Key Takeaways
- They utilized a new GalaChain blocklist protocol feature to freeze 4.4 billion of the 5 billion minted GALA tokens within 45 minutes.
- Gala Games plans to hold a governance vote to decide whether to burn the frozen tokens.
Web3 gaming network Gala Games has recovered about $22 million in Ether after a $240 Million token exploit on May 20. The attacker returned 5913.2 ETH, worth $22.3 million, on May 21, according to an on-chain security firm, PeckShield.
The hack occurred when an unknown attacker exploited Gala Games, minting 5 billion GALA tokens using an admin address. Solidity developer 0xquit noted that the breach could have been carried out by either an external hacker or a rogue address owner. The total value of the stolen tokens was estimated to be around $200 million.
In a blog post on May 21, Gala Games explained that the recovery of the stolen ETH was owing to their swift, effective response and the involvement of federal law enforcement agencies.”The team utilized a new GalaChain blocklist protocol feature to freeze 4.4 billion of the 5 billion minted GALA tokens within 45 minutes.
Gala Games’ co-founder and CEO, Eric Schiermeyer, informed the community on May 20 via X (formerly Twitter) and Discord that the alleged attacker had been identified, including “his home address.” While Gala has not publicly confirmed the identity or method of the exploit, some community members believe it was a security contractor who failed to use a VPN while accessing the wallet.
The hack caused a 20% drop in the price of GALA, the network’s native token. Schiermeyer assured that the Ethereum contract for GALA was not compromised but acknowledged that the protocol’s internal controls had failed. “We believe we have identified the culprit and are working with the FBI, DOJ, and international authorities,” Schiermeyer said.
Despite the recovery, the question remains about what to do with the 4.4 billion frozen GALA tokens. Gala Games plans to hold a governance vote to decide whether to burn these tokens. This would involve upgrading the contract and implementing a fix to remove the illegitimate supply.“We want to assure our community that the minting capabilities of $GALA on GalaChain remain secure and uncompromised,” the firm stated.
DWF Labs announced it had purchased 28 million GALA tokens in the open market to stabilize the token’s value.
Gala Games has faced several exploits in the past few years. In 2021, Gala Games faced a breach that resulted in a loss of $130 million. Last year, Schiermeyer and fellow co-founder Wright Thurston filed lawsuits against each other on behalf of Gala Games.
Thurston claimed Schiermeyer caused Gala to “sell off and wasted millions of dollars in company assets,” while Schiermeyer alleged Thurston stole $130 million worth of GALA.
