diff --git a/tests/neg/i5418.scala b/tests/neg/i5418.scala
new file mode 100644
index 000000000000..900cf6a70ccc
--- /dev/null
+++ b/tests/neg/i5418.scala
@@ -0,0 +1,14 @@
+class Test {
+  class Tree[A]
+
+  def fromOrderedKeys[A](xs: Iterator[A]): Tree[A] = ???
+
+  def from[E](it: Iterable[E]): Tree[E] =
+    it match {
+      case r: Range =>
+        val it = r.iterator
+
+        // instantiation of covariant GADTs is unsound
+        fromOrderedKeys(it) // error: type mismatch: found: Iterator[Int](it), required Iterator[E]
+    }
+}