Policy Change Sparks Market Reactions
X, formerly Twitter, has significantly altered its developer API policies, leading to the blocking of applications that reward users for posting content on the platform. This strategic shift is aimed at combating spam and enhancing the overall user experience.
The updated policy, announced by X’s Head of Product, Nikita Bier, explicitly prohibits applications that provide financial incentives to users for their posts. Consequently, several InfoFi (Information Finance) projects experienced substantial drops in their native token values. Kaito's token, for instance, saw a decline of over 20% following the announcement.
X has revoked API access for these affected applications, citing a significant increase in automated spam and the proliferation of low-quality content. This policy revision resulted in a sharp depreciation of token values across the InfoFi sector. Kaito's token fell from approximately $0.70 to $0.56, and other tokens such as COOKIE and LOUD also experienced considerable losses.
Support for Developers Navigating the Transition
In response to the policy changes, X has pledged to offer support to developers whose applications have been impacted. Nikita Bier indicated that affected developers have the option to transition their projects to alternative platforms, including Meta's Threads and Bluesky.
The market's reaction was immediate and pronounced, with InfoFi projects like Kaito and Cookie DAO collectively losing millions in market value. While X's crackdown is intended to foster a cleaner user environment and improve content quality, it has undeniably disrupted the broader InfoFi ecosystem. The total market capitalization of the InfoFi sector reportedly declined by 11.5% as a direct consequence.
X's decision to block InfoFi applications represents a notable shift in its platform management strategy. By actively taking action against projects that financially incentivize user engagement, the company is prioritizing the reduction of spam and the enhancement of content quality for its users.
As of the latest reporting, Kaito (KAITO) is valued at $0.57. In the preceding hour, its price decreased by 3.5%. Over the last 24 hours, it experienced a 20.25% drop, and within the past 7 days, the token has declined by 27.8%.