Web3 gaming platform Gala Games loses over $200 million in potential exploit, GALA plummets 15%

Quick Take

  • The treasury of the web3 gaming platform Gala Games appears to have been hacked Monday. 
  • Someone minted 5 billion GALA tokens worth over $200 million. 
  • GALA fell nearly 15% following the exploit. 

Gala Games, a web3 gaming firm, appears to have suffered an exploit Monday, with someone minting 5 billion GALA tokens worth around $206 million, according to the blockchain explorer Etherscan

Following the incident, GALA, the platform's native token, plummeted nearly 15% from $0.0467 at 3:00 p.m. ET (19:00 UTC) to $0.0397 at around 5:25 p.m. ET (21:25 UTC) on May 20, based on data from The Block's price page for the token.

Overall, the token's price fell 5.77% within the past day. GALA maintains a $1.7 billion market capitalization with a circulating supply of 40.6 billion. 

GALA price performance. Image: The Block Prices

The situation is developing, and The Block contacted Gala Games for comment. 

Previous Gala Games exploit

In early 2021, Gala Games lost $130 million after around 8.65 billion GALA tokens were stolen. Eric Schiermeyer, one of the firm's co-founders, sued Wright Thurston, the other co-founder, for allegedly participating in the hack. 

"When confronted about his theft of company GALA, Thurston falsely stated that he simply intended to hold the GALA in secure wallets for the benefit of Gala Games,” according to the August 2023 lawsuit. "However, last year Thurston and/or [his company] began moving the stolen tokens from those wallets and exchanging or selling them in a complex web of obfuscatory transactions. He was able to exchange, hide or sell approximately $130 million worth of the stolen GALA tokens before Gala Games could stop him." Schiermeyer added elsewhere in the complaint that Thurston "has enriched himself through his
pattern of deception."

Thurston then issued his own lawsuit against Schiermeyer claiming that he used company funds for personal use, The Block previously reported

The United States Securities and Exchange Commission also sued Thurston and another of these companies in March 2023 for allegedly selling $18 million worth of unregistered securities in the form of GREEN, a cryptocurrency related to a public global decentralized power grid. 

Schiermeyer, the firm's co-founder, also co-founded the mobile gaming firm Zynga. Gala Games has a third co-founder, Michael McCarthy, who formerly served as a creative director at Zynga. 


Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2024 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

About Author

MK Manoylov has been a reporter for The Block since 2020 — joining just before bitcoin surpassed $20,000 for the first time. Since then, MK has written nearly 1,000 articles for the publication, covering any and all crypto news but with a penchant toward NFT, metaverse, web3 gaming, funding, crime, hack and crypto ecosystem stories. MK holds a graduate degree from New York University's Science, Health and Environmental Reporting Program (SHERP) and has also covered health topics for WebMD and Insider. You can follow MK on X @MManoylov and on LinkedIn.

Editor

To contact the editor of this story:
Lawrence Lewitinn at
[email protected]

WHO WE ARE

The Block is a news provider that strives to be the first and final word on digital assets news, research, and data.

+ Follow us on Google News
Connect with the block on