KAITO Short-Term Price Drops Over 13%, Currently Trading at $0.595

Kaito's native token, KAITO, has seen a sharp decline following X's policy revisions. The token dropped more than 13% in short-term trading, reaching $0.595 at the time of publication. This drop follows a policy update from X, formerly known as Twitter, which revoked API access for apps that incentivize users to post on the platform.

X's product lead, Nikita Bier, emphasized the need for this change to address 'tremendous amount of AI slop & reply spam' on the platform. The move aims to improve user experience by curbing spam and bot activity. The Kaito platform, which aggregates content from prominent crypto accounts on X, has been a target of these policy changes.

Kaito's token is now trading at $0.595, down 14.5% according to The Block's price data. This follows a significant peak in February 2025 when the token's fully diluted valuation reached $2 billion. The current market cap of KAITO is around $140 million, with a fully diluted valuation of $586 million.

Why Did This Happen?

X's revised API policies directly affect Kaito's operations. The platform relies on user-generated content to aggregate trends and topics within the crypto community. With the new policy, Kaito's ability to incentivize user contributions has been curtailed. This change is expected to reduce the volume of spam and AI-generated content, but it also impacts the platform's growth strategy.

The immediate market reaction to X's announcement was significant. KAITO's price dropped over 10% following Bier's post. This decline reflects investor concerns about the platform's future viability and growth potential.

How Did Markets React?

The broader cryptocurrency market also experienced volatility in response to the policy change. Bitcoin (BTC) and other major cryptocurrencies saw declines, with Bitcoin dropping below $96,000 at press time. This market reaction indicates a broader sensitivity to regulatory and policy shifts.

Altcoins such as Ethereum (ETH), Ripple (XRP), and Solana (SOL) also declined, with some dropping as much as 4%. The overall market sentiment turned bearish, with long liquidations outpacing short liquidations.

What Are Analysts Watching Next?

Analysts are closely monitoring how Kaito will adapt to these new constraints. The company has not yet announced any significant changes to its business model or strategy. The focus is on how the platform will continue to aggregate and present user-generated content without the incentive structure.

Market observers are also watching the broader implications of X's policy shift. The move is part of a larger trend among social media platforms to address spam and bot activity. This trend could have long-term effects on the 'infofi' sector, which relies heavily on user engagement and content generation.

The technical analysis of KAITO's price suggests a bearish outlook in the short term. The RSI is at 61.14, indicating a neutral position. However, the Moving Average Convergence Divergence (MACD) and other indicators show a weakening bullish momentum.

Investors are advised to consider both technical and fundamental factors before making decisions about KAITO. The market's current sentiment is bearish, and the platform's ability to innovate and adapt will be crucial in determining its future trajectory.

The overall crypto market is also under scrutiny as regulatory and policy changes continue to shape the landscape. The recent Senate Banking Committee delay in discussing the crypto market structure bill adds to the uncertainty. This delay could impact the broader market, including Kaito and other crypto assets.

The Kaito token's future will depend on its ability to pivot and find new ways to engage users and generate content. The market's response to these challenges will be a key factor in determining the token's long-term prospects.