Attackers Steal $400K from Predict.fun, Binance Wallet's Prediction Feature

Approximately $400,000 was taken from Predict.fun users, a prediction market integrated into Binance's wallet app. The theft occurred two days after Binance began trading the project's token at a $1.43 billion valuation.

Predict.fun has stated that all impacted users will receive full compensation. Yet the token has not yet launched, and traders are already purchasing it with borrowed money.

How Did the Breach at Predict.fun Happen?

The stolen funds were USDT, a stablecoin designed to maintain a $1 value. The platform lets users purchase binary shares on real-world outcomes, such as elections or football results.

According to the company's preliminary findings, the vulnerability came from an unlikely source: the application programming interface (API) documentation site, a guide for developers integrating with the platform.

That site, operated by a third party, has been taken offline. Predict.fun has not revealed the number of affected users.

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

This is not the first such case. In June, rival Polymarket pledged full refunds after a third-party vendor's code caused about $3 million in losses.

Scrutiny on Predict.fun's $1.4 Billion Valuation

The incident comes just two days after Binance Futures began offering PREDICT, the token of Predict.fun. These pre-market contracts allow trading before the token launch, with leverage up to five times.

However, analysts view the $1.43 valuation as excessive.

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

The same analyst examined 28 previous tokens listed by Binance in this manner. On average, one month after launch, such tokens had fallen 49%. Predict.fun has still not disclosed the ownership distribution of PREDICT.

Why Is Binance Often Mentioned?

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

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

Within four months, two prediction markets have now committed to refunds after breaches at external providers. PREDICT traders are awaiting the full post-mortem and details on token ownership.