Elon Musk’s social media platform X is moving to restrict crypto-linked projects that reward users for posting.
This has drawn criticism from parts of the digital asset community, raising questions about the future of so-called “Crypto Twitter.”
X is not banning cryptocurrency or crypto-related discussion outright.
However, some industry participants say the move could disrupt engagement models common in crypto-focused communities.
The backlash comes as Musk and his companies face heightened scrutiny from governments over the ability of X’s AI chatbot, Grok, to generate manipulated and sexualized images on the platform.
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X Cuts Off InfoFi Projects
Nikita Bier, X’s head of product, said the platform would no longer allow applications that financially incentivize user activity.
The head of product argued that such models had contributed to spam and low-quality content.
“We will no longer allow apps that reward users for posting on X,” Bier said in a post on the platform, adding that API access had been revoked for a number of projects operating under the model, often referred to as “InfoFi.”
The decision triggered a sharp sell-off in several digital assets linked to engagement-based incentives.
Kaito, a project closely associated with the InfoFi model, saw its token fall more than 15% shortly after the announcement, according to data from CoinGecko.
Other tokens tied to similar models also declined.
Bier said developers whose accounts had been terminated could seek assistance transitioning their projects to other social platforms, including Meta’s Threads and decentralized network Bluesky.
The move follows months of internal criticism over repetitive posting tactics within crypto-focused communities, which X executives have blamed for diminishing content quality on the platform.
Crypto Backlash
The decision drew mixed reactions from crypto users on X, with some arguing that the policy risks penalizing legitimate creators alongside bots and spam accounts.
Several users said that while X’s own creator payouts lag behind those offered by rival platforms, token-based projects had provided an alternative way to earn income.
“This really confuses me Nikita,” said one X user.
“X doesn’t pay content creators anywhere close to other platforms but we stay here because we can earn via other means (InfoFi) and also because this is the platform where all this new tech is being birthed.
Adding: “We’re not all bots.”
Some users also questioned the consistency of the policy, noting that X itself offers monetization features tied to posting and engagement.
“X literally rewards users for posting on X,” one user wrote, arguing that platform incentives had contributed to the same low-quality content X is now seeking to curb.
Not all responses were critical.
Other users welcomed the crackdown, saying engagement-based monetization had encouraged automated posting and repetitive replies that degraded discussions.
One user described the move as overdue, blaming financial incentives for the rise of so-called “AI slop” across the platform.
X Expands Crypto-Native Tools
At the same time, X has continued to develop crypto-adjacent features.
Earlier this week, the company announced it was working on a feature called “Smart Cashtags,” which allows users to link posts referencing stocks or digital assets to live market data.
The tool enables users to specify a particular asset when using tickers such as BTC or ETH, reducing confusion caused by overlapping or ambiguous symbols.
Tapping a Smart Cashtag opens an in-app page displaying real-time prices, charts, key market data and related posts.
The design is intended to keep users within the platform by providing immediate context without requiring navigation to external websites.
Bier said the underlying application programming interface would support near real-time updates.
Grok Faces Regulatory Scrutiny
The policy shift comes as Musk’s AI chatbot Grok faces mounting pressure from regulators over its image-generation capabilities.
Earlier this month, Grok generated hyper-realistic manipulated images on X depicting women without clothing, prompting criticism from officials and advocacy groups.
Governments in several countries called on Musk to tighten controls on the tool.
xAI, Musk’s artificial intelligence company, said late on Wednesday that it had restricted image-editing capabilities for Grok users.
Britain’s media regulator Ofcom said it welcomed the changes but confirmed that its investigation into Grok remains ongoing.
“Our formal investigation is ongoing,” an Ofcom spokesperson said, adding that the regulator was seeking further clarity on how the images were produced.
