Should You (or Anyone) Buy Gala (GALA)?

Gala Games aims to make blockchain games people want to play.

Gala Games (GALA) is a crypto gaming project that gained over 30,000% in 2021, making it one of the year's best performers. Its mission is to create blockchain games people actually want to play and it already has 14 games in development on its platform, though only one of them is currently playable. Like many cryptocurrencies, Gala has struggled this year and is currently down over 90% on its all-time high, according to CoinGecko data.

GALA basics

Gala Games is a gaming and metaverse token with a difference. It's not focused on one single game or virtual universe, it's a community-led platform that has a number of different games in the works. Here are some basic facts about Gala Games:

• Management team: Eric Schiermeyer, the cofounder CEO of Gala Games brings a lot of experience in the gaming industry as does the project's other cofounder, Michael McCarthy.
• Date launched: September 2020
• Market cap: Almost $460 million (per CoinGecko, June 2022)
• Availability: Many major U.S. cryptocurrency exchanges.

Crypto gaming is an exciting part of the Web3 evolution, as the play-to-earn model offers gamers the possibility of earning rewards for time spent gaming. It also changes the established ideas around ownership in games. With blockchain gaming, or GameFi, in-game assets are often NFTs that can be traded and have value outside the game.

Should you buy?

Let's start with some of the reasons for optimism about Gala. First, it has some strong games in development that may well break the mold when it comes to blockchain games. Up until now, the biggest issue for a number of blockchain games is that they are not as fun to play as ordinary ones. Gala wants to change this. In addition, Gala has an experienced management team and has worked hard to attract industry talent.

There are some big milestones in the pipeline too. The most notable is Gala's plans to move to its own blockchain. It currently runs on the Ethereum (ETH) and Binance Smart Chain ecosystems. Developing its own ecosystem will allow it to significantly reduce costs and improve transaction times.

Recently it also announced a partnership with the Epic Games Store. Epic is a major non-blockchain gaming company, and the deal means an upcoming Wild West game called GRIT will be one of the first Web3 games to be released on the Epic platform.

But it's not all good news. Blockchain gaming is a complicated and highly competitive sector that can be heavily trend-driven. Ultimately, we don't know which platforms will eventually come out on top. Gala's model differs from Axie Infinity (AXS), another play-to-earn gaming platform that came to the fore last year. However, Axie is struggling to maintain its in-game economy because it pays out so many rewards. It's essentially continually watering down the value of the tokens in circulation. Axie has other issues too, but its fall from grace raises questions about the sustainability of other gaming platforms.

One thing to know about Gala is that its token is separate from the gaming tokens players can earn in individual games. In theory, this means that if there are inflation issues, they will be in the specific games rather than across the whole ecosystem. Another issue highlighted by Coin Bureau is a lack of transparency about Gala's tokenomics. A December video pointed out that there isn't a lot of documentation about how the token works.

Bottom line

Gala Games surged last year as crypto gaming came into the spotlight and investors jumped on this new craze. However, as we've seen with other tokens, it is difficult to know how much the price jump was fueled by speculation and how much is a realistic representation of the highs Gala might be able to reclaim in the long term. As with any crypto project, it's important to only invest money you can afford to lose.

We are now in a very different economic climate and crypto markets could struggle for some time to come. If this is the start of a new crypto winter, we can expect a number of weaker projects to fail, which will be a painful process. This makes it all the more important to do your own research and look carefully at each project's long-term prospects. Gala may turn out to be one of the top crypto gaming platforms of the future, it's certainly got a lot going for it. But it's a risky market segment and the project could also fall out of the spotlight.