Cardano Chain Split Triggers 16% ADA Plunge - But Recovery Already Underway

Cardano's network division sends ADA tumbling as validators scramble to maintain consensus.

The Technical Breakdown

Network fragmentation forced ADA down 16% before buyers stepped in. The chain split created temporary chaos across decentralized applications and staking operations.

Market Reaction & Recovery Patterns

Traders initially panicked—because nothing says 'decentralized future' like centralized exchange outages during volatility. Yet the 16% dip proved shallow as institutional flows absorbed the selling pressure.

Developers confirmed network stabilization protocols activated automatically, preventing what could have been a cascade failure. Validator nodes synchronized within hours, proving the chain's resilience under stress.

Another day in crypto—where a 16% drop counts as a 'healthy correction' and traditional finance folks still think bonds are exciting.

TLDR

• Cardano network experienced a chain split on November 21 when a malformed transaction exploited a bug in node software dating back to 2022
• The network did not go down completely, as block production continued on both chains during the incident
• Emergency patches were deployed within three hours, and the network converged through natural consensus by November 22
• A developer claimed responsibility and apologized, saying they relied on AI instructions and didn’t properly test on testnet first
• ADA price dropped as much as 16% following the incident before recovering slightly to around $0.41

Cardano experienced its first major chain split in eight years on November 21. The incident caused ADA to drop as much as 16% before the price recovered slightly to trade around $0.41.

The chain split occurred at approximately 08:00 UTC when a malformed delegation transaction exploited a bug in node software. The bug dated back to 2022 and created incompatible ledger states across the network.

The transaction bypassed validation checks on newer node versions while being rejected by older infrastructure. This created two competing chains on the $14 billion blockchain.

Block production continued on both chains throughout the incident. However, major exchanges paused ADA operations as they monitored which chain WOULD achieve consensus dominance.

Coinbase suspended deposits and withdrawals for approximately 14 hours, from 12:15 UTC on November 21 through 02:10 UTC on November 22. Other exchanges including Upbit and Kraken implemented shorter pauses while validating ledger integrity.

The Cardano development team deployed emergency patches within three hours of detecting the issue. The network converged through natural consensus by November 22.

Developer Claims Responsibility

An X user named “Homer J” publicly confessed to causing the chain split within hours of the incident. The developer characterized their actions as a “careless” testing accident.

“It started off as a ‘let’s see if I can reproduce the bad transaction’ personal challenge and then I was dumb enough to rely on AI’s instructions,” Homer J wrote. The developer apologized for not properly testing on testnet first.

Cardano founder Charles Hoskinson disputed this characterization. He called the developer’s actions a “premeditated attack” in an X post.

“It was absolutely personal and now he’s trying to walk it back because he knows the FBI is already involved,” Hoskinson wrote. A fact sheet circulated by Intersect and Hoskinson claims that relevant authorities and law enforcement are being notified.

Make sure to share it when the FUD comes rolling in pic.twitter.com/dt3WSVgYvO

— Charles Hoskinson (@IOHK_Charles) November 23, 2025

Network Response and Recovery

Hoskinson shared an official “Myths vs Facts” breakdown addressing speculation about the incident. He confirmed that the mainnet never shut down and that the Core protocol was never compromised.

The cardano ecosystem teams created a joint incident squad shortly after the slowdown began. They organized a fixed node update that enabled the healthy chain to overweigh invalid nodes through regular Ouroboros consensus.

The update was implemented by independent stake pool operators without centralized intervention. This supports assertions about Cardano’s decentralized nature.

Intersect confirmed that a full retrospective will follow the incident. A thorough examination and report will be released to prevent similar occurrences in the future.

One IOG employee publicly announced their resignation following Hoskinson’s decision to involve federal investigators. The employee expressed concerns that future development mistakes could lead to legal consequences.

ADA currently trades at approximately $0.41 according to market data.