Key Developments Following X's Policy Change
X, formerly known as Twitter, implemented a significant update to its API policy on January 15, 2026. This change directly impacts the InfoFi (Information Finance) sector by prohibiting InfoFi rewards and has led to a notable decline in the Kaito token.
The platform's strategic shift aims to enhance the overall quality of its content and user experience. This move has created immediate repercussions within the InfoFi sector and the broader cryptocurrency market.
Impact on Kaito Token and Platform Pivot
Under the leadership of Nikita Bier, X has prohibited InfoFi applications from incentivizing user posts, a decision that became effective on January 15, 2026. Consequently, these applications have had their API access revoked. Kaito's token, KAITO, experienced a substantial drop of 14-20%, falling from approximately $0.70 to a range of $0.56-$0.57.
In response to these changes, Kaito has announced a strategic pivot towards Kaito Studio, moving away from its previous permissionless distribution model. Stakeholders within Kaito emphasized this transition towards a tier-based marketing platform, designed to align with X's updated policies. A representative for Kaito stated, "A fully permissionless distribution system is no longer viable, nor aligned with the needs of high-quality brands, serious content creators, or X as a platform."
Broader Effects on the InfoFi Market
The InfoFi market as a whole witnessed a significant decline following X's announcement. COOKIE tokens, for instance, dropped 13% to $0.038. The overall market capitalization for the InfoFi sector decreased by over 11%, falling to $367 million. Notably, major cryptocurrencies such as Ethereum (ETH) and Bitcoin (BTC) remained largely unaffected by this specific policy change.
Future Implications and Regulatory Scrutiny
This policy shift by X could lead to a reduction in investments within InfoFi applications as market participants re-evaluate their strategies and presence within X's ecosystem. Regulators are reportedly monitoring the situation closely, although no official statements have been released to date. The loss of a crucial platform for user engagement through reward-based models compels entities in the InfoFi space to reconsider their operational frameworks.