Cardano suffers Mainnet split due to transaction error: What ADA holders need to know

Shocking Chain Split: Unveiling Cardano's Nightmare Scenario

On November 21, 2025, the Cardano blockchain experienced a critical technical failure, causing a stir in the cryptocurrency community. A malformed delegation transaction triggered a fork in the Cardano chain, temporarily splitting the network into two distinct chains: one containing the problematic "poison" transaction and the other being a "healthy" chain without it. This event represents one of the most significant consequences of a blockchain fork in the operational history of Cardano, exposing vulnerabilities that have persisted in the core software library since 2022.

The root cause stems from a deserialization hash error in the underlying code of Cardano, which was not caught by the verification mechanism. The staking pool operator Homer J used AI-generated code to execute a transaction aimed at testing and reproducing a known vulnerability. Initially, this was just a personal challenge to identify system weaknesses, but it quickly escalated into a network-wide crisis. The execution of this malformed transaction led to a network split, as the newer node version accepted the transaction while the older nodes rejected it based on their validation rules. This divergence created competing chain histories, with different parts of the network operating under conflicting consensus rules. This incident underscores the critical issue that the stability of the Cardano network urgently requires immediate attention from developers and ecosystem participants.

Understanding the blockchain error recovery process that follows, the temporary nature of the split is crucial. Stake pool operators immediately reported the divergence in the block history, triggering coordinated action across the entire ecosystem. The Cardano team swiftly mobilized with Intersect and other ecosystem contributors to respond to the crisis through emergency node upgrades. This event showcased the vulnerabilities of complex blockchain systems and the built-in resilience mechanisms of distributed networks when operating as expected at critical moments.

ADA holders in panic: Direct consequences of network interruption

The announcement of the Mainnet split immediately caused ripples in the digital asset market, as ADAPrices plummeted as investors reacted to the unexpected network failure. However, the biggest concern for cryptocurrency investors is the security of their assets. Despite the worrying nature of chain splits, the fundamental security of ADA holders' assets remained intact throughout the event. The risks of cryptocurrency mainnet splits often trigger fears of lost funds or compromised transactions, but Cardano's architecture and response mechanisms prevented such catastrophic outcomes.

The market reaction reflects broader concerns about the reliability of blockchain rather than actual financial losses. ADA holders keep their coins on exchanges or in self-custody.wallets The experience did not result in direct asset loss, although price fluctuations led to temporary accounting concerns regarding portfolio valuation. The real consequences manifested as interruptions in transaction processing and delays in confirmations, as the network operated in a compromised state. During the partition, some transactions became ambiguous, existing on two versions of the chain without clear settlement finality. This uncertainty posed operational challenges for traders, businesses accepting ADA payments, and staking operations that rely on predictable network behavior.

Staking pool operators face unique pressures as their responsibilities to delegators become complicated by network splits. SPOs must decide which chain to prioritize while maintaining service to their delegators, and this uncertainty creates operational nightmares in various aspects.stakingEcosystem. This event underscores that the analysis of ADA trading errors must go beyond simple technical checks to encompass a broader ecological impact on various participant groups. IOHK founder Charles Hoskinson called for community unity during the crisis, recognizing that panic and division could exacerbate the situation. His message resonated with many in the community who understood that maintaining confidence in the network recovery process is just as important as the technical fixes themselves.

The Truth Behind the Chaos: Analyzing the Ripple Effect of Distorted Transactions

The erroneous transaction represents a specific encoding that violates Cardano's transaction format specifications, but the node validation rules operate inconsistently across different software versions. There is a flaw in the deserialization process – converting raw transaction data into structured data that the blockchain can interpret – which lay dormant for about three years before being exploited. This lengthy vulnerability window illustrates that even well-audited blockchain projects may harbor subtle errors deep within their code infrastructure. The transaction error in question is particularly related to ADA staking pool delegation parameters, designed to exploit the gap between how new and old nodes process the same data.

When Homer J broadcast this transaction over the network, a race condition occurred. Nodes running a newer version accepted and propagated the transaction based on their validation logic, while nodes running an older version rejected it as invalid. This caused an irreversible fork in blockchain history, as transactions processed after the erroneous transaction depended on whether that transaction was included in the ancestors of their chain. Subsequently, each chain processed subsequent blocks in different ways, creating independent effective histories without a mechanism for reconciliation, unless a set of transactions was completely discarded. This event revealed a critical gap in Cardano's validation framework and version compatibility protocol.

As developers scramble to understand what specifically causes transactions to become "toxic," the ripple effect spreads throughout the Cardano ecosystem. This transaction illustrates how a single improperly formatted input can lead to network-wide consequences, threatening the consensus itself. The requirements for blockchain error recovery processes become immediately apparent: the network needs to identify which chain represents valid consensus, roll back transactions on the incorrect chain (if applicable), and restore unified operations. This incident exposes Cardano's monitoring system, which, despite its complexity, still failed to flag this particular vulnerability pattern as a key risk to the network.

Homer J. acknowledged using AI-generated instructions while attempting this challenge, raising secondary concerns about the role of artificial intelligence in blockchain security testing. Relying on AI-generated code without comprehensive peer review or security validation created conditions where potential vulnerabilities became actual exploits. This aspect of the incident provides insights into how blockchain projects should govern security research and testing protocols. The experience of the Cardano team indicates that even decentralized projects need clearer guidelines regarding responsible vulnerability disclosure and testing boundaries.

Cardano's Recovery: Lessons Learned and the Path Forward

The recovery process began immediately after detecting the chain split, coordinated by Intersect to urgently upgrade to node versions 10.5.2 and 10.5.3. These patch versions implemented corrected deserialization logic and unified validation rules across all nodes. The speed of the response demonstrated the strength of Cardano's decentralized governance structure, in which staking pool operators and network participants share the responsibility of maintaining the network's integrity. Within hours of identifying the nature of the malformed transactions, a consensus was reached to roll back to the "healthy" chain, abandoning the branch containing toxic transactions. This decision was not made automatically but reflected the coordinated judgment among hundreds of independent staking pool operators and ecosystem participants.

The implementation of recovery technology involves synchronizing nodes to a common block height before erroneous transactions and then orderly advancing through corrected validation rules. Cryptocurrency holders experienced some temporary service interruptions, but ultimately found their assets intact on the recovered consensus chain. The Cardano team provided transparency in documenting the events and their resolutions, helping to restore community confidence. They released a detailed technical analysis explaining the origin of the deserialization error and the specific conditions required to trigger the error, demonstrating a sense of responsibility and commitment to resolving similar vulnerabilities.

Long-term impacts include enhanced validation testing protocols, stricter cross-version compatibility requirements, and improved monitoring systems aimed at detecting abnormal transaction patterns before they spread across the network. This event prompted a comprehensive code audit of the critical path library, with particular attention paid to serialization and deserialization functions, which may have similar vulnerabilities. The Cardano developer community has begun discussions on establishing a formal bug bounty program and clearer security research protocols to guide vulnerability discovery through responsible channels rather than relying on ad-hoc testing that could jeopardize network stability. These institutional improvements represent fundamental learnings that turn a crisis into a reinforcement of the system.

This event has also prompted the entire blockchain industry to reflect on the vulnerabilities of shared infrastructure. Many projects operate similar serialization libraries that may have similar vulnerabilities, which may never become apparent unless specifically tested. The experience of Cardano has become a case study for other blockchain development teams, helping them understand how version management and verification consistency can enhance network resilience. Gate continuously monitors such developments closely, supporting ecosystem health through robust platform infrastructure and prioritizing transaction security and user asset protection during network stress events. The restoration of full network consistency with node versions 10.5.2 and 10.5.3, coupled with a coordinated community response, reaffirmed that even significant technical failures do not have to undermine fundamental blockchain security principles, as long as governance structures can operate effectively.