Gala Games Receives $22 Million in ETH from Perpetrator of Security Breach
Blockchain gaming platform Gala Games has retrieved approximately $22 million worth of Ether (ETH) from the individual responsible for a recent “security incident.”
The incident occurred on May 20 when the attacker minted Gala (GALA) tokens worth $200 million and sold a small portion of them before the wallet was frozen.
On Tuesday, the attacker’s wallet returned 5913.2 ETH, equivalent to $22.3 million, to Gala Games.
Gala Games credited the swift recovery to their effective response and the involvement of federal law enforcement agencies, as stated in a blog post published on the same day.
Gala Games employed GalaChain’s blocklist protocol feature, allowing them to freeze 4.4 billion GALA tokens out of the 5 billion minted within a mere 45 minutes.
The measure helped mitigate the impact of the security breach.
Not at my computer so I can’t confirm the address, but it looks like the $GALA exploiter has just returned the ETH they got from the hack! https://t.co/IfnfcQTlqL
— Jason Brink aka BitBender (@BitBenderBrink) May 21, 2024
Gala to Buy Tokens and Burn Them
Although Gala Games has not publicly disclosed the identity or method employed by the attacker, certain community members suggest that Gala had hinted at the involvement of a security contractor who made a mistake by accessing the wallet without using a VPN.
Eric Schiermeyer, co-founder and CEO of Gala Games, shared in a Discord post that the team intends to repurchase the equivalent GALA tokens using the returned ETH and then burn them.
The approach aims to address the aftermath of the incident and ensure the security of the Gala ecosystem.
Furthermore, Gala Games announced the initiation of a governance vote to determine whether the blocklisted 4.4 billion GALA tokens will be considered “burned,” effectively removing them from circulation.
As these developments unfolded, DWF Labs, a technology firm, disclosed its purchase of 28 million GALA tokens from the open market, with the intention of stabilizing the token’s value.
The company emphasized the importance of safeguarding investments and supporting their respective communities.
At the time of writing, GALA is trading at $0.0448, up by 6.64% over the past day.
Gala Games Founders Sue Each Other
The co-founders of Gala Games, Eric Schiermeyer and Wright Thurston, have recently filed lawsuits against one another, accusing each other of misconduct and misappropriation of company assets valued at millions of dollars.
Schiermeyer’s legal complaint claims that Thurston, along with his investment entity True North United, unlawfully acquired $130 million worth of GALA tokens.
Initially, Thurston had purportedly stated that the tokens would be securely held for the benefit of Gala Games.
However, the lawsuit alleges that Thurston and True North engaged in deceptive transactions, including the unauthorized transfer, exchange, or sale of the tokens.
Schiermeyer’s complaint also references a separate lawsuit filed by the Securities and Exchange Commission (SEC) against Thurston and his firm, Green United.
The SEC alleges that they deceived investors through an unauthorized investment offering known as “Green Boxes” or “Green Nodes.”
In a counterclaim, Thurston accuses Schiermeyer of mismanaging Blockchain Game Partners, the registered name for Gala Games.
He alleges that Schiermeyer squandered $600 million of company assets and diverted millions of dollars for personal use.
Both co-founders are seeking to remove each other from their positions as directors of the company.
The post Gala Games Receives $22 Million in ETH from Perpetrator of Security Breach appeared first on Cryptonews.