News linked to both this project and an event.
Odaily News The prediction market platform Polymarket issued a "resolution clarification" that overturned a market result that had already appeared to be settled. This led to a 20-year-old student's $35,000 bet being declared invalid, while a total of approximately $3.8 million in positions across 1,838 accounts on the platform were liquidated.This clarification clause was written into the platform's rulebook, allowing for retroactive interpretative corrections to market settlement results, thereby altering the final payout. The incident has sparked strong dissatisfaction among traders, who argue that this "post-hoc ruling" mechanism undermines the certainty of market rules, and has ignited widespread controversy within the Polymarket and Kalshi communities.According to user disclosures, the incident originates from a case made public on June 13, where a market result that had ostensibly been settled was later reversed due to a change in rule interpretation.Industry analysts believe that this type of mechanism introduces "settlement clarification risk" into prediction markets, which is a type of tail risk event that cannot be hedged. If such operations occur frequently, they could drive high-risk liquidity away from the current platform towards trading venues regulated by the CFTC or those with formal arbitration mechanisms.Furthermore, this event is seen as one in a recent series of controversies, including settlement disputes surrounding the UMA oracle and Strategy's Bitcoin-related markets, which continue to test market participants' trust in the "finality" of prediction markets. (Cryptobriefing)
Josh, a Polymarket representative, stated that neither Polymarket nor UMA contracts were exploited, all user funds remain secure, usage of Polymarket.com is unaffected, and platform operations continue as normal. He added that the incident stemmed from the leakage of a six-year-old private key used for internal deposit configurations, which led to funds being sent to the associated address. Polymarket has since rotated this private key, revoked all production environment permissions, and will migrate all private keys to the KMS key management system.
According to Josh Stevens, Engineering Vice President at Polymarket, $164,000 of the $573,200 stolen due to a compromised private key has been frozen through collaboration among ZachXBT, Bitcoin Vietnam, and ChangeNOW. Josh previously stated that this incident did not involve an exploit of Polymarket or the UMA contract, user funds remain secure, and Polymarket.com remains fully operational. The issue originated from a six-year-old private key that was leaked; this key existed within an internal supplementary funding configuration, resulting in the unauthorized transfer of funds to the associated address.
Polymarket staff member Shantikiran Chanal posted on platform X, stating that they have taken note of the security reports related to reward distribution, and that user funds and market settlements remain safe. The investigation indicates that a private key leak occurred in a wallet used for internal operations, and the issue is not related to contracts or core infrastructure. Further updates will be provided.Previous report: ZachXBT stated that the Polymarket UMA CTF Adapter contract allegedly came under attack on Polygon, with over $520,000 having been drained.