Polymarket halts trading after compromise, impacted users will be 'made whole'

Polymarket temporarily stopped trading on its international platform for nearly an hour after a third-party service provider was compromised. The company said it had found and fixed an issue affecting Polymarket.com and referred the incident to law enforcement. Trading resumed at 3 p.m. Eastern time on Thursday. Users reported on the platform’s Discord channel that their crypto wallets had been emptied, though Polymarket did not confirm individual losses. The Block, citing blockchain analytics group Arkham, reported that about $2.65 million in cryptocurrency had been taken. Polymarket said affected traders would be fully reimbursed. Its U.S.-based platform did not appear to be affected.

The incident highlights the security risks posed by attacks on vendors that provide services to large online platforms, and it stands out because users may have lost funds. Polymarket was valued at $21 billion in September after investors led by Donald Trump Jr. put $1 billion into the company. The platform and rival Kalshi are also at the center of a legal and political dispute over whether states or the federal government should regulate prediction-market betting. Separately, Polymarket is investigating reports of suspicious wagers around Israel’s elections and the U.S. midterms, amid broader concerns about insider trading on prediction markets. Kalshi has also examined suspicious bets related to President Donald Trump’s choice of press secretary.