Kaito's Comeback? Can InfoFi Lead the Market Again?

If there is one narrative that defined the crypto market in 2025, it would undoubtedly be InfoFi. Short for Information Finance, InfoFi is a model that rewards people economically for producing and sharing high-quality information. Of course, the idea of compensating users for creating content is nothing new. Ever since the emergence of blockchain, the industry has continuously experimented with various incentive models built around information and content.

One of the earliest and most well-known examples was Steemit, created by Dan Larimer. More recently, Kaito, which dominated Crypto Twitter throughout last year, followed the same lineage. Yet despite their different approaches, both projects are ultimately regarded as unsuccessful experiments for their own respective reasons.

For Kaito, the decisive blow came when X (formerly Twitter) revoked API access for InfoFi-related projects. By that point, the sustainability of the model had already come under increasing scrutiny. Once access to its core data source was cut off, confidence in the project quickly evaporated, effectively bringing the first chapter of Kaito's InfoFi experiment to an end.

source: Kaito’s X

Yet just yesterday, on July 23, sentiment shifted after news broke that Kaito had entered into a new data partnership with X. The announcement immediately revived speculation that InfoFi might be making a comeback, and the Crypto Twitter community has once again become visibly excited. Can InfoFi and Kaito truly return?

1. Was X Really the Reason Kaito Failed?

Kaito’s InfoFi model effectively collapsed after X cut off API access, but doubts about the model’s sustainability had already been mounting well before that point. There were several reasons for this.

First, the overall quality of the projects working with Kaito had gradually deteriorated. In the early stages, a number of relatively promising projects participated. Over time, however, more low-quality projects began using InfoFi primarily as a marketing channel, which in turn weakened trust in the broader ecosystem.

Second, the original purpose of Yapping, rewarding users for producing high-quality information , became increasingly distorted. In pursuit of rewards, users began mass-producing low-quality content with the help of AI, creating fatigue among existing users of X. This eventually led people to ask a more fundamental question: what exactly qualifies as “high-quality information”? As a result, criticism shifted from individual content to the structure itself, which appeared to reward participation and visibility more than the actual value of the information being produced.

In my view, X’s decision to cut off API access merely delivered the final blow to an InfoFi model that was already losing its clarity and relevance. Even without the API ban, its value would likely have continued to decline.

2. InfoFi in a Bull Market Versus InfoFi in a Bear Market

Another major reason Kaito was able to grow was that the crypto market itself was relatively strong in 2025. For an InfoFi ecosystem to function, there must be enough projects willing and able to allocate meaningful marketing budgets to platforms like Kaito.

But as many market participants have experienced firsthand, the crypto market in 2026 has deteriorated so sharply compared with 2025 that it is difficult to believe such a dramatic shift could happen in just one year. Large and small projects alike are carrying out significant layoffs, while even the foundations that remain operational are cutting marketing budgets first. In this environment, very few foundations are likely to commit hundreds of millions of won to Kaito. Many may struggle to justify even tens of millions.

It is therefore difficult to expect the same Kaito that many users remember fondly from 2025, when rewards were abundant. The financial condition of the projects and foundations that effectively bankrolled the Kaito ecosystem has changed far too much. In a market where everyone is focused on survival, Yapping is no longer an essential investment. It is closer to a luxury expense that can be cut immediately.

The Kaito team is, of course, likely well aware of this reality. If it chooses to revive InfoFi, it will have no choice but to design a different incentive structure and a more sustainable business model. Otherwise, it risks repeating the same failure in an even faster and more extreme form. For example, the platform may be forced to onboard well-funded but questionable projects, or the reward pools may become too small to support effective Yapping campaigns at all.

3. Why There May Still Be Reasons for Optimism

First, the fact that Kaito has entered into an agreement with X does not necessarily mean that InfoFi itself is returning. X has repeatedly expressed a negative view of the noise created by InfoFi and has also made clear that it intends to take a strict stance against AI-generated spam and mass-produced content more broadly. Under those conditions, it seems unlikely that X would allow InfoFi to return in the same form as before.

Kaito, too, must have learned a great deal from operating InfoFi over the past year. It has seen firsthand how easily incentives can distort human behavior, and how effortlessly information can be produced at scale and rendered meaningless in the age of AI. After going through those failures, it is difficult to imagine the team relaunching the exact same model.

So far, I have focused mainly on the limitations and failures of InfoFi. That does not mean its achievements should be dismissed.

InfoFi encouraged more people to take an interest in blockchain and crypto. Even if that interest was driven by financial incentives rather than genuine curiosity, it still brought new participants into the market. It also succeeded, at least to some extent, in decentralizing a marketing landscape that had previously been dominated by a small number of KOLs. Most importantly, it demonstrated in practice that attention can be converted into economic value.

From that perspective, the new partnership between Kaito and X may represent more than the restoration of API access. It could become an opportunity to build a new version of InfoFi that addresses many of the flaws and mistakes of the previous model.

If Kaito can create a system in which meaningful rewards flow to people who produce genuinely valuable content rather than AI slop, it could evolve from a platform that generates noise into one that organically cultivates high-quality opinion leaders.

It is also notable that Kaito has recently expanded its coverage beyond crypto and into equities. If the scope of InfoFi can be extended from crypto to financial markets more broadly and eventually into a wider range of industries, it may be capable of creating far greater value than before.

We are now firmly in the era of new media. People no longer rely solely on legacy media to consume information. A new standard is emerging in which individuals produce information, other individuals consume it, and trust and influence accumulate around those relationships.

Can Kaito become the defining incentive layer of this new media era?

There are still many issues that need to be addressed. But if Kaito can fundamentally redesign the model based on the lessons of its previous failure, it may have the potential to become more than a simple “post-to-earn” platform. It could evolve into foundational infrastructure for a new information economy.