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Polymarket pushes toward Japan as $700K wallet drain and US oversight probe hit platform
Polymarket faces Japan expansion pressure, a $700K wallet drain, and US oversight scrutiny while Bitcoin chops near $77K.
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Prediction markets are having a moment. And not entirely the good kind.
Polymarket just crossed $7.2B in monthly trading volume. Now Congress, hackers, and Japanese regulators all want a piece.
Today we unpack what happens when a breakout crypto platform grows faster than its guardrails.
Polymarket says user funds are safe after $700K wallet drain
Attackers compromised an internal Polygon admin wallet and siphoned roughly $700K in POL tokens.
Blockchain sleuth ZachXBT flagged the exploit, tracing it to a Polymarket UMA CTF adapter contract.
The stolen funds were split across multiple wallets, but Polymarket insists no user deposits were touched.
For a platform processing billions monthly, even a contained breach raises uncomfortable trust questions.
Markets
Bitcoin treads water as new Fed chair inherits a confidence crisis
Kevin Warsh was confirmed by the Senate 54-45 to lead the Federal Reserve.
He inherits rising inflation expectations, with the one-year outlook jumping to 4.8%.
Bitcoin has tested $77K as resistance all week without breaking through.
A few outliers bucked the trend: NEAR surged 26%, ONDO climbed 14%, and Worldcoin gained 13%.
BTC hovered near $77K, ETH sat around $2,100, SOL held at $87, and XRP slipped to $1.35.
House Oversight chair demands data from Kalshi and Polymarket over suspicious bets
Committee Chair James Comer sent letters to both platform CEOs seeking trading records.
The probe centers on potential insider trading in prediction markets tied to political events.
Stricter regulation could reshape how these platforms onboard users and list contracts.
Polymarket hires Japan rep, targets regulatory approval by 2030
Bloomberg reports the platform appointed Mike Eidlin to lead its lobbying push in Tokyo.
The goal is getting Japanese regulators to classify event trading as a regulated financial product.
Monthly prediction market volumes ballooned from $1.2B in early 2025 to over $20B by January 2026.
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Until next time.
Estéfano
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