Synopsis: A long-dormant Cardano wallet lost over $6 million after swapping 14.4 million ADA for a low-liquidity stablecoin, USDA, causing severe slippage and spotlighting DeFi liquidity risks.
A dormant Cardano wallet shocked the crypto world by losing over $6 million in a single trade on November 16, 2025. After five years of inactivity, the wallet swapped 14.4 million ADA, worth around $6.9 million, for just 847,695 USDA, a low-profile Cardano-native stablecoin intended to be pegged to $1.
This unexpected blunder caused a massive spike in USDA’s price and wiped out nearly 88% of the trade value, highlighting the dangers of trading large sums in illiquid pools without proper caution.
The Costly Trade and Its Impact
The wallet, untouched since September 2020, reappeared on Minswap, a popular decentralized exchange (DEX) on Cardano. It attempted a swap through the ADA/USDA pool, which only had $1.9 million in total liquidity far too little for such a large order. As a result, the trade triggered severe slippage, with the user effectively paying over $8 per USDA token at execution instead of the intended $1 peg.
This trade inflated USDA’s price temporarily to nearly $1.26 and in some DEX quotes as high as $68 before prices corrected back near $1.04. The extreme price distortion not only led to a direct loss of approximately $6.05 million but also created arbitrage opportunities for other traders to capitalize on the spike. After the trade, the wallet held the USDA tokens but showed no additional activity.
What Went Wrong? The Mechanics Behind the Error
This incident is a classic “fat-finger” error potentially a human mistake such as selecting the wrong stablecoin ticker or neglecting slippage protection. The trader’s previous test swap, conducted just 33 seconds earlier for a different USD stablecoin (ticker: USD, not USDA), suggests possible confusion.
USDA, issued by Anzens, has a modest market cap around $10.6 million and low trading volume. In contrast, more liquid USD pegged tokens exist within Cardano’s ecosystem. The wallet’s choice to route a $6.9 million trade through a micro-cap pool lacking adequate liquidity was a risky misstep. No slippage limit was set, so the transaction went through at the worst price. If the trade had happened in a deeper pool like ADA/USDC, losses would have been far smaller.
Lessons for Traders in DeFi Markets
This episode serves as a stark reminder to all traders, especially whales dealing with large sums. Large orders must never be executed in low-liquidity pools without careful slippage tolerance settings or splitting trades into smaller portions. Failure to do so risks catastrophic value loss, even for long-holding wallets.
Decentralized finance (DeFi) markets remain unforgiving to size and speed. This wallet’s sudden reactivation and costly error after five years illustrate how dormant capital can still fall prey to modern liquidity pitfalls. The incident is now widely discussed across social platforms.
Future Precautions and Industry Insights
Experts urge using specialized tools to check pool depths before trading and to consider over-the-counter (OTC) desks for large transactions. Limit orders and aggregators with slippage checks can prevent similar blunders.
While Cardano’s DeFi TVL has grown recently, liquidity concentration risks remain. This incident shines light on ecosystem maturity gaps and the urgent need for better trade execution safeguards.
Written By Fazal Ul Vahab C H