Hoskinson involves FBI after developer's 'careless' experiment splits Cardano blockchain

Cardano suffered its first major chain split in eight years of operation on Nov. 21 after a deliberately crafted transaction exploited a three-year-old bug in node software, temporarily fragmenting the $14 billion blockchain into two competing chains.

The incident began at approximately 08:00 UTC when a malformed delegation transaction bypassed validation checks on newer node versions while being correctly rejected by older infrastructure, creating incompatible ledger states across the network. The anomaly closely mirrored an issue seen on Cardano’s testnet just a day prior, suggesting the exploit was tested in advance before being unleashed on mainnet, according to an incident report from Cardano ecosystem organization Intersect. 

"It is important to note that the network did not stall," Intersect's report states. "Block production continued on both chains throughout the incident, and at least some identical transactions appeared on both chains."

While the network technically continued, major exchanges responded by pausing ADA operations as they monitored which chain would achieve consensus dominance. Coinbase documented the longest disruption, with deposits and withdrawals suspended from 12:15 UTC on Nov. 21 through 02:10 UTC on Nov. 22 — approximately 14 hours. Upbit, Kraken, and other major venues implemented shorter pauses while validating ledger integrity.

Block explorers froze or displayed conflicting information during the partition. DeFi protocols experienced inconsistent state across the split, with smart contract interactions potentially executing on one chain while related transactions landed on the other. Transaction confirmation times, normally measured in seconds on Cardano, stretched to minutes or failed entirely as the network struggled with the partition.

The split persisted for several hours while Input Output Global (IOG), the Cardano Foundation, Intersect, and EMURGO coordinated an emergency response. The Cardano development team deployed emergency patches within three hours of detecting the issue, with the network converging through natural consensus by Nov. 22.

The price of ADA dropped as much as 16% in the wake of the incident before rebounding slightly, currently trading at about $0.41, according to The Block's Cardano Price page. 

Developer apologizes as Hoskinson alerts FBI

Within hours of the incident, X user "Homer J" publicly confessed to causing the chain split, characterizing their actions as a "careless" testing accident and apologizing to the Cardano community.

"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 on how to block all traffic in/out of my Linux server without properly testing it on testnet first," Homer J wrote on X. "I'm ashamed of my carelessness and take full responsibility for it."

Despite Homer J's apology, Cardano founder and IOG co-founder Charles Hoskinson 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" about the developer's actions. The Block could not immediately reach Hoskinson or IOG for further comment. 

IOG employee resigns following Hoskinson's comment

Hoskinson's decision to involve federal investigators led one IOG employee to publicly declare their resignation from the Cardano development firm.

X user "effectfully," identified as a Plutus language developer at IOG named Roman in a 2024 podcast from the Haskell Foundation, said they had previously made mistakes during simulated cyberattacks, and were concerned that future development mistakes could lead to legal consequences. 

"I didn't realize there was a risk of getting raided by the authorities because of that + saying mean things on the Internet," effectfully wrote in an X post. "For context, most [vulnerabilities] in the computational layer were either directly discovered by me or originated from my ideas." Effectfully did not respond to a request for comment from The Block.