$1B Crypto Hack Fears Spur 20% GALA Plunge, but Firm Implies It Attacked Itself as a Safeguard

"All GALA tokens on Ethereum as well as the underlying bridge collateral are SAFE," an affiliated firm tweeted.

AccessTimeIconNov 3, 2022 at 11:38 p.m. UTC
Updated Apr 9, 2024 at 11:16 p.m. UTC

Chaos ensnared Gala Games late Thursday as fears of a potentially billion-dollar hack – or maybe a rug pull – drove its native GALA token down 20%.

Meanwhile, a firm apparently related to the crypto play-to-earn platform said the platform had actually effectively attacked itself to prevent bad actors from absconding with users' money.

Concerns developed after a single blockchain address appeared to mint over $1 billion worth of GALA token out of thin air. When crypto watchdogs PeckShield flagged that, pNetwork – which provides routing infrastructure for decentralized finance (DeFi) and gaming tokens, including apparently GALA – seemed to imply that it was behind the mint.

"We noticed pGALA wasn’t to be considered safe anymore and coordinated the white hat attack to prevent pGALA from being maliciously exploited," the firm said, suggesting the new tokens were printed as a way to help pNetwork drain a faulty PancakeSwap pool.

"All GALA tokens on Ethereum as well as the underlying bridge collateral are SAFE," pNetwork tweeted, explaining the trouble was due to some kind of "misconfiguration of the p.Network bridge."

Decentralized exchange platforms like PancakeSwap use pools to let users swap between currencies without the use of a middleman. The newly printed pGALA tokens were used to drain pGALA pools of other currencies, pNetwork said.

"For the time being, please consider the existing pancakeswap.finance pool to be invalid," pNetwork tweeted. According to pNetwork, a new, properly configured pool will be launched, containing the same balance as the old one.

"A new pGALA token will be created to replace the old compromised one and airdropped in the coming days to those who had pGALA before the pool was drained," pNetwork said.

In the world of crypto, though, where rug pulls – or project founders stealing everything – are common, that announcement didn't totally settle down fears. Though pNetwork encouraged users to "not initiate swaps to and from this pool," many confused (or skeptical) users bought and sold the soon-to-be-deprecated tokens anyway as its price dropped.


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Krisztian  Sandor

Krisztian Sandor is a reporter on the U.S. markets team focusing on stablecoins and institutional investment. He holds BTC and ETH.

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