One of the best ways to take control of @Bubblemaps and improve your level is to study cases already resolved by the Bubblemaps team or by renowned on-chain investigators like ZachXBT on X and other similar investigators. In this article, we will study one of the critical situation cases resolved – or rather clarified, I would say – by the Bubblemaps team: the Gala scandal.
Advice: If you haven't done so yet, I recommend reading my previous article on how to start a crypto investigation with @Bubblemaps.io – [link].
Context
Gala Games is a Web3 gaming project founded in 2018 in the United States by Eric Schiermeyer and Wright Thurston. The project quickly made a name for itself in the blockchain gaming ecosystem and is considered a safe bet by many investors. The company offers a gaming platform based on NFTs, uses its native token $GALA for in-game transactions, and also provides licenses to validators. At the time, it had a market capitalization above 350 million dollars, so a project that was doing quite well.
Everything was fine on the community side when suddenly, in September 2023, we learned that the founders are in a lawsuit. In fact, on August 31, 2023, the two co-founders sued each other in a Utah district court. Even then, it's strange!
As there is a trial, the court documents have been made public, and there are more than 200 pages of lawsuits detailing the respective accusations of both parties.
Complaint 1
First, Schiermeyer sues his partner, accusing him of multiple charges. On behalf of Gala, Schiermeyer – also CEO of the company – alleges that in early 2021, Thurston and his investment firm, True North United Investments, misappropriated over 8.6 billion $GALA, approximately 130 million dollars at the time.
According to Schiermeyer's complaint, these tokens $GALA were moved to a wallet under the company's control but were then transferred to other wallets by Thurston, who, when confronted about the movements, stated that he held the tokens in secure wallets for Gala Games, but the subsequent remark is that he moved the tokens from the wallets and exchanged or sold them in a 'complex web of obscured transactions' (to cover the traces) between September 2022 and May 2023, according to the lawsuit.
The lawsuit claims that Thurston later pretended not to be aware of the alleged token sales but now claims that the GALA sold belonged to him – a claim that Schiermeyer's complaint rejects.
Schiermeyer's complaint continues, accusing Thurston of illegally obtaining licenses to operate 'nodes' in the Gala ecosystem. 'These nodes can be exploited to earn valuable GALA tokens,' the document states, adding that Thurston allegedly used company funds for personal investments, including in other fraudulent crypto projects (like Green United, for which he was sued by the SEC in March 2023 for fraud).
Schiermeyer mentions a 'pattern of deception' and requests Thurston's removal from the board of directors, the return of stolen assets, and damages. Schiermeyer also requested a temporary restraining order (TRO) to prevent Thurston from liquidating the remaining tokens, but this was denied by Judge Howard C. Nielson Jr. in October 2023, due to the two-and-a-half-year delay before the complaint and the lack of evidence of imminent irreparable harm.
Complaint 2
On the same day, Thurston, through his group 'True North,' filed a lawsuit against Schiermeyer – also on behalf of Gala – claiming that this co-founder had led Gala to 'sell and waste millions of dollars of company assets' and that he had lent himself millions of dollars of Gala for personal purchases.
Schiermeyer also allegedly created Gala entities in Switzerland and Dubai and made himself the majority shareholder to seize business opportunities, according to the lawsuit.
True North claims that Schiermeyer managed Gala without Thurston's approval – a director of Gala – and provided incomplete or incorrect information and company records to Thurston 'despite repeated requests.'
In his complaint, Schiermeyer requests that Thurston be removed from his role as director of Gala and seeks various reparations and damages, including the return of the allegedly stolen GALA. Thurston has also requested that Schiermeyer be removed from his position within Gala and has claimed at least 750 million dollars in damages and reparations.
The court document of over 200 pages published about the subject, although not made public in its entirety but based on parts relayed by the media, can be summarized into these few essential points of the case.
In 2025, no public final resolution is known, according to my online research; the case appears to still be ongoing or settled amicably without announcement.
Bubblemaps
With such a volume of court documents, no one could follow the thread in the ecosystem, but thanks to Nicolas Vaiman and his team, we realize that these hundreds of court documents can be summarized into a single bubble map (#Bubblemaps ), which we will now see in the following description.
Here is the bubble map (Bubblemaps) of Gala in September 2023:
The lawsuits claim that Gala Games transferred 20 billion of its tokens to 100 company wallets for security reasons. The two co-founders had full access to these wallets, and there was no multi-signature system in place. Therefore, each co-founder had the private key to each wallet. (Note: in the context of cryptocurrencies, a multi-signature wallet is a digital wallet that requires multiple signatures or approvals to authorize a transaction, thus providing enhanced security.)
What happened is that initially, Gala held 80% of the supply in a single wallet, the wallet in the middle at the center of the cluster; then, as a security measure, the team decided to split this 80% into 100 other wallets to which both co-founders have access: the wallets circled in yellow in the screenshot – except for the one in the center of the cluster which represents the origin. These wallets are dotted because, at the time of the screenshot, they are empty.
You can check the transaction history of the wallets or the state of the bubble maps at earlier dates for more details.
Schiermeyer accuses Thurston of transferring, on February 3, 2021, 8.6 billion GALA tokens from 43 of these company wallets (A) to his own wallets (red wallets – B).
On the other hand, Thurston accuses Schiermeyer of similar actions by transferring 11.3 billion GALA tokens to his own wallets. That is, after noticing Thurston's actions, Schiermeyer transferred tokens from the remaining other wallets to his wallets.
At this level, we observe that the co-founders no longer trust each other; therefore, each of them transferred part of the 80% of the GALA supply to wallets they control. In total, these two individuals held 78% of the V1 tokens. Can we still talk about decentralization?!
What happened next is that at the beginning of 2023, before the trial – so we didn't know it was going badly – Gala announced a GALA V2 migration. This is surprising because everything was fine, and there was no reason to migrate the token to a version 2. But apparently, given the course of the story, we realize that it was one of the founders, namely Schiermeyer, who launched version 2 behind the other's back without airdropping the new token to him – that is, without exchanging the old tokens for the new ones; as revenge so that the old tokens held by the other would become digital stones, meaning worthless.
The two founders backstabbed each other in a stratospheric and incredible manner.
Conclusion
At this moment, imagine individual holders who hold these tokens as cherished cryptos in their wallets. It is important to know what is happening on-chain (the decentralized network), as it allows us to verify the authenticity of project creators. And this story with GALA reminds us not only of the importance of often checking the bubble maps of crypto projects, but also highlights the storytelling power of bubble maps: the ability of bubble maps and clusters to tell stories.
Note: $BMT is the crypto of the Bubblemaps project with multiple utilities.
