Polymarket users suffer attack and company blames partner failure

Source: PortaldoBitcoin Original Title: Polymarket Users Suffer Attack and Company Blames Partner Failure Original Link: The decentralized prediction markets platform Polymarket confirmed that a recent security breach affected some of its users following the exploitation of a vulnerability associated with a third-party authentication provider.

Initial reports began circulating earlier this week on social media platforms like X and Reddit, where users reported unauthorized access to their accounts and loss of funds held on the platform.

In one account, a user stated they received three unsuccessful login attempt alerts, despite no signs of device compromise or other accounts linked to the same email. However, upon accessing Polymarket, they noticed all positions had been closed and the remaining balance was nearly zero.

Other testimonials describe a similar pattern, with prior login notifications and accounts being emptied shortly afterward, despite users claiming they did not click on suspicious links and maintained basic security measures such as two-factor authentication on their email.

According to information shared on social media, the cases seem to be concentrated among users who created accounts on Polymarket through Magic Labs, a service that allows login with an email address and automatically generates non-custodial Ethereum wallets. This type of registration is common among beginners in the cryptocurrency market who do not yet use their own wallets, which may have expanded the scope of the problem.

On Tuesday, Polymarket officially acknowledged the incident on its Discord channel, stating that they identified and fixed the vulnerability affecting a limited number of users. The company said the vulnerability originated from an external authentication provider and has now been corrected, with no additional risks at this time.

The platform did not disclose how many accounts were impacted or the total amount potentially lost, nor did it reveal the name of the third-party service involved, but stated it will contact the affected users directly.

“We recently identified and resolved a security issue affecting a small number of users,” wrote Polymarket on Discord. “The problem was caused by a vulnerability introduced by a third-party authentication provider.”

The incident rekindles concerns about security on the platform, which has faced similar situations in the past. In September 2024, users accessing the service via Google accounts reported wallet drainings after attacks that used “proxy” function calls to transfer USDC to phishing addresses.

At that time, Polymarket also pointed to possible flaws related to external authentication providers. More recently, a phishing campaign exploiting comment sections on the site itself led to losses exceeding US$500,000, after scammers tricked users into logging into fraudulent pages disguised as legitimate.