TL;DR
- X has banned apps that reward users for posting content, targeting so-called "InfoFi" platforms
- The decision led to the shutdown of Kaito's Yaps and Cookie DAO's Snaps products
- Both KAITO and COOKIE tokens dropped sharply after the announcement
- X says the move is aimed at reducing AI-generated spam and low-quality replies
- Affected developers are being encouraged to move to other social platforms
On Thursday, X announced a policy change that directly targets platforms paying users to post content, a model widely referred to as "InfoFi." The move immediately affected AI-powered crypto projects like Kaito.ai and Cookie DAO, both of which relied on incentive-driven engagement systems tied closely to X's ecosystem.
The decision came straight from X's product leadership. And it wasn't subtle.
Bier followed up with a second post that made the consequences clear.
Within hours, the fallout reached both the product and token level.
Why X Drew the Line on "InfoFi"
Over the past year, X has become ground zero for crypto discussion. Alongside genuine research and debate, the platform also saw a flood of short, repetitive replies and engagement-farming posts. Much of it was tied to reward systems that paid users for activity rather than insight.
InfoFi platforms leaned into this model by offering points, tokens, or future airdrops for posting, replying, and boosting visibility. In theory, this created decentralized research and discovery. In practice, it often encouraged quantity over quality. As Bier framed it, the problem wasn't crypto itself, but how incentives were shaping behavior.
X's updated developer stance removes API access from apps that financially reward posting activity. Without that access, these platforms can't track engagement, verify posts, or distribute rewards tied to X activity. The policy update was reinforced in X's developer notice:
The same notice also offered a path forward for affected builders.
Kaito Sunsets Yaps as Token Takes a Hit
Kaito was one of the most visible projects affected by the change. Within an hour of Bier's post, Kaito confirmed it would sunset Yaps, its reward system that incentivized users to post and engage with crypto content on X. The announcement landed fast, and the market reacted just as quickly.
Yaps had become central to Kaito's growth strategy. Users earned points and potential rewards by posting insights, summaries, and replies, often tied to trending crypto topics. Over time, many participants turned to AI tools to keep up with posting volume. Once Yaps was removed from the equation, uncertainty followed.
According to CoinGecko market data, KAITO fell 14.4% shortly after the announcement. The price move reflected more than just the loss of a feature. For many holders, Yaps represented a direct link between social engagement and token value. When that link was cut, expectations reset fast.
Cookie DAO Follows With Snaps Shutdown
Cookie DAO wasn't far behind. The project confirmed that its own incentive system, Snaps, would also be wound down. Like Yaps, Snaps rewarded users for posting and engaging on X, tying visibility and participation to token-based incentives.
Cookie DAO's announcement was direct.
The market response mirrored Kaito's experience. CoinGecko data shows COOKIE dropped 16.9%, reflecting concern around how the project would drive engagement and growth without X-based incentives. For both projects, the timing mattered. These reward systems weren't side experiments. They were core distribution channels.
Tokens React as Incentives Disappear
Market reaction was swift and unforgiving. CoinGecko's snapshot following the announcements showed both tokens moving sharply lower.
- $KAITO down 14.4%
- $COOKIE down 16.9%
The declines highlight a broader reality in crypto markets. When token demand is closely tied to user incentives, any disruption to that loop can ripple through price expectations. This doesn't mean the projects are finished. But it does mean their models are being stress-tested in real time.
What Comes Next
X says it will support developers looking to migrate to other platforms like Threads and Bluesky. Whether crypto audiences follow remains an open question.
For now, projects like Kaito and Cookie DAO face a transition phase. They'll need to rethink how users discover content, contribute insights, and stay engaged without direct posting rewards. Some may pivot toward on-platform research tools. Others may explore gated communities, dashboards, or off-social distribution entirely. What's clear is that the era of paid posting on X is over.