The social platform X, led by Elon Musk, has launched a direct offensive against applications that monetize user attention using digital assets. Nikita Bier, the company’s head of product, announced this Thursday the InfoFi projects restriction on X to clean the network of junk content.
According to the executive, these platforms incentivize “reply spam” and the saturation of automated posts. Therefore, the company has revoked its API access immediately. In this way, they seek to improve the browsing experience for all users.
The announcement caused an immediate negative impact on the information finance sector. Kaito’s native token, one of the most affected projects, suffered a sudden 15 percent drop after the news. Likewise, other digital assets linked to the sector recorded double-digit losses in a few minutes.
On the other hand, X’s management made it clear that they will not accept payments for enterprise access if the business model damages content quality. Therefore, the technical team is reviewing all developer policies at this time.
The move comes after months of criticism regarding the decline of organic interaction on the social network. Nikita Bier argued that the crypto community was hurting its own reach through repetitive and low-quality practices. In this context, artificial intelligence technology was used to farm attention and financial rewards artificially. However, X continues to develop legitimate financial tools for its global users. Recently, the platform introduced “Smart Cashtags” to link stock tickers with real-time data.
Financial impact and exit of incentive apps from the X platform
On the other hand, the decision has been celebrated by security researchers who reported inflated metrics. Projects such as Cookie DAO and Loud also saw their valuations plummet due to the lack of connectivity with the network. In this way, the viability of these applications is seriously compromised without data access. Likewise, Bier sarcastically offered help to affected developers to migrate their services to direct competition. Therefore, the break between X and these projects seems to be definitive and without return.
Kaito confirmed it will sunset its tokenized scoring feature because it does not align with the needs of serious brands. This decision was made after having direct conversations with the social network’s managers. Therefore, the business model based on rewards for posting will face major legal and technical challenges. In this way, X seeks to prioritize content created by humans and high-value creators. However, some analysts wonder if this measure will affect the total volume of monthly interactions.
How will this block affect the digital content creator economy?
Likewise, the importance of this change lies in protecting the algorithm against external manipulation. Many users believe the platform had become difficult to use due to the excess of bots. So the elimination of direct financial incentives should drastically reduce spam. In addition, the company wants creators to focus on real dialogues and not on the generation of artificial hype. For this reason, Musk’s focus is on the authenticity of the network.
Finally, the cryptocurrency market is watching the technology company’s next steps closely. Although the InfoFi projects restriction on X has hit specific prices, the long-term vision is to clean up the ecosystem. The quality of publications in the financial sector is expected to improve substantially in the coming weeks. Therefore, investors will have to look for alternative platforms for this type of monetization dynamics. Likewise, the future of decentralized applications on social networks enters a phase of uncertainty.
