Polymarket was targeted on May 22 in an incident tied to its rewards payout system, with more than $700K in USDC and POL reportedly drained. The compromise appears linked to a private key, while the team said user funds and market resolution were not affected as it rotates backend keys and continues investigating.

On May 22, 2026, on-chain investigator ZachXBT said a Polymarket admin address on Polygon appeared to be compromised, initially estimating losses at about $520,000. Later updates suggested the stolen amount may have surpassed $600,000, with the attacker splitting funds across 15 addresses. Polymarket’s Shantikiran Chanal said the team is investigating while claiming user funds and market resolutions remain safe.

Polymarket is navigating a high-stakes week marked by global expansion pushes into Japan and regulatory bans in India, alongside a recent $520,000 smart contract exploit that left main user positions secure. Despite subdued Polygon (POL) token performance, the prediction giant continues to dominate 2026 trading volumes ahead of rumored token airdrops and an IPO.

Polymarket suffered an exploit on Polygon targeting its UMA CTF Adapter smart contract, with losses reported near $600,000. On-chain investigator ZachXBT flagged the incident and linked activity to wallet 0x8F98075db5d6C620e8D420A8c516E2F2059d9B91, while users were warned to pause platform activity. On-chain data showed 5,000 $POL being removed roughly every 30 seconds during the drain phase.

On-chain observers flagged unusual contract activity tied to Polymarket-linked infrastructure on Polygon, with outflows that appear to total more than $520,000. The activity was associated with addresses connected to the Polymarket UMA CTF Adapter, while an alleged attacker wallet and a related contract were also identified. Polymarket and UMA have not publicly clarified the incident details or whether users were directly impacted.

AmericanFortress published a cryptography paper describing a patent-pending, post-quantum signature method for hierarchical deterministic (HD) wallets. The design keeps existing BIP32-Ed25519 public keys and replaces the Ed25519 signing step with a ZK-STARK proof, aiming to avoid chain switches or mandatory fund migration. The paper also reports current performance figures, including sub-10-second signing proofs, 18–19 ms verification, and a fixed 218.4 KB signature size.

Polymarket is preparing a push into Japan by appointing Mike Eidlin as its local representative and starting a lobbying campaign, with the goal of receiving authorization to run prediction markets by 2030. The platform reported its first $10 billion monthly trading volume in March 2026 and said it reached 678,342 unique users in April as it rolls out updates such as Polymarket USD.

On May 21, 2026, the U.S. Securities and Exchange Commission said it is preparing a temporary regulatory exemption that would let eligible firms trial tokenized stock trading on blockchain networks under tight limits. The plan would test tokenized shares, automated market makers and crypto-native settlement, with conditions such as volume caps, whitelisted participants and time-limited approvals.