Web3 Gaming Industry Collapse: Over 90% of GameFi Projects Fail in Devastating Market Crash

A Caladan analysis reported by CoinDesk shows a near-collapse of the Web3 gaming sector, with over 90% of GameFi projects failing and token prices down about 95% from their peaks. Roughly $15 billion of investment has largely evaporated into marketing, liquidity and failed development, prompting capital to shift toward AI, real-world asset tokenization and Layer‑2 infrastructure. Flagship Axie Infinity saw daily active users plunge (down over 90%) and its token trade far below its $160 ATH, underscoring structural flaws in play‑to‑earn tokenomics. More than 300 blockchain games have shut down, driving investor losses and a broader market reassessment toward projects prioritizing gameplay and sustainable economics.