Polymarket pauses trading after $2.65m exploit of third-party provider

The prediction market platform entered cancel-only mode on 29 October after users reported drained wallets, with the company promising to reimburse those affected by the breach.

By Divyansh Mishra, YourKhabri DeskOct 29, 2026, 07:07 PM UTC2 min readPolymarketExploitSecurityPolygon

Logo: PolymarketScan logo; photo: Brynn Who Likes Editing, Public domain

Key takeaways

1Polymarket paused trading and relayers on 29 October following a security breach.
2An attacker wallet holds approximately $2.65 million in POL tokens according to Arkham data.
3The platform attributed the incident to a compromise of a third-party provider.
4Polymarket said it will reimburse all users who lost funds during the exploit.

Polymarket halted trading and paused its relayer services on 29 October after an exploit resulted in the loss of $2.65 million. The prediction platform moved into a cancel-only mode, allowing users to withdraw existing orders while blocking all new buy and sell activity.

The company said the breach occurred because a third-party provider was compromised. Reports of drained wallets began appearing earlier in the day, leading the platform to restrict access to its international services. Data from Arkham Intelligence, cited by Decrypt, showed a suspected attacker wallet holding approximately $2.65 million in POL tokens.

One individual trader reported an $800,000 loss from their account, according to The Defiant. Polymarket said on its status page that it had temporarily halted trading out of an abundance of caution while it worked to bring the platform back online. The firm later said it had identified and fixed the specific issue causing the vulnerability.

Polymarket is a decentralised platform that allows users to trade on the outcomes of events like elections, sporting matches, and economic data. It uses the Polygon blockchain to settle trades and has become a major venue for political speculation. The platform recently faced legal pressure in the United States, where regulators have scrutinised its operations.

MetaMask, which offers access to Polymarket’s markets within its own app, said its users were not impacted by the security event. The wallet provider said in a post on X that it does not use the front end or software development kits that were compromised in this breach. It confirmed that its internal integration remained secure.

Polymarket said it has referred the incident to relevant law enforcement agencies as it continues to investigate the full extent of the losses. The company also announced it will reimburse every user who was affected by the exploit. The platform did not provide a specific timeline for when full trading services would resume.

The security breach occurs just days before a planned technical update for the platform. Polymarket is scheduled to launch its Protocol V2 on 2 November, which includes a move to a single market for pUSD. The company has not said if this schedule will change because of the exploit.

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