diff --git a/packages/wallet-service/src/nodeConfig.ts b/packages/wallet-service/src/nodeConfig.ts
index 876288f7..eb21cf30 100644
--- a/packages/wallet-service/src/nodeConfig.ts
+++ b/packages/wallet-service/src/nodeConfig.ts
@@ -41,7 +41,11 @@ export function convertApiVersionData(data: FullNodeApiVersionResponse): FullNod
   return {
     version: data.version,
     network: data.network,
-    nanoContractsEnabled: data.nano_contracts_enabled ?? false,
+    // NOTE: Due to a bug in older fullnode versions, nano_contracts_enabled may return
+    // string values ('disabled', 'enabled', 'feature_activation') instead of boolean.
+    // This will be fixed in future fullnode versions to return boolean only.
+    // Until then, we need to handle both string and boolean values.
+    nanoContractsEnabled: data.nano_contracts_enabled === true || data.nano_contracts_enabled === 'enabled' || data.nano_contracts_enabled === 'feature_activation',
     minWeight: data.min_weight,
     minTxWeight: data.min_tx_weight,
     minTxWeightCoefficient: data.min_tx_weight_coefficient,
diff --git a/packages/wallet-service/src/schemas.ts b/packages/wallet-service/src/schemas.ts
index 8bca7225..d35f518f 100644
--- a/packages/wallet-service/src/schemas.ts
+++ b/packages/wallet-service/src/schemas.ts
@@ -13,7 +13,13 @@ export const Sha256Schema = Joi.string().hex().length(64);
 export const FullnodeVersionSchema = Joi.object<FullNodeApiVersionResponse>({
   version: Joi.string().min(1).required(),
   network: Joi.string().min(1).required(),
-  nano_contracts_enabled: Joi.boolean().required(),
+  // NOTE: Due to a bug in older fullnode versions, this field may be a string
+  // ('disabled', 'enabled', 'feature_activation') instead of boolean.
+  // Future fullnode versions will return boolean only.
+  nano_contracts_enabled: Joi.alternatives().try(
+    Joi.boolean(),
+    Joi.string().valid('disabled', 'enabled', 'feature_activation')
+  ).required(),
   min_weight: Joi.number().integer().positive().allow(0).required(),
   min_tx_weight: Joi.number().integer().positive().allow(0).required(),
   min_tx_weight_coefficient: Joi.number().positive().allow(0).required(),
diff --git a/packages/wallet-service/src/types.ts b/packages/wallet-service/src/types.ts
index 909a9328..1388028d 100644
--- a/packages/wallet-service/src/types.ts
+++ b/packages/wallet-service/src/types.ts
@@ -75,12 +75,12 @@ export interface EnvironmentConfig {
   firebaseTokenUri: string;
   firebaseAuthProviderX509CertUrl: string;
   firebaseClientX509CertUrl: string;
-  firebasePrivateKey: string|null;
+  firebasePrivateKey: string | null;
   maxLoadWalletRetries: number;
   logLevel: string;
   createNftMaxRetries: number;
   warnMaxReorgSize: number;
-};
+}
 
 /**
  * Fullnode converted version data.
@@ -108,7 +108,10 @@ export interface FullNodeVersionData {
 export interface FullNodeApiVersionResponse {
   version: string;
   network: string;
-  nano_contracts_enabled?: boolean;
+  // NOTE: Due to a bug in older fullnode versions, this field may be a string
+  // ('disabled', 'enabled', 'feature_activation') instead of boolean.
+  // Future fullnode versions will return boolean only.
+  nano_contracts_enabled?: boolean | 'disabled' | 'enabled' | 'feature_activation';
   min_weight: number;
   min_tx_weight: number;
   min_tx_weight_coefficient: number; // float
@@ -121,7 +124,7 @@ export interface FullNodeApiVersionResponse {
   genesis_block_hash?: string,
   genesis_tx1_hash?: string,
   genesis_tx2_hash?: string,
-  native_token?: { name: string, symbol: string};
+  native_token?: { name: string, symbol: string };
 }
 
 export interface TxProposal {
diff --git a/packages/wallet-service/tests/nodeConfig.test.ts b/packages/wallet-service/tests/nodeConfig.test.ts
index a6c8cef8..064c3d8c 100644
--- a/packages/wallet-service/tests/nodeConfig.test.ts
+++ b/packages/wallet-service/tests/nodeConfig.test.ts
@@ -111,6 +111,27 @@ test('convertApiVersionData handles nano_contracts_enabled correctly', async ()
   };
   expect(convertApiVersionData(versionWithNanoTrue).nanoContractsEnabled).toBe(true);
 
+  // Test with nano_contracts_enabled = 'disabled' (should be false)
+  const versionWithDisabled: FullNodeApiVersionResponse = {
+    ...OLD_VERSION_DATA,
+    nano_contracts_enabled: 'disabled',
+  };
+  expect(convertApiVersionData(versionWithDisabled).nanoContractsEnabled).toBe(false);
+
+  // Test with nano_contracts_enabled = 'enabled' (should be true)
+  const versionWithEnabled: FullNodeApiVersionResponse = {
+    ...OLD_VERSION_DATA,
+    nano_contracts_enabled: 'enabled',
+  };
+  expect(convertApiVersionData(versionWithEnabled).nanoContractsEnabled).toBe(true);
+
+  // Test with nano_contracts_enabled = 'feature_activation' (should be true)
+  const versionWithFeatureActivation: FullNodeApiVersionResponse = {
+    ...OLD_VERSION_DATA,
+    nano_contracts_enabled: 'feature_activation',
+  };
+  expect(convertApiVersionData(versionWithFeatureActivation).nanoContractsEnabled).toBe(true);
+
   // Test with nano_contracts_enabled = undefined (should default to false)
   const versionWithNanoUndefined: FullNodeApiVersionResponse = {
     ...OLD_VERSION_DATA,