Polymarket Suspends Trading Due to Third-Party Vendor Compromise

The prediction market platform Polymarket suspended trading on its international platform on Thursday due to a security incident: one of the third-party providers was compromised. The disruption affected the Predictions Trading API and was described as "major." Trading was paused for about an hour and resumed on Thursday afternoon.

What the platform reported

In an update on its status page, Polymarket reported that it switched to "cancel-only" mode after identifying and resolving the issue affecting operations. As of 19:05 UTC, all systems were operational. "One of our third-party providers was compromised, and we have reported this to the relevant law enforcement authorities. All affected parties will be compensated for their losses," the company stated. According to sources, the incident is related to a performance monitoring tool.

User complaints

The suspension of trading coincided with reports from users that their wallets on Polymarket were emptied: in some cases, positions were sold without their consent, and losses amounted to thousands of dollars. There is no official confirmation of these cases from the platform.

Not the first incident

In June, Polymarket already reported that hackers withdrew more than $2.9 million of user funds by compromising a third-party provider. The current case again raises the question of how much the platform relies on external contractors and how it verifies their security.