Cardano Blockchain Splits After Malformed Transaction Causes Disruption

TLDR

• Cardano’s blockchain experienced a temporary split due to a malformed delegation transaction.
• The split occurred because newer node versions accepted the faulty transaction, while older versions rejected it.
• Cardano developers applied a hard fork to reconcile the two diverging chains and restore normal block production.
• Charles Hoskinson linked the incident to an attack by a disgruntled stake pool operator aiming to harm Cardano’s reputation.
• The attacker’s wallet was identified within the same day and an FBI investigation was initiated.

Cardano’s blockchain encountered an unexpected issue when a malformed delegation transaction triggered a chain split early Friday. A flaw in the network’s node software caused a brief divergence in the blockchain. Developers quickly addressed the problem, confirming that block production continued without interruption.

Cardano Resolves Split with Hard Fork Action

The issue began when a faulty delegation transaction successfully passed validation on newer node versions. Older node versions rejected the same transaction, leading to a network split. This led to two parallel chains, with one branch growing faster than the other due to accumulated stake weight.

According to Cardano’s governance organisation, Intersect, the bug stemmed from a flaw in an underlying software library. The validation code failed to detect the error, allowing the malformed transaction to enter the blockchain. This validation mismatch triggered the split, with nodes running outdated software rejecting the transaction.

The discrepancy between the two branches of the blockchain caused some disruptions, but Cardano’s developers quickly applied a hard fork to address the issue. The fork helped reconcile the chains and resume normal block production. Intersect stated that the network remained online throughout the incident.

Chain Split Linked to Attack from Stake Pool Operator

Charles Hoskinson, Cardano’s co-founder, attributed the split to a “premeditated attack” by a disgruntled stake pool operator. Hoskinson claimed the operator targeted Cardano’s network in an effort to damage the brand and reputation of Input/Output Global. He also confirmed that the network responded swiftly and identified the malicious wallet by the same day.

Hoskinson further explained that the attacker was active in the “Fake Fred” Discord server and was attempting to exploit the vulnerability. He revealed that an FBI investigation had been initiated to look into the matter. Despite the severity of the incident, Hoskinson praised the network for its resilience in handling the attack.

The faulty transaction was traced back to a participant from Cardano’s Incentivised Testnet (ITN) era. Hoskinson acknowledged that every user was impacted, as staking pool operators (SPOs) lost block rewards due to “double spends.”

A user on X, identified as Homer J., admitted to submitting the transaction that triggered the chain split. Homer J. claimed that they were experimenting with the network and did not foresee the consequences of their actions. They apologized for the incident, expressing regret for the stress caused to the Cardano community.

Homer J. explained that they had used AI-generated instructions during their experiment and were unaware of the full scale of the problem. Despite their admission, Cardano’s developers assured the community that they acted quickly to resolve the issue. Hoskinson encouraged SPOs to update their software to the latest version to prevent further disruptions.

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