The GALA blockchain gaming token has recently taken off. However, its tokenomics model raises some concerns.
Over the last week, the price of GALA gaming tokens has more than doubled. Furthermore, GALA is up 18.6% on the day and was briefly up 232% from its low of $0.0154 on December 30.
Gala is a decentralized blockchain gaming ecosystem that claims to have 16,000 player-run nodes all over the world. There was no premine, presale, or early access to the tokens at launch, and no venture firms appeared to be involved.
However, it releases a large number of tokens every day, which may increase selling pressure on the asset and GALA prices.
Gala’s aggressive distribution, according to the UnlocksCalendar Twitter feed, may increase selling pressure. With a daily unlock of around $400,000 or $11 million per month, the recent price increase may be temporary.
Furthermore, the vesting schedule is linear, with daily distributions halving on July 21 every year. The maximum supply of tokens, according to tokenomics, is a hefty 50 billion.
The circulating supply is 7.5 billion out of nearly 39 billion total supply, or 78% of the maximum.
Half of the first GALA token distribution went to Founder’s Node Operators, with the other half going to the Gala Games Conservatorship.
GALA has a market capitalization of $323 million, and the token is currently trading at $0.043. Despite recent gains, the gaming asset is down 95% from its all-time high of $0.824 in November 2021.
Furthermore, the fully diluted valuation (FDV) is currently estimated to be around $2.1 billion. Prices may struggle to gain traction as more tokens enter the market.
A large GALA token mint raised concerns about a potential hack in November. It was, however, a false alarm.
According to an IBT report from January 9, GameFi 2.0 is about to take off. “A new generation of serious play-and-earn developers is moving in, determined to build truly great web3 games,” the company said.
The next driver of momentum will be the decentralization of games and the ability for gamers to participate in the play-to-earn sector. While cryptocurrency markets are currently in a slump, the future of blockchain gaming is bright.
“To put it simply, player-owned assets and thriving token economies are the future of gaming.”
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