China's $6 Billion Crypto Stash + Gala Games Hack

Welcome back, everyone. Workweek may have come to its end, but crypto and web3 have no weekends.

Today's events:

• Gala Games Multi-Million Dollar Hack
• China's Crypto Stash
• NFT Vending Machine
• Answer to Yesterday's Puzzle
• Selected Meme of The Day
• Bite-Sized News

GALA GAMES MULTI-MILLION DOLLAR HACK

Okay, so some nerve-wracking stuff has just happened. At least for those who are or were invested in Gala Games, a blockchain gaming company.

GALA, the digital utility token of the Gala Games ecosystem, temporarily saw its price drop by 25.6%.

Fears of a billion-dollar hack or a rug pull started spreading. Gala games rushed to calm everyone down:

'Lots of people tossing around words like 'hack' and 'rug'. Neither of these is the case,' tweeted the company. So… What happened?

It was spotted that a single blockchain address somehow minted over $1 billion worth of GALA token. Just like that - out of thin air.

Concerns were raised, this event was flagged for closer inspection.

pNetwork, a DeFi routing structure provider, that also caters for Gala Games, responded with… Saying that they themselves organized this suspicious event.

Apparently, they orchestrated a white hat hack attack to avoid any real and evil hackers attacking the system, and minted the tokens to drain a vulnerable PancakeSwap pool.

But. That's not entirely true.

This 'white hat' hacker did not stop there. Because after minting 55 billion $GALA tokens, this hacker immediately sold 10 billion of them on PancakeSwap for $BNB.

After selling it, they earned a total of 12,977 $BNB ($4.4M). The $BNB PancakeSwap pool was drained completely before this hacker could even dump ALL of their freshly-minted goods.

So the 'white hat' hacker… Turned out to be an actual hacker.

Now, arbitrage traders enter the chat.

Arbitrage is when traders buy tokens on one exchange cheaper than on another, transfer the tokens to the exchange where the rate is higher, and sell them there.

So one of these arbitrage traders grabs the moment. Suddenly there's $GALA dropping in value like no tomorrow. And the amount of $GALA available on PancakeSwap just got enormous.

So… this arbitrage maestro casually buys 406.9M $GALA for $120,380.

Transfers it to Binance, and Huobi, two centralized exchanges, and sells all of it.

Ends up with a total profit of $6.5M.

At the end of the day, one random arbitrage trader made a higher profit than the actual hacker who called it a day after having pocketed $4.4M.

Not even mentioning other arbitrage traders who woke up as casual crypto traders, and went to sleep as newly-made crypto millionaires that day.

TL;DR: Blockchain gaming company Gala Games got hacked. Hacker minted and sold $GALA tokens for $4.4M. Arbitrage traders grabbed the opportunity and made even higher profits.

CHINA'S CRYPTO STASH

China has solidified its reputation as one of the most unfriendly countries for digital assets and initiatives related to them. I mean, they banned crypto as such.

But at the same time, the Chinese government controls more BTC than the largest known holder, MicroStrategy, led by Michael Saylor, the loudest Bitcoin maximalist out there.

Smells like a contradiction.

So the news broke after Ki Yong-ju, co-founder and CEO of the analytical agency CryptoQuant, announced this.

According to him, the Chinese government controls 194,000 BTC and 833,000 ETH, as well as other cryptocurrencies totalling about $6 billion.

Okay, so where did China get it from?

Confiscated during PlusToken investigation, a massive-scale anti crypto operation in China.

And by massive-scale we mean that there were more than 4 million people involved in the PlusToken ponzi scheme.

Despite such a huge amount of cryptocurrency, the PRC authorities don't plan to sell their assets, at least not yet.

Ki Yong-ju imagines a possible scenario in which all 194,000 BTC will be "merged" into the market. And this would instantly bring down the BTC rate and "bury" the ecosystem.

TL;DR: China's Treasury holds around $6 billion worth of crypto. It's all been confiscated during crypto crackdowns on illegal crypto firms or ponzi schemes, such as PlusToken.

NFT VENDING MACHINE LANDS IN LONDON

You've read it right.

Dubbed 'Europe's first NFT vending machine', this thing is one of the quirky ways of how NFT.London conference tries grabbing passers-by's attention.

It may sound confusing, but it's engineered in a rather super simple, yet clever way.

The machine accepts contactless payment. And it charges £10.

Once the money is in, the buyer receives an envelope. Inside it, there's a QR code.

Following it, the NFT-enthusiast-in-the-making gets directed to myNFT platform. There they'll find an already set-up wallet with the purchased token stored inside of it.

TL;DR: There's an NFT vending machine in London. It's one of the NFT.London conference's attractions. For £10 people can buy an NFT.

THE ANSWER TO YESTERDAY'S PUZZLE

Congrats to everyone who tried solving yesterday's challenge. Even if you couldn't solve it, your attempt is still worth applauding.

The answer to it was: ETH SOLANA BTC

There will be more puzzles in the future. Don't miss out!

Selected Meme of The Day

Bite-Sized News

• Coinbase Q3 Report Reveals a 44% Drop in Transaction Revenue. You can escape a bear, but you can't escape the bear market.
• Crypto Exchange Kraken Rolls Out NFT Marketplace for Beta Testers. New stuff all over the place.
• Formula 1 Team Has to Join Hands with NFT Marketplace OpenSea. New products arriving at 180 mph.
• Private Conversation Reveals Do Kwon's Involvement in LUNA's Price Manipulation. Elbow deep in the mess.
• Circle Starts Moving Its USDC Reserves to BlackRock Fund. Circle may break out of the vicious circle.