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GALA price falls sharply thanks to mining of 55 billion tokens

Because billions of GALA tokens were suddenly mined, the price on crypto exchanges like Binance or Huobi dropped by double digits.

By Mike Hesp
• 3 min read
GALA price falls sharply thanks to mining of 55 billion tokens

Because billions of GALA tokens were suddenly mined, the price on crypto exchanges like Binance or Huobi fell by double digits. Arbitrage bots are shamelessly taking advantage of the situation.

Last night an attacker minted 55 billion GALA tokens for free and flooded the decentralized crypto exchange (DEX) PancakeSwap with them. This comes from a View post on X from analytics firm Peckshield.

Gala is an ERC-20 token

Gala Games' cryptocurrency is an ERC-20 token. To make it tradable on the Binance ecosystem (BSC chain), a pGALA BEP-20 token was created.

After the 55 billion tokens were received in $50,000 tranches on the DEX, users bought the cheap pGALA and moved it via BEP-20 to centralized crypto exchanges Binance.com and Huobi.com.

Then arbitrage bots noticed the opportunity and used price differences across various exchanges to sell the cheaply bought pGALA tokens at different prices, pocketing the spread. The result was a sizable sell-off of the GALA ERC-20 token on Binance and especially Huobi. The early movers noticed the sell-off quickly and paused deposits.

Asian crypto exchanges the losers

Because Huobi reacted slowly, the price of GALA on the major Asian crypto exchange corrected by more than 90 percent. Losses of an undisclosed amount have occurred. Still, it’s reasonable to assume total losses across all exchanges could reach up to $1 billion.

The most affected were token holders who hadn’t set a stop-loss and were caught off guard by the sudden sell-off. Huobi has yet to issue a statement. It remains to be seen whether victims will receive compensation.

Because the two central exchanges accepted the pGALA BEP-20 token and misvalued it as a classic GALA ERC-20, the price crash only hit Binance and Huobi.

Exchanges like FTX only list the GALA ERC-20 token, so the price there was less volatile and the price recovered almost completely in the following hours.

This isn’t the first time the Binance Smart Chain has been exploited. Earlier the network faced a bridge hack.

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