Polymarket hacked for $700K via rewards system breach, user funds reportedly safe

Polymarket, the largest prediction market, was exploited on May 22, 2026, with hackers stealing around $700K in USDC and POL tokens by compromising a private key linked to their rewards payout system. The attacker drained $458K USDC and $200K POL through the UMA CTF Adapter on the Polygon network, then laundered the funds via multiple addresses and centralized exchanges. Polymarket's team confirmed that user funds and core infrastructure remain secure, attributing the breach to internal operations and promising ongoing investigations and key rotations. The incident highlights ongoing vulnerabilities in crypto security, though market reactions were moderate, with UMA token dropping 3.3% and POL price stable.