Gala Games, a blockchain gaming platform, recently faced a security incident where an attacker minted Gala (GALA) tokens worth $200 million. The attacker managed to sell a small portion of the tokens before Gala Games froze the wallet. However, on Tuesday, the attacker’s wallet returned 5913.2 ETH, equivalent to $22.3 million, to Gala Games. This swift recovery was credited to the effective response of Gala Games and the involvement of federal law enforcement agencies. The GalaChain blocklist protocol feature was utilized to freeze 4.4 billion GALA tokens out of the 5 billion minted within just 45 minutes to mitigate the impact of the breach.
Despite Gala Games not disclosing the identity or method used by the attacker, some community members suggest that a security contractor might have been involved, who accessed the wallet without using a VPN. Eric Schiermeyer, co-founder and CEO of Gala Games, announced plans to repurchase the equivalent GALA tokens using the returned ETH and then burn them to ensure the ecosystem’s security. Additionally, a governance vote is being initiated to determine if the blocklisted 4.4 billion GALA tokens will be considered “burned,” effectively removing them from circulation. DWF Labs, a technology firm, purchased 28 million GALA tokens from the open market to stabilize the token’s value.
In a surprising turn of events, the co-founders of Gala Games, Eric Schiermeyer and Wright Thurston, have filed lawsuits against each other. Schiermeyer accuses Thurston and his investment entity of unlawfully acquiring $130 million worth of GALA tokens, which were supposed to be securely held for Gala Games’ benefit. Thurston, on the other hand, accuses Schiermeyer of mismanaging the company and diverting millions of dollars for personal use. The legal battle also involves a separate lawsuit filed by the SEC against Thurston and his firm for an unauthorized investment offering. Both co-founders are seeking to remove each other from their positions as directors of the company as a result of these accusations and disagreements.
The decision to repurchase and burn the equivalent GALA tokens using the returned ETH showcases Gala Games’ commitment to addressing the aftermath of the security incident and prioritizing the security of their ecosystem. The involvement of federal law enforcement agencies and the effective response by Gala Games played a crucial role in the swift recovery of the stolen funds. The governance vote to determine the fate of the blocklisted GALA tokens and the purchase of tokens from the open market by DWF Labs further demonstrate the efforts being made to stabilize the token’s value and ensure the well-being of the community. Despite the internal disputes between the co-founders, Gala Games continues to navigate these challenges while striving to uphold the integrity of their platform and the trust of their users. At the time of writing, GALA is trading at $0.0448, showing a 6.64% increase over the past day.
