Polymarket halts international trading, vows full reimbursement after third-party hack
Polymarket temporarily halted trading on its international platform Thursday afternoon after discovering a compromised third-party provider. The company took the offshore site offline as a precaution and pledged to fully reimburse affected users. Polymarket emphasized the breach stemmed from an external vendor, not its own systems. Trading has since resumed, according to Wired.com. The incident involved unauthorized withdrawals from user wallets, with reports surfacing on social media before the official response.
The breach hits Polymarket's offshore international platform, sparing the separate CFTC-regulated US exchange but staining the shared brand. Traders with funds on the international site face frozen positions while Polymarket investigates alongside authorities. The incident exposes third-party data providers as a critical vulnerability even for platforms with audited smart contracts.
Competitors like Kalshi and ForecastEx can now point to concrete losses when arguing that regulated custody infrastructure offers stronger protection. Polymarket's reimbursement promise will test its treasury and set a benchmark that rivals will be measured against in future breaches. Trust damage from the offshore site bleeds into the regulated US venue too.
This third-party breach joins a string of recent Polymarket security incidents, including a prior supply chain attack and separate election-integrity probes, as the platform faces mounting pressure to demonstrate operational reliability across both its regulated and offshore venues.