“Punch” or “Punched” is a term invented by the twitch streamer/tiktoker named nurionbothworlds, the definition is simple, it simply means something or someone is lame or unfunny. Particularly jokes or insults people make back at you.
Similar to "Jump the Shark" or "nuke the fridge", this idiom is used to describe when a videogame has begun its decadence or a period of bad quality. Named after the events in the final level of Resident Evil 5 when Chris Redfield shows impossible levels of human strength when he punches a boulder in a freaking volcano. It's important to mention that these moments aren't guilty of the changing direction (for worse) of a videogame saga but rather a symbol of it.
Oh my gosh, I thought this game was just campy but after the cutscenes it has definitely came to its "Punch the boulder" moment.