Paypal is pretty secure, I've never had an issue. the likely scenario is you went to an unofficial paypal site sent through a phishing email and entered your password, so then they had access to your paypal account. Change your password if you have not done so already. Google paypal hacked, I just glanced at the results, but the phishing email is the only possibility I saw, no press releases that I saw.
Also make sure you contact paypal, if your account was compromised, they will have logs.
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