X Bans InfoFi Projects, KAITO Plummets 20% — Is This the End?
X’s determination to clamp down on so-called InfoFi purposes has despatched recent shockwaves by way of the crypto market, dragging a number of tokens sharply decrease and forcing a rethink throughout a distinct segment that had grown tightly intertwined with the social media platform.
The instant market response was led by KAITO, the token linked to the Kaito platform, which slid roughly 20% in a single day as traders digested what many noticed as a structural risk somewhat than a short-term coverage tweak.
X Cracks Down on Rewarded Posting, Shaking InfoFi Projects
The shift started with a public assertion from Nikita Bier, X’s head of product, who said the firm was revising its developer API guidelines to dam purposes that reward customers for posting on the platform.
Bier mentioned that these incentives had fueled a surge in low-quality replies, automated posts, and what he described as “AI slop,” degrading the total person expertise.
X confirmed that API entry had already been revoked for affected apps, with Bier including that builders whose accounts had been terminated might search assist transitioning their companies to different platforms corresponding to Threads or Bluesky.
The announcement landed exhausting in crypto circles as a result of many InfoFi initiatives are constructed round harvesting, analyzing, and monetizing X knowledge.
Platforms like Kaito combination posts from giant crypto accounts to establish trending narratives after which reward customers, typically in tokens, for producing content material or engagement. That mannequin left them uncovered to any restriction on API entry or posting incentives.
While X has not declared an outright ban on InfoFi as a class, the sensible impact of chopping off rewarded posting has been to disrupt the core mechanics of a number of initiatives in a single day.
Market knowledge mirrored that shock as KAITO token fell from round $0.70 to about $0.57 inside hours, down roughly 17% to twenty% on the day, whereas buying and selling quantity jumped practically 87% to greater than $121 million, suggesting pressured repositioning somewhat than skinny liquidity.
The token now trades greater than 80% under its all-time high of $2.88.
Cookie DAO’s COOKIE token adopted an identical path, dropping greater than 20% in 24 hours to roughly $0.038, with quantity additionally rising, an indication that holders had been reassessing publicity as uncertainty unfold.
Behind the worth motion lies a deeper debate about whether or not InfoFi’s incentive buildings had been sustainable.
Critics had lengthy argued that paying customers to submit inspired consideration farming and automatic content material, an accusation that gained credibility as timelines crammed with repetitive, AI-generated replies.
Following the announcement, Kaito founder Yu Hu said the firm would sundown its “Yaps” and open incentive leaderboards, changing them with Kaito Studio, a extra selective, tier-based advertising and marketing platform designed to work throughout X, YouTube, TikTok, and different channels.
— Yu Hu
(@Punk9277) January 15, 2026
Hu framed the shift as an alignment with each X’s insurance policies and types’ rising desire for focused campaigns over mass distribution.
Other platforms echoed that reassessment, with Cookie announcing it was shutting down its Snaps creator campaigns after discussions with X, citing the want to guard the integrity of its knowledge merchandise and stay compliant with platform guidelines.
InfoFi is altering, and it’s time to sundown Snaps.
This is our official announcement. pic.twitter.com/fUIzTZpTa8— Cookie DAO
(@cookiedotfun) January 15, 2026
Xeet, one other mission caught in the change, said all campaigns had been paused whereas it evaluated subsequent steps and labored by way of excellent payouts.
In every case, groups pressured that their broader analytics or knowledge companies would proceed, however the rewarded-posting layer was not viable in its earlier type.
The episode has proven how dependent giant elements of crypto’s social layer stay on a single Web2 platform.
X’s use of automated moderation instruments and AI-driven detection has turned it into a robust gatekeeper, able to reshaping whole enterprise fashions with coverage updates.
It has additionally intensified dialogue about alternate options, together with decentralized social networks and multi-platform methods, as builders search to cut back single-point threat.
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