While the community worried that a hack or rugpull was the cause for a 90% price drop, Gala Games assured the public that “neither of these is the case.”
As a matter of fact, Gala Games was not hacked. Instead, the drop in price started when PeckShield, a Blockchain security firm, noticed around $1 billion GALA minted by a single wallet. They alerted Gala Games via Twitter that the problem came from a “misconfiguration” with pNetwork, a platform that allows cross-chain operability.
Essentially, Gala Games partners with Polygon to use the pNetwork. Ideally, the deal allows users to trade their assets with low gas fees. However, the bridge became faulty, making a lot of coins at once. Some feared that Gala Games was hacked, but in fact they were not. pNetwork responded, saying that “pGALA wasn’t to be considered safe anymore.” Then pNetwork led a white hat hack to prevent pGALA from becoming “maliciously exploited.”
Jason Brink, Gala Game’s President for Blockchain, told users “Everything is fine. The activity you have been seeing on @PancakeSwap is pNetwork working to drain the liquidity pool.”
Accordingly, the white hat hack happened to protect user assets. As stated by the pNetwork, it is necessary to redeploy pGALA. For this reason, pNetwork drained the pool of pGALA on PancakeSwap. Therefore, users should not buy or sell on PancakeSwap for the time being. According to pNetwork, “Funds are safe but users should NOT transfer or buy/sell pGALA on pancakeswap.”
Jason Brink of Gala Games echoed the same sentiment when he Tweeted, “Do not buy $pGALA on PancakeSwap for now.”
In temporary measures, moderators suspended the GALA bridge. While redemptions are not being processed and users may not transact, GALA has informed the community that funds are safe.
Not to mention, pNetwork will be airdropping an uncompromised GALA token to users in the next few days to replace the previous one. This, according to pNetwork will arrive “in the coming days to those who had pGALA before the pool was drained.” As such, GALA has advised users not to transact with pGALA until they have new tokens in hand.
Why Did Huobi Delist?
To begin with, Huobi detected a large influx of tokens being exchanged. This was early on in the event, later dubbed a misconfiguration. Because of the sudden uptick and fear of Gala Games being hacked, prices of GALA dropped by as much as 90%. Huobi delisted GALA soon after.
The Official Response
Gala Games wants everyone to know that this was not a hack. For now, players are advised not to buy GALA with PancakeSwap and to wait for the airdrop of new pGALA tokens. Administrators suspended the pNetwork bridge until further notice.