Crystal growth often proceeds by atomic step flow. When the surface area available for growth is limited, the nucleation and progression of the steps can be affected. This issue is particularly relevant to the formation of nanocrystals. We examine the case of Au-catalyzed GaAs nanowires which we grow in a transmission electron microscope. Our in situ observations show that atomic layers nucleate at the periphery of the interface between the nanowire and the catalyst droplet. From this starting location, the atomic step flows within a restricted area of hexagonal shape. At specific partial coverages, the monolayer configuration changes abruptly. A simple model based on the geometry of the system and its edge energies explains these observations. In particular, we observe an inversion of the step curvature which reveals that the effective energy per unit length of monolayer edge is much lower at the interface periphery than inside the catalyst droplet.