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Amid a brutal crypto crash, GameFi tokens like Pixel, Portal, Mavia, and BigTime are down double digits as Bitcoin continues to fall – but what’s going on with the GameFi crypto shakeout?
Hopes of a crypto mega run quickly fade following Bitcoin’s failure to trek higher, breaking all-time highs.
Bears are now (looking at price action) taking over, which means more pain could be on the offing for altcoin and GameFi token holders.
Crypto Crash Leaves GameFi Tokens Massacred
Thus far, the once-booming GameFi sector, which ingeniously fuses gaming and decentralized finance (DeFi), is being ravaged by a brutal sell-off, leaving popular tokens like PIXEL, PORTAL, MAVIA, and BigTime reeling.
As an illustration, the -12% dump of Bitcoin prices in the previous week of trading has disproportionately impacted altcoins, with some experiencing double-digit losses in a single day.
Meme coins are slipping lower with Dogecoin down -27% in the last week of trading while Shiba Inu dropping by -22% in the same period.
The effect on GameFi is even more pronounced considering its relatively lower market cap than meme coins.
According to CoinGecko, GameFi tokens have a market cap of over $19.3 billion and registered an average trading volume of around $1.5 billion in the past 24 hours.
Looking at CoinGecko data, the total market cap of GameFi tokens is down roughly -2% on the last trading day. However, like Bitcoin, even top GameFi tokens like GALA and Immutable are down, on average, -28% in the previous week.
The drawdown on other low market cap tokens in the same category is even worse.
PIXEL, the token powering the popular metaverse game Cryptovoxel, is down a staggering -44% in the last week.
It was changing hands at $0.39 at press time with a market cap of around $305m.
At the same time, PORTAL, the utility token for the sci-fi RPG game, has suffered similar losses, however, the impact is slightly more damped, dropping only -38% in the past week, forcing its market cap to $157m.
MAVIA, the governance token of the play-to-earn (P2E) racing game Metaverses Alpha, and BigTime, the token used in the Big Time travel adventure game, have not been spared either.
In the same period, they are down an average of -43% in the last week of trading, slashing their market caps to $82m and $144m, respectively.
The Bottom Line: Will The Bitcoin And Altcoin Sell Off Continue?
It is not clear how long the bear run will last. However, a confluence of factors is contributing to the current GameFi crash. For one, the broader market correction has undoubtedly played a role, with investors fleeing riskier assets.
Unlike Bitcoin—which is the OG and “safe”—top altcoins are considered risky in an investment class classified as risky. At this level, GameFi tokens are down the rankings of “safe” assets and are being dumped.
At the same time, concerns about the long-term sustainability of some P2E models, coupled with a lack of innovation in the genre, have also dampened enthusiasm. Interest is now shifting to artificial intelligence (AI) and other emerging sectors like VR and AR (check out the top VR presale).
Even so, some experts remain optimistic about the future of GameFi crypto. Researchers project the global gaming industry will be worth over $650 billion by 2030. Accordingly, GameFi projects will likely benefit from this trend in the coming years.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital
