Polymarket patches the “ghost trades” loophole: the abnormal trade rate drops from 30% to 0.17%, effective one week after V2 goes live

Prediction market Polymarket completed the core patch for the “Ghost Fill” (ghost trading) exploit on May 4. The abnormal trade ratio fell from a peak of 30% to 0.17%. Polymarket engineer Josh Stevens announced that this patch is the core of the V2 upgrade, requiring a rewrite of the entire trading underlying structure. It became effective one week after going live.

What is Ghost Fill: trades occur, but the counterparty’s funds can’t be recovered

“Ghost Fill” is an attack method where an order appears to be filled, but the counterparty’s funds have actually been withdrawn. Specifically, at the exact moment the attacker confirms order execution, the attacker uses any of the following methods to move the funds:

Revoke smart contract allowance (revoke allowance)

Transfer wallet funds to another address

Modify the nonce so the original order becomes invalid

Actively cancel the order

The result is: the order counterparty believes it bought the contract at a specific price, but the funds are no longer in the attacker’s wallet. The Polymarket order book shows filled trades, but there is no corresponding on-chain settlement in reality. What affected users see is “misleading fill price, with expected profit falling through.”

From prank to LP arbitrage: how the attack scale expanded

At first, the Ghost Fill scale was small—used by only a few users to “pretend to fill” and trick other people placing orders. But recently, it has been systematically used to extract Polymarket liquidity provider (LP) rewards:

Attackers post large orders on the order book, occupying LP reward quotas

When the order is about to be consumed, they cancel it using the Ghost Fill method, avoiding real execution risk

The result is “take LP rewards without bearing market-making risk,” i.e., zero-cost arbitrage

After this arbitrage model expanded, the Ghost Fill proportion once surged to 30%—meaning roughly three-tenths of “trades” on the platform had not actually been matched and settled on-chain, severely eroding the credibility of the Polymarket order book.

V2 patch impact: 0.17% and still decreasing

Polymarket is not patching a single function; it is rewriting the entire trading underlying structure and rolling out a V2 system, going live this week. In his announcement, Stevens said: “Ghost Fill fell from a peak of 30% to 0.17%, and on that day it continued trending toward zero. We know this issue damaged everyone’s user experience. We’re truly sorry—and now it should be very different.”

V2 not only fixes Ghost Fill, but also gives Polymarket’s engineering team more flexibility at the underlying layer to patch against similar attacks in the future. For LPs and regular users alike, this means the platform is entering a “credibility repair” phase—fills shown on the order book are now much closer to the true on-chain state.

For Polymarket’s overall trajectory, this patch was completed after milestones such as April’s spot trading volume surpassing $25.7 billion, a valuation of $15.8 billion, and the launch of perpetual contracts (10× leverage, BTC, NVDA, gold). abmedia’s full Polymarket breakdown has covered related events; this case is the key underlying baseline patch for the V2 platform overhaul.

This article about Polymarket patching the “Ghost Fill” exploit: the abnormal fill rate dropped from 30% to 0.17% after V2 went live, with effectiveness seen within one week. First appeared on Chain News ABMedia.