According to CoinMarketCap, the GameFi sector’s market capitalization fell 68% in 2025 to $7.8 billion, highlighting a severe contraction in sector value that is directly relevant to risk exposure and portfolio weighting decisions for traders, source: CoinMarketCap, Jan 5, 2026. According to CoinMarketCap, trading volume declined 69% to $1.3 billion in 2025, indicating materially thinner liquidity conditions that can increase slippage and widen spreads for GameFi tokens, source: CoinMarketCap, Jan 5, 2026. According to CoinMarketCap, average ROI across the sector registered at -75% in 2025 with some tokens down more than 90%, underscoring elevated downside and drawdown risk for momentum and breakout strategies, source: CoinMarketCap, Jan 5, 2026. According to CoinMarketCap, many game studios shut down in 2025 and analysts judge the segment as overvalued and underdelivering, reinforcing a defensive stance and caution on new allocations in GameFi until fundamentals improve, source: CoinMarketCap, Jan 5, 2026.