by Coinstrooper Crypto Articles
Quick Take
  • Attackers took about $400,000 from users of Predict.fun, the prediction market built into Binance’s wallet app.
  • It happened two days after Binance opened trading on the project’s token at a $1.43 billion price tag.
  • Predict.fun says every affected user will be paid back in full.
  • However, the token has not even launched yet, and traders are already buying it with borrowed money.

What Happened

Predict.fun says every affected user will be paid back in full. However, the token has not even launched yet, and traders are already buying it with borrowed money.

The incident comes only two days after Binance Futures started offering PREDICT, the token of Predict.fun. These pre-market contracts let people trade a token before it launches, with up to five times leverage.

The analyst also checked 28 earlier tokens Binance listed this way. A month after launch, the typical one was down 49%. Predict.fun still has not said who owns how much of PREDICT.

YZi Labs, the investment firm backed by Binance founder Changpeng Zhao, also expanded its stake in April.

The post Hackers Drain $400,000 From Binance-Linked Prediction Market appeared first on BeInCrypto.

Market Context

Attackers took about $400,000 from users of Predict.fun, the prediction market built into Binance’s wallet app. It happened two days after Binance opened trading on the project’s token at a $1.43 billion price tag.

This has happened before. In June, rival Polymarket pledged full refunds after an outside vendor’s code drained about $3 million from users.

“At the current price, its valuation is $1.43 billion… dozens of times higher than comparable projects,” one analyst indicated.

Two prediction markets have now promised refunds after breaches at outside providers in four months. PREDICT traders are waiting on the full post-mortem and the token’s ownership numbers.

Why It Matters

The company’s early findings point to an unlikely weak spot. It is the application programming interface (API) documentation site, a help page showing developers how to connect to the platform.

Details

How Did the Attackers Get Into Predict.fun?

The stolen money was USDT, a digital token built to stay worth $1. Predict.fun lets users buy yes-or-no shares on real-world events, such as elections or football results.

The site, run by an outside company, is now offline. Predict.fun has not said how many users were hit.

“As such, we will fully reimburse all affected users for any funds lost as a direct result of this incident,” the team stated.

Predict.fun’s $1.4 Billion Valuation Under Scrutiny

However, according to analysts, the $1.43 valuation goes overboard.

Why Does Binance’s Name Keep Coming Up?

Binance does not own the platform, but Predict.fun powers the prediction tab that Binance Wallet began testing in March.