Popular GameFi and Metaverse coins outperformed the market negatively. Axie Infinity and ApeCoin saw double-digit losses, while STEPN’s GMT token fell 27% on the day.
GameFi coin STEPN price collapsed
Some GameFi and Metaverse coins suffered significant losses on Friday as the broader crypto market slipped. STEPN, a gaming lifestyle app moving to earn, has seen the GMT token drop by 27% in the past 24 hours. GMT is currently down 41% from its peak as it hit an all-time high of $4.11 less than eight days ago.
GMT chart / Source: CoinGecko As reported by cryptokoin.com, STEPN’s GMT has skyrocketed over 3,000% since its launch in early March. It became one of the best performing tokens in months. Despite having previously challenged the bleak macroeconomic outlook that has weighed on the crypto market since the beginning of the year, GMT’s rally seems to have run out.
Metaverse coins that lost the game: AXS and APE
Elsewhere, other game tokens are also feeling the pain. Play-to-earn game Axie Infinity increased its previous losses as the AXS token fell an additional 16% today. The game has been grappling with a dwindling player base for several months, as the amount of money players can earn for playing the game has dropped drastically.
Worse still, Axie Infinity’s Ronin chain-bridge suffered a $550 million hack at the end of March, putting further downward pressure on the AXS token price. Axie Infinity’s flagship token is currently 83% off from its all-time high of $164.90 reached on November 6.
AXS chart / Source: CoinGecko A newcomer to crypto games and the Metaverse scene, ApeCoin is also one of the biggest losers today. The APE, which should join Yuga Labs’ Otherside Metaverse land drop, rose to an all-time high of $26.70 a little over a week ago as NFT collectors stocked up. But demand for APE seems to have dried up after the decline has ended. ApeCoin is down 17.5% in the last 24 hours as crypto market weakness compounded its previous losses.
APE chart / Source: CoinMarketCap Why did GameFi and Metaverse coins drop hard?
Fears of economic recession seem to be behind the sharp decline in stocks and crypto assets yesterday, according to analysts. Analysts think the drop may be related to the Bank of England Monetary Policy Committee’s forecast that inflation will reach 10% by the end of the year. The bank’s Chairman, Andrew Bailey, said the current trend points to a “sharp economic slowdown” that puts the economy at real risk of a recession.
US Federal Reserve continued its plan to increase interest rates to fight inflation by 50 basis points on Wednesday. However, many fear that the previous 25 and 50 point increases will not be enough to curb rising inflation and lead to an increasingly uncertain economic outlook.
According to experts, GameFi and Metaverse coins currently derive most of their value from speculation about what they might achieve in the future, so they are often the first to be cut from investors’ portfolios during dips. It is not yet clear whether today’s drop is a temporary response to recession fears or the start of a longer downtrend in the crypto market.
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