It's not a Wayland problem, the new Steam Overlay works fine for me on Sway. Sorry, not sure why you don't have it, maybe a missing dependency or something? What are you running?
this post was submitted on 21 Jun 2023
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It seems that now it only does not work in one game (as far as i have tested). The game in question is Warframe. So it seems that its truly not a wayland problem.
I personally also use Wayland but my menu works just fine so I have no clue what the problem is sadly