TL;DR

Gala Games, a major Web3 gaming project, suffered an exploit that resulted in the unauthorized creation and sale of GALA tokens worth over $200 million.
An unknown attacker exploited a vulnerability to sell 600 million tokens through Uniswap, generating a value of $29 million, with the capacity to create up to 12 billion additional tokens.
The company’s CEO, Eric Schiermeyer, took responsibility for the incident and announced collaboration with the FBI and other authorities to find the perpetrator.

Gala Games, one of the leading projects in Web3 gaming, fell victim to an exploit that resulted in the unauthorized creation and sale of billions of GALA tokens, valued at over $200 million.

According to reports, an unknown attacker exploited a vulnerability in the platform to create and sell 600 million tokens through the decentralized exchange Uniswap, generating an estimated value of $29 million at the time of the attack. Additionally, it was revealed that the attacker had the capability to generate up to 12 billion more tokens before reaching the maximum limit.

The security incident involving the $GALA token has been contained and the impacted wallet has been frozen.

This was an isolated incident, the cause of which has been addressed and we are working closely with law enforcement to investigate the individuals behind the breach.…

— Gala Games (@GoGalaGames) May 21, 2024

Gala Games’ response was swift and effective. Within an hour of identifying the incident, the team blocked the compromised address and secured the smart contract to prevent further unauthorized actions. However, despite this prompt intervention, the price of their token experienced a significant drop of 20% on May 21, though it has since stabilized. It is currently trading at $0.041, compared to $0.048 prior to the attack.

Gala Games Collaborates with the FBI and the Department of Justice

Eric Schiermeyer, the CEO of Gala Games, took responsibility for this failure in the company’s internal controls and acknowledged that the situation should not have occurred. Schiermeyer announced that the team is working with the FBI, the Department of Justice, and other international authorities to identify the perpetrator and address the issue appropriately.

In addition to collaborating with authorities, Gala Games is also involving the community in decisions regarding the daily distribution of tokens. They aim to enhance transparency and community participation in the platform’s management.

This incident highlights the importance of implementing robust security controls in DeFi projects and maintaining constant vigilance to protect assets and the integrity of platforms within the blockchain ecosystem.

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Filed under: News - @ May 21, 2024 12:17 pm