An internal security issue allegedly led to someone draining the funds
The price of the Gala Games (GALA) token plunged on Monday after a hacker minted and swiped 5 billion tokens utilizing the Gala smart contract. The tokens were valued at about $240 million at the time of the incident, causing the price to fall 20% in under an hour.
The thief sold 600 million tokens through the Uniswap decentralized exchange, worth about $29 million, causing the price to tumble from about $0.048 to $0.038.
Pseudonymous crypto security auditor and contract developer 0xQuit posted on X, “A compromised or rogue Gala Games admin address minted 5 Billion $GALA ($200M) and has been systematically selling the tokens for the past 2 hours.”Â
Gala CEO Eric Schiermeyer posted an update on the Gala Discord server almost two hours after the breach was detected to confirm and explain the crisis and also conveyed the same message on the Gala Games X account.
A compromised or rogue Gala Games admin address minted 5 Billion $GALA ($200M) and has been systematically selling the tokens for the past 2 hours.
This is why decentralization is important – I prefer “can’t be evil” over “don’t be evil”, and design with that in mind.
Outlaw… pic.twitter.com/aZkQZ2zYi6
— Quit (@0xQuit) May 20, 2024
“We identified the compromise and within 45 minutes we secured and removed unauthorized access to the GALA contract,” wrote Schiermeyer. “It’s important to note our ETH contract for $GALA is secure and under the protection of a multi-sig wallet. It was never compromised.”
Gala announced later that the wallet involved in the hack had been “frozen,” resulting in the remaining 4.4 billion tokens being “effectively burned,” meaning they can never be accessed and are considered a loss. Â
“We messed up our internal controls… this shouldn’t have happened and we are taking steps to ensure it doesn’t ever again,” declared Schiermeyer. “We believe we have identified the culprit and we are currently working with the FBI, DOJ, and a network of international authorities.”
Emma Rodriguez is the Proofreader at the Big Blind, with seven years of experience and five years in online gambling. She plays a crucial role in maintaining content quality by ensuring error-free, reader-friendly information about the gambling industry.
