TL;DR
- The Web3 gaming market lost 69% of its value year-over-year, dropping to $8.83 billion.
- A brief rally in late November quickly faded, failing to sustain momentum.
- Major players like Animoca Brands are shifting focus toward tokenizing real-world assets.
The Web3 gaming sector faces a steep decline as its market capitalization slips to $8.83 billion, marking a 69% year-over-year loss and 34% decrease in a single month, according to data compiled by CoinMarketCap. The downturn unfolds during a period of persistent low trading volumes, even as companies continue to announce partnerships aimed at revitalizing the sector.
In late November, GameFi tokens briefly rallied, gaining 7% in two weeks and nearing the $10 billion mark. Trading volumes surged 103%, reaching $6.1 billion, raising hopes for renewed momentum. However, the rally faded rapidly. By December 1, market value had fallen back below $9 billion for the first time in over a year, signaling that the bullish sentiment had little follow-through.
The decline reflects a broader crypto winter, where partnership announcements and project launches have failed to convert into measurable on-chain activity or sustained trading interest. Despite being one of the most promoted verticals in blockchain, Web3 gaming continues to struggle for relevance and real-world traction.
Few Winners in a Broadly Negative Market
Only a handful of gaming tokens managed to resist the selloff. Game Company (GMRT) led the gains with a 142% price increase, followed by Echelon Prime (PRIME) up 44.4%, Veracity (VRA) up 25.06%, and VisionGame (VISION) rising 20.45%.
On the downside, My Lovely Planet (MLC) and CateCoin (CATE) posted the sharpest losses, dropping 22% and 20% respectively over the past 24 hours.
At the end of November, GameFi ranked 16th in DeFiLlama’s narrative tracker, a weaker position compared to previous months. The ranking highlights the sector’s reduced influence within decentralized finance narratives, even as DeFi markets overall recorded steady inflows in the second half of 2025.
Partnership Announcements Fail to Reverse Sentiment
Several firms announced new partnerships in November in an effort to reignite investor confidence. On November 27, Pi Network revealed a collaboration with CiDi Games to expand the real-world use of its Pi token. The partnership aims to make Pi a payment option for in-game purchases while enhancing the blockchain’s gaming infrastructure.
That same day, EdgeAI Labs confirmed its alliance with PumpGame (formerly SuiGame) to complete a brand transition and move its platform from the Sui blockchain to BNB Chain (BSC).
Despite these developments, Web3 gaming tokens continue to trend lower. Analysts point out that the gap between industry hype and market adoption remains wide. While companies such as Pi Network, EdgeAI Labs, and Animoca Brands work to expand their presence, the market’s declining liquidity and weak retail participation suggest a deeper structural problem.
Trading sentiment across the GameFi segment is subdued. Engagement on Crypto Twitter has fallen to five-year lows, reflecting how most users interact with gaming tokens as speculative assets rather than through gameplay. The consequence has been the closure of at least 27 studios between January and October 2025.
Animoca Brands Expands into Real-World Asset Tokenization
Amid the downturn, Animoca Brands, a leading Hong Kong-based Web3 firm, has shifted part of its focus toward real-world asset (RWA) tokenization. The company signed a memorandum of understanding with Rayls to identify asset classes and issuers suited for tokenization using Rayls’ infrastructure.
According to the announcement, NUVA, a chain-agnostic vault marketplace, will handle distribution of Rayls-tokenized assets, while Rayls provides the underlying technology, cross-chain bridges, and settlement infrastructure.
Marcos Viriato, CEO of Parfin, Rayls’ core developer, said institutional participation is crucial to ensure stability and reliability within crypto markets.
Meanwhile, Keyvan Peymani, Chief Strategy Officer at Animoca Brands, told CNBC that the company plans to launch a stablecoin and an RWA marketplace in 2026. Earlier, in August, Animoca formed Anchorpoint Financial, a joint venture with Standard Chartered and Hong Kong Telecommunications, to apply for a stablecoin license from Hong Kong regulators.
