January 15, 2026, will remain a dark day in Crypto Twitter’s history. X (formerly Twitter) triggered a shockwave by brutally revoking API access for dozens of crypto projects, causing several tokens to collapse and raising fierce criticism about the arbitrary nature of these sanctions.
A Massive Purge With Devastating Consequences
Nikita Bier, X’s product manager, announced without warning the revocation of API access for all « InfoFi » applications – projects that reward users for their engagement on the platform. The official justification cites a « phenomenal amount of AI-generated spam and automated responses. »
The market impact was immediate and devastating. The KAITO token, the InfoFi sector’s flagship project, collapsed by 23% within minutes, dropping from $0.71 to $0.54. In total, 25.8 million KAITO tokens worth $14.16 million were locked in staking across 17,754 addresses at the time of the announcement, subject to a 7-day withdrawal period – condemning holders to suffer devaluation without being able to react.
Other projects suffered a similar fate: Cookie DAO dropped 18%, while the entire InfoFi sector lost between 13% and 23% of its market cap within hours, bringing the total market value from $470 million down to $359.5 million.
Legitimate Projects Caught in the Storm
The controversy lies in the fact that several sanctioned projects offered far more than a simple rewards system. Kaito, for example, positioned itself as an AI-powered analytics and monitoring platform to identify emerging crypto trends on X. Cookie DAO focused on analytics and decentralized data, while BubbledMaps provided blockchain forensics tools to detect market manipulation.
Yu Hu, founder of Kaito, responded by announcing the end of the « Yaps » system and the launch of « Kaito Studio, » a traditional marketing platform that will extend to YouTube and TikTok, far beyond X’s ecosystem. Cookie DAO also announced the termination of its « Snaps » product and a pivot to « Cookie Pro, » focused on enterprise analytics services.
For these players, the message was clear: despite their real utility and millions invested in X’s enterprise API access, the platform could unilaterally destroy their business model overnight.
The Bot Problem: An Excuse to Target Crypto?
Ki Young Ju, founder of CryptoQuant, delivered the harshest criticism of this decision. According to his data, on January 9, 2026, bots generated 7.75 million crypto posts in a single day – a 1224% increase compared to normal levels. But for Ki Young Ju, the real scandal lies elsewhere.
« X penalizes legitimate crypto content instead of addressing the fundamental bot problem, » he stated. He points to the platform’s inability to distinguish automated accounts from human users, despite its paid verification system which, according to him, « now allows bots to pay to spam while authentic users see their reach reduced. »
A Pattern of Arbitrary Sanctions
X’s recent history reveals a disturbing pattern of mass suspensions without explanation. In June 2025, a wave of bans had already struck many influential crypto accounts, including GMGN’s official accounts, as well as key opinion leaders like Sha Po Lang, Wang Xiaoer, Wizard, and the ElizaOS team.
No official explanation was provided. The platform never clarified the criteria for these suspensions, leaving the community in uncertainty. A similar precedent occurred in 2021, during the NFT boom, when major accounts were suspended without warning.
The Paradox of a Pro-Crypto Yet Anti-Crypto Platform
X’s strategy inconsistency is striking. The day before announcing the InfoFi ban, Nikita Bier unveiled « Smart Cashtags » – a feature enabling precise identification of crypto assets in posts, facilitating trading and discussions on the platform.
X is also developing X Money, an integrated payment system that could include cryptocurrencies like Bitcoin or stablecoins. Elon Musk, X’s owner, presents himself as a crypto supporter, particularly of Dogecoin.
How can these pro-crypto initiatives be reconciled with a policy that systematically penalizes legitimate crypto content creators and destroys entire projects based on engagement around digital assets? This contradiction fuels accusations of arbitrariness and double standards.
Structural Fragility Revealed
The episode highlights a fundamental vulnerability of crypto projects dependent on centralized Web2 infrastructures. Dependence on X’s API constituted a « single point of failure » that founders had underestimated.
A simple policy change from a private platform was enough to destroy hundreds of millions of dollars in market capitalization and call into question entire business models. This fragility contrasts with the crypto ecosystem’s promises of decentralization.
Toward a Crypto Community Migration?
Facing these repeated sanctions and X’s lack of transparency, segments of the crypto community are actively exploring decentralized alternatives. Bluesky, based on the AT protocol, and Mastodon, part of the Fediverse, are gaining traction.
Charles Hoskinson, Cardano’s founder, announced his departure from X in January 2026, a strong signal in a community where social media presence is crucial for project visibility.
Discussion around these alternatives intensifies: data decentralization, multi-jurisdictional hosting, open protocols… All these elements represent an attempt to recreate the crypto interaction ecosystem on foundations more resilient to arbitrary decisions from centralized platforms.
Conclusion: A Brutal Reminder of Centralization Risks
The InfoFi ban affair by X illustrates a fundamental paradox of the crypto ecosystem: projects advocating decentralization and autonomy remain deeply dependent on centralized Web2 infrastructures for their distribution and growth.
The destruction of hundreds of millions of dollars in value through a simple unilateral decision, without dialogue or transition period, reminds us that as long as crypto assets depend on traditional gatekeepers, their resilience will remain illusory.
For Ki Young Ju and many observers, the real scandal isn’t the existence of spam – a solvable technical problem – but X’s deliberate choice to penalize an entire sector rather than invest in sophisticated detection solutions. A choice that, for many, reveals less a concern for quality than a desire for control and marginalization of a community deemed too independent.
