Gala Games' native token, GALA, stumbled after the blockchain-based gaming platform Gala Games deleted a tweet announcing a partnership with A-list Hollywood stars.
Monday's tweet that the company was working with Dwayne "The Rock" Johnson and Mark Wahlberg helped lift GALA over 70% to about 5 U.S. cents, the highest since Sept. 13, CoinDesk data show. Gala Games deleted the tweet without any explanation, and the token is now more than 20% lower at nearly 4 cents.
"We are, as you’re reading this, developing two films with the Rock (aka Dwayne Johnson) and Mark Wahlberg! Two absolutely huge forces in the entertainment industry. You’ve seen their work on screen, but I think their presence might be even more powerful off the screen and we are so happy to get the chance to work with them," the now-deleted tweet said, according to an image posted on Discord.
The tweet added that, under the partnership, users within the Gala ecosystem would be able to scan a QR code to buy movie tickets for The Rock's movies and win digital prizes on Netflix.
CoinDesk reached out to Gala Games, and a representative responded several hours later by email noting that Gala's CEO had recently shared news about plans the company has for the coming year, including moving into mobile gaming.
"The narrative around the increase in Gala token being linked to the 'announcement' of the Hollywood names is false," according to the representative.
The representative added that "both The Rock’s company, Seven Bucks, and Mark’s company, Unrealistic Ideas, have contracts for films with Gala."
"The announcement post was meant to be a closed post for the Discord community and wasn't supposed to be shared in a public place," according to the Gala representative. "It was also part of a larger conversation in Discord about where Gala Film was headed. Gala took the tweet down out of respect to all involved partners but we look forward to sharing more about these projects in the near future."
The matter nevertheless quickly drew the attention of crypto enthusiasts on Twitter, with several handles questioning the genuineness of the initial announcement. They called for shorting, or taking investment positions that bet on a decline in, the cryptocurrency.
The funding rates in the perpetual futures market tied to the GALA token were profoundly negative early Wednesday, indicating a bearish bias in the market.
Paid every eight hours, funding rates refer to the cost of holding bullish long or bearish short positions. A negative figure implies shorts are paying longs to keep the position open and the leverage is skewed on the bearish side.
"Gala’s [perpetual] funding rate trades deeply negative, a sign that some traders expect prices to resume lower in the near future. If not, then we could see a lot of short covering as perp open interest has exploded," Markus Thielen, head of research and strategy at Matrixport, said.
GALA still leads the rally in gaming tokens
Despite the pullback, GALA is still up over 130% for the month, leading the rally among gaming tokens.
Ethereum-based virtual reality gaming platform The Sandbox's SAND has risen in value by 30%, while Decentraland's MANA has gained 22%. Other notable gaming coins with double-digit gains are play-to-earn giant Axie Inifinity's AXS token, Yield Guild Games' YGG and Illuvium's ILV tokens.
GALA's performance is noteworthy, considering its triple-digit rally outshines the 80% surge in LDO, the governance token of liquid staking giant Lido Finance. LDO topped the list of best-performing cryptocurrencies with a market value above $1 billion. Market leaders bitcoin and ether have chalked up a meager 5% and 11% gains.
The uptick in gaming tokens, a high-risk subsector that took center stage during the tail end of the 2021 bull market, perhaps indicates a risk revival in the crypto market.
UPDATE (Jan. 12, 3:56 UTC): Adds response from Gala representative.
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