Evaluating only Gala Games’s profile at its peak — without knowing the outcome — the model ranked Unit economics as the #1 likely cause. Documented cause: Fraud.
Key Events Timeline
FOUNDING
Founded by Eric Schiermeyer (Zynga co-founder)
FUNDING
GALA token reaches $7B market cap; NFT gaming boom
PRODUCT LAUNCH
Crypto winter; GALA loses 90%+ from peak
FUNDING
May: Gala sues co-founder Thurston for $600M theft
FUNDING
$130M unauthorized GALA minted and burned; token collapses further
Full Analysis
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Documented cause
Gala Games was a blockchain gaming platform founded by Eric Schiermeyer (co-founder of Zynga) in 2019, building NFT-based games including Town Star and Spider Tanks. It raised over $100 million and GALA token hit a peak market cap of $7 billion in 2021. In May 2023, Gala filed a lawsuit against co-founder Wright Thurston, alleging he had stolen $600 million through unauthorized fund transfers and minting of GALA tokens. Thurston countersued with his own allegations. In the chaos, someone (allegedly an employee using the co-founder's keys) minted approximately $130 million in unauthorized GALA tokens which Gala then burned, causing massive volatility. The co-founder war destroyed user trust, the gaming products never reached mass adoption, and GALA collapsed 90%+ from peak.
Lesson
“Blockchain co-founder disputes create unique risks that traditional corporate governance doesn't face: both parties have token minting authority, and the company's treasury is on-chain where anyone with keys can act unilaterally. A $7B market cap is one co-founder lawsuit away from collapse.”