Breaking News: Polymarket Suffers Crypto Breach

News has just broken with several Polymarket users logged in expecting to check their open prediction markets, only to discover something far more alarming. Their account balances had been almost entirely wiped. Polymarket has since acknowledged that a vulnerability in a third party authentication provider had led to unauthorized account access and drained funds.

What's Been Reported So Far

On December 24, Polymarket officially confirmed that a “small number of users” were affected by unauthorized account drains. Allegedly, attackers exploited a security flaw introduced by a third party login provider used for authentication and has not breached Polymarket’s core protocol or infrastructure.

Polymarket has since stated that it’s smart contracts and prediction market systems remained secure throughout the incident. The breach was limited to user accounts that relied on external login tools that relied on email based wallet services which has become a growing risk area within Web 3.0 onboarding systems.

Third Party Authorisation Apps Risks

Polymarket has not officially named the third party provider responsible but many users are speculating that the issue involved Magic Labs. Magic Labs is a popular Web 3.0 onboarding service that allows users to log in with email addresses and automatically creates non custodial Ethereum wallets behind the scenes.

This login method has become popular among newer cryptocurrency users who may not yet have experience managing wallets, seed phrases or browser extensions. However, this incident has reignited concerns about whether third party authentication services introduce centralized points of failure into otherwise decentralized platforms.

Polymarket acknowledged this risk in its response, stating that the vulnerability originated outside its own systems and has since been resolved. The platform also reassured users that there is no ongoing risk at this time and that impacted users would be contacted directly.

Remember to be safe when investing in Cryptocurrency and ensure you utilise maximum security.

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Posted Using INLEO