[BUG] Claude Code cannot find Git branch refs in packed-refs

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

In several of my Git repo folders, Claude Code hangs during startup prior to the "trusted folder" question. It did not do so before today, so this is likely new in Claude Code 2.1.69.
I am running Claude Code in a Command Prompt terminal in Windows Terminal under Windows 11 Enterprise version 23H2.

Using Process Monitor, I noted that it was repeatedly performing this operation:
CreateFile C:\{repo path}\.git\refs\heads\develop NAME NOT FOUND

The branch exists, and I confirmed that it is stored as a packed ref using the git command:
git -C C:\{repo path} pack-refs --unpack

I created a loose ref file using the commit hash, and that allowed me to reach the trusted folder prompt.

What Should Happen?

Claude Code should be able to handle Git repos where the branch refs are stored in packed-refs. In addition, if it cannot reach the Git branch ref, it should give up, report the error to the user, and proceed with startup.

Error Messages/Logs

Output from Process Monitor (repeated in a loop)

4:40:48.3731889 PM    claude.exe    28096    CreateFile    C:\{repo path}\.git\HEAD    SUCCESS    Desired Access: Read Attributes, Synchronize, Disposition: Open, Options: Synchronous IO Non-Alert, Attributes: n/a, ShareMode: Read, Write, Delete, AllocationSize: n/a, OpenResult: Opened
4:40:48.3732196 PM    claude.exe    28096    QueryAllInformationFile    C:\{repo path}\.git\HEAD    BUFFER OVERFLOW    CreationTime: 3/5/2026 2:32:34 PM, LastAccessTime: 3/5/2026 4:40:34 PM, LastWriteTime: 3/5/2026 2:32:34 PM, ChangeTime: 3/5/2026 2:32:34 PM, FileAttributes: A, AllocationSize: 24, EndOfFile: 24
4:40:48.3732271 PM    claude.exe    28096    QueryInformationVolume    C:\{repo path}\.git\HEAD    SUCCESS    VolumeCreationTime: 4/22/2024 2:29:23 PM, VolumeSerialNumber: 30C3-7410, SupportsObjects: True, VolumeLabel: Win
4:40:48.3732334 PM    claude.exe    28096    CloseFile    C:\{repo path}\.git\HEAD    SUCCESS    
4:40:48.3732846 PM    claude.exe    28096    CreateFile    C:\{repo path}\.git\config    SUCCESS    Desired Access: Read Attributes, Synchronize, Disposition: Open, Options: Synchronous IO Non-Alert, Attributes: n/a, ShareMode: Read, Write, Delete, AllocationSize: n/a, OpenResult: Opened
4:40:48.3733050 PM    claude.exe    28096    QueryAllInformationFile    C:\{repo path}\.git\config    BUFFER OVERFLOW    CreationTime: 2/26/2026 4:12:25 PM, LastAccessTime: 3/5/2026 4:40:34 PM, LastWriteTime: 2/26/2026 4:12:25 PM, ChangeTime: 2/26/2026 4:12:25 PM, FileAttributes: A, AllocationSize: 4,096, EndOfFile: 619
4:40:48.3733107 PM    claude.exe    28096    QueryInformationVolume    C:\{repo path}\.git\config    SUCCESS    VolumeCreationTime: 4/22/2024 2:29:23 PM, VolumeSerialNumber: 30C3-7410, SupportsObjects: True, VolumeLabel: Win
4:40:48.3733155 PM    claude.exe    28096    CloseFile    C:\{repo path}\.git\config    SUCCESS    
4:40:48.3733585 PM    claude.exe    28096    CreateFile    C:\{repo path}\.git\refs\heads\develop    NAME NOT FOUND    Desired Access: Read Attributes, Synchronize, Disposition: Open, Options: Synchronous IO Non-Alert, Attributes: n/a, ShareMode: Read, Write, Delete, AllocationSize: n/a

Steps to Reproduce

1. Prepare a folder with a Git repository.
2. See that the branch ref is stored in packed-refs rather than a loose file. (I don't know how to do this.)
3. Run Claude Code 2.1.69 in the folder.

Claude Model

Opus

Is this a regression?

Yes, this worked in a previous version

Last Working Version

2.1.68, probably

Claude Code Version

2.1.69

Platform

Anthropic API

Operating System

Windows

Terminal/Shell

Windows Terminal

Additional Information

_No response_