Hackers stole funds from some users of Polymarket's international exchange after compromising a third-party provider. The company halted trading, resumed it at 3 p.m. ET, and pledged to reimburse affected traders. The incident comes days before the U.S. midterm elections.
Some users of Polymarket's international prediction market exchange had funds stolen from their accounts after hackers breached an unnamed third-party provider. Polymarket has contacted law enforcement and pledged to reimburse any affected trader. It is unclear how many users were impacted, and the company's U.S. platform was not compromised.
Traders flag unauthorized withdrawals
Traders first reported on social media that they were seeing unauthorized withdrawals from their accounts on Thursday afternoon. In response, Polymarket halted trading on its international platform.
The company said it fixed the issue on its end and that trading resumed at 3 p.m. ET. Polymarket later told users in a Discord chatroom that those with less than $10,000 taken from their wallets will have funds restored by Oct. 30. Users with more than that withdrawn will have to sign a release form to receive their restoration.
DebugBear named as the likely source
A person familiar with the matter told CNBC that the issue stemmed from a hack of DebugBear, a website performance monitoring platform. DebugBear said in a post on X that it was impacted by a security incident on Thursday. It did not immediately respond to CNBC's request for comment.
The same person said Polymarket referred the matter to U.K. law enforcement, because DebugBear is based there. Meanwhile, an analysis by two analytics firms, Betting Intelligence and Polysights, found that one account withdrew at least $2.7 million across 710 other wallets on Thursday.
A similar incident hit in June
Polymarket's international exchange operates as a decentralized finance platform on the Polygon blockchain and is not regulated in the U.S. The disruption comes days before both the international and U.S. exchanges are expected to see heightened volumes during the U.S. midterm elections on Nov. 3.
In June, Polymarket said a third-party vendor had been compromised and that it would refund affected users.
Source: CNBC
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