The following logic can be found in src/system/FileLoader.ts inside of the absolute() function, and is what's causing this hang.
do {
const module = path.resolve(cwd, 'node_modules', pathname);
if (this._fs.existsSync(module)) {
return module;
}
cwd = path.dirname(cwd);
} while (cwd !== '/');
In windows the root is C:\\ so the provided loop would never exit.