --git a/pkg/core/stateroot/store.go b/pkg/core/stateroot/store.go
index 9efcf7c5f..ee5a52f78 100644
--- a/pkg/core/stateroot/store.go
+++ b/pkg/core/stateroot/store.go
@@ -17,7 +17,6 @@ var (
 )
 
 const (
-	prefixGC        = 0x01
 	prefixLocal     = 0x02
 	prefixValidated = 0x03
 )