The KAITO token experienced a significant price drop, falling as much as 24% on Friday. This decline occurred after the development team at Kaito announced the termination of their Yaps program. The token has now fallen below a key descending trendline, indicating potential for further losses.
Summary of Key Developments
- •KAITO token price has fallen over 24% in the past 24 hours.
- •The downtrend was initiated after Kaito decided to shut down its Yaps program to comply with recent policy changes implemented by X.
- •KAITO price has broken below a critical trendline support level on the 4-hour chart.
Background and Policy Compliance
On January 15, Yu Hu, founder of the crypto analytics platform Kaito, announced via an X post that the project would be discontinuing its Yaps product and its incentivized leaderboards. This decision was made to ensure compliance with new policy changes at X, which have recently prohibited applications that reward users for content posting.
Hu stated, "After discussions with X, it’s agreed that 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."
The KAITO (KAITO) token saw a sharp decline, falling nearly 21% within the first hour of the announcement. At press time, it was trading at approximately $0.54, marking a roughly 24% decrease from the price point when the news broke.
Hu's announcement followed a notification from Nikita Bier, X's head of product, who indicated that the company had revised its policies to ban applications incentivizing users for posting. Bier cited an increase in AI-generated spam and low-quality content as the primary reasons for this policy revision.
This policy shift specifically targeted Information Finance (InfoFi) platforms like Kaito, which had gamified user engagement through the X API and distributed cryptocurrency rewards based on social interactions.
Crypto investigator ZachXBT noted that the policy change had impacted approximately 157,000 members of the Kaito Yapper community, who faced bans following the crackdown.
The Yaps product from Kaito allowed users to earn Yap points and KAITO tokens for posting tweets related to brands or projects. However, as the user base grew, this led to a notable increase in AI-generated content and automated spam activity within the ecosystem.
Future Platform Developments
Following the discontinuation of Yaps, Kaito plans to introduce Kaito Studio. This new platform is designed to be a more selective, tier-based marketing solution that will extend its reach to other social media channels, including YouTube and TikTok.
KAITO Price Analysis
On the 4-hour chart, the KAITO token has fallen below a crucial descending trendline that had provided support since late December. This breach suggests that bearish momentum may continue to influence the price in the short term.
Technical indicators, including the MACD and the Chaikin Money Flow index, appear to corroborate this bearish outlook. The MACD lines have recently shown a bearish crossover and are trending downwards sharply, indicating increasing sell-side pressure. The Chaikin Money Flow index, which measures the net flow of money into or out of an asset, has also registered a negative reading.
Consequently, it is probable that KAITO's price will continue to decline, potentially reaching its December low of $0.47 before any significant recovery attempt by bulls.
However, if the KAITO price manages to rebound and surpass the psychological level of $0.60, it could signal an end to the current downtrend.