A $1B crypto hack caused a 20% plunge in the price of GALA, but the firm claims it attacked itself as a safeguard. The blockchain games company posted on Twitter that the price drop was only temporary and prices are beginning to recover. However, many investors remain worried, evidenced by the 12% continued loss in value of GALA over the past day.
Overview of GALA
Gala Games uses blockchain technology to create a play-to-earn gaming platform. This means that users can earn the Gala token for achieving in-game milestones. In addition, players can create and trade non-fungible tokens (NFTs) in-game or on exchanges that are not game based. This year, GALA plans to launch several games and move off the Ethereum blockchain to its own network. These are both positive signs for the project.
What Happened to GALA Games?
An irregular amount of GALA tokens being minted by a single address on PancakeSwap decentralized exchange (DEX) caught the attention of PeckShield, a blockchain security organisation. This caused alarm as it could be an indication of an exploit or rug pull.
The incident was, in actuality, caused by the multi-chain routing protocol pNetwork. This network provides infrastructure support for Gala Games and many other decentralised finance (DeFi) organisations.
The firm noticed that pGALA was no longer safe and decided to coordinate a white hat attack to prevent it from being exploited. They did this by creating new tokens which would help the pNetwork drain a PancakeSwap pool that wasn’t working properly.
Gala Games releases delayed statement
Almost 2 hours after reports of a possible hack started circulating, the President of the company finally addressed user concerns. The company’s lack of communication is likely the biggest reason for the token’s value to drop by almost 30%. Gala Games’ Twitter handle was inactive for nearly four hours, by which time the community had already become outraged.
Will It Recover?
GALA’s long-awaited Spider Tanks game was finally released to the public this month, yet a malfunction has caused the company’s stock prices to plummet. It debuted at $0.38 on 3 November and peaked soon after at just over $0.40. However, what followed was a freefall to a low of $0.28–a 42% drop from its earlier high that day.
The gaming token has managed to regain some of its value. As of 4 November, it was trading at around $0.35, but is still down 12% from the past 24 hours. Hopefully, it will fully recover just within few days.