Silence from Polyamory Group Fuels Power Abuse Allegations After Reported Hack of Polycule Trading Bot (January 2026)

• What Happened to Polycule?
• Hack or Smear Campaign?
• How Safe Are Prediction Market Bots?
• Will Users Get Their Money Back?
• The Bigger Picture: Trust in Decentralized Ecosystems
• What’s Next for Polymarket’s Bot Ecosystem?
• FAQs

The crypto world is buzzing after Polycule, a major automated trading bot for Polymarket, reported a $230K hack on January 7, 2026. Despite promises of patches and reimbursements, the team’s silence since January 12 has sparked accusations of a "rug pull," with competitors like Insiders.bot swooping in to lure users. This incident highlights the risks of unregulated Trading Bots and raises questions about accountability in decentralized finance. Here’s a deep dive into what happened—and why trust is crumbling.

What Happened to Polycule?

On January 7, 2026, Polycule—one of the largest automated trading bots on Polymarket—announced a security breach affecting $230,000 in user funds. The team pledged swift action: patches by the weekend, a security audit, and full reimbursements. But by January 12, radio silence had taken over. Competitors seized the moment. Ryan Chi, founder of Insiders.bot, publicly accused Polycule of a "rug pull and run," citing frozen withdrawals and unanswered queries. His platform offered 50% discounts to fleeing users, positioning itself as the "legitimate successor" to Polycule’s ecosystem. Meanwhile, Polymarket’s third-party bot sector reeled, with users vowing to abandon automated services altogether.

Hack or Smear Campaign?

The line between exploit and exploitation blurred fast. Chi’s X post claimed Polycule was "provably compromised," but without transparency from the Polycule team, the narrative spiraled. Insiders.bot doubled down, slashing fees and rolling out discount codes while denying any involvement in the hack. "Someone must fill the gap Polycule left," Chi declared. Yet skeptics noted the timing: the accusations coincided neatly with Insiders.bot’s aggressive marketing push. In DeFi’s Wild West, where custody risks loom large and regulation is sparse, such opportunism isn’t rare—but it’s rarely this blatant.

How Safe Are Prediction Market Bots?

Automated trading bots like Polycule thrive in crypto’s gray areas. Dozens reportedly profit off Polymarket’s bitcoin markets, pulling in tens of thousands monthly. But success breeds cutthroat competition. The Polycule incident underscores the sector’s vulnerabilities: opaque operations, minimal oversight, and incentives to sabotage rivals. While some bots operate ethically, others mirror the "rug pull" playbook—sudden silence, vanished funds, and a trail of angry users. The irony? Even legitimate projects face suspicion during outages, thanks to DeFi’s trust deficit.

Will Users Get Their Money Back?

For victims, the path to reimbursement remains foggy. Polycule’s initial pledge to compensate users from its reserves now seems shaky without updates. Some have publicly shared wallet addresses in hopes of recovery, but no mechanism exists yet. Insiders.bot’s promise to process claims within "1–2 weeks" offers scant comfort, especially given its vested interest in poaching users. As one trader lamented on X: "This is why I’ll stick to manual trades—bots don’t cry when they rob you."

The Bigger Picture: Trust in Decentralized Ecosystems

Polycule’s saga isn’t just about lost funds—it’s a stress test for DeFi’s self-governance model. Without clear authorities, competitors often act as "judge, jury, and profiteer" when projects fail. The BTCC team notes that similar incidents have eroded trust in past bull markets: "Users flock to convenience until the first exit scam. Then it’s every trader for themselves." Until Polycule breaks its silence or independent audits clarify the hack, the court of public opinion will side with the loudest voice—in this case, Ryan Chi’s.

What’s Next for Polymarket’s Bot Ecosystem?

Short-term, expect a land grab. Insiders.bot isn’t alone; other platforms will likely dangle incentives to absorb Polycule’s user base. Long-term, the incident may spur demand for insured or audited bots—or push traders back to manual strategies. For now, the takeaway is clear: in unregulated corners of crypto, silence isn’t just suspicious—it’s expensive.

FAQs

Was Polycule hacked or was it a rug pull?

Unclear. Polycule confirmed a hack on January 7 but hasn’t updated since January 12, fueling speculation. Competitors like Insiders.bot allege it’s a scam.

How much money was stolen in the Polycule hack?

Approximately $230,000 in user funds, per Polycule’s initial statement.

Are trading bots like Polycule safe to use?

Risky. Most operate without regulation, and custody issues are common. Always research audits and insurance.

What’s Insiders.bot’s role in this?

It’s a competitor offering discounts to Polycule users while denying involvement in the hack.