My Information Becomes Money… Blockchain and AI Combined InfoFi 'Kaito' [Hwang Doo-hyun's Web3+]

Blockchain and AI Combined InfoFi 'Kaito'

Narrative as an Asset… Institutions Pay Attention

From Reward System to Token Issuance

InfoFi Combining Information and Finance

Criticism on the Justification of Token Issuance

The Web3 search platform 'Kaito', which combines artificial intelligence (AI) and blockchain, is emerging as a new trend in the virtual asset (cryptocurrency) industry. It is evaluated that it has established the concept of 'InfoFi', which gives financial value to information through the reward program 'Yaps' and the issuance of its own token 'KAITO'.

InfoFi is a concept that strengthens the reliability and accuracy of information and structures it so that it can be used like financial assets. Vitalik Buterin, co-founder of Ethereum (ETH), mentioned in a blog last November that "InfoFi will also grow rapidly with the development of AI," and that "a system is needed to break down the boundaries between information and finance and select meaningful data."

Kaito Gathers Fragmented Information in One Place

Kaito Dashboard / Photo=Website Capture

Kaito is an AI-based Web3 research platform established in 2022. Its core is to collect and analyze real-time information based on virtual asset communities that existing search engines cannot capture and provide it tailored to users.

To this end, Kaito integrates and provides data scattered across the entire crypto ecosystem, including X (formerly Twitter), Discord, Telegram, Medium, blogs, and various on-chain forums. 'Mindshare', which shows the volume of conversations, community reactions, major issues, and trends in real-time numbers for specific projects, and 'Sentiment Tracker' help to grasp the market atmosphere at a glance.

Yu Hu, the founder of Kaito, explained the reason for Kaito's birth, saying, "In the virtual asset industry, information is an asset that combines narrative and attention. You need to be able to analyze and measure it to discover true value."

The differentiated approach led to market reactions. More than 500 institutions, including Hashed, Grayscale, and Solana Foundation, are registered as Kaito's paid customers, and the projects and data sources linked to the platform exceed 2,000. The industry evaluates Kaito as a 'next-generation research infrastructure' beyond a simple search tool.

Kaito's growth trend is also confirmed in its investment attraction performance. In 2022, it raised $5.3 million in a seed round led by Dragonfly, and in 2023, it additionally raised $5.5 million through a Series A round participated by Spartan Capital. The total accumulated investment is $10.8 million, and the company's value is evaluated at $87.5 million.

Gate.io predicted, "Kaito is innovating the virtual asset environment by providing complex and decentralized virtual asset data more easily," and "Kaito will play a central role in the future of Web3 information access and analysis."

My Information and Influence as Points... Reward Program 'Yaps'

Kaito Yapper Leaderboard / Photo=Website Capture

The reward system 'Yaps', launched by Kaito in December 2024, is considered a representative example of this philosophy being implemented. Yaps is 'attention points' that quantify the influence of users active in the virtual asset community and are given to users like rewards according to content creation and dissemination. Currently, the community is limited to X.

Yaps is different from simple activity scores. Users can participate in project evaluation, launchpad voting, and influence ranking (Yapper Leaderboard) competition within the Kaito ecosystem using Yaps. Top users on the Yapper Leaderboard also receive additional rewards such as airdrops or campaign invitations from the project side. In other words, Yaps functions as a 'proof of participation means' that creates economic value within the Kaito network.

Kaito has created a structure that provides substantial rewards to information producers in the Web3 ecosystem through Yaps. Users who engage in influential activities on X or distribute valuable information receive more Yaps. Accordingly, Yaps is also being used as a key indicator of initial spread strategy or marketing.

The virtual asset analysis company Populus analyzed, "Yaps functions as a core indicator measuring on-chain reputation and influence," and "virtual asset projects are using it by distributing airdrops to top rankers on the Yapper Leaderboard. Yaps will establish itself as a measure of personal influence in the virtual asset market in the future."

Kaito Expands Ecosystem with Token Launch... Question Marks on Justification

Having successfully settled the Yaps system, Kaito once again embarked on ecosystem expansion by issuing its own token 'KAITO' in February this year. The total issuance is 1 billion, and the initial circulation is 241 million. Of this, 10% was distributed to the community and Yaps contributors through airdrop.

KAITO is used for staking, rewards, and governance participation within the platform. In particular, the structure where voting rights using Yaps are strengthened if a certain amount of KAITO is staked is characteristic. The plan is to raise the value of KAITO by designing a structure where users holding Yaps can expand their influence through KAITO.

The global virtual asset exchange MEXC evaluated, "The fact that you can participate in governance voting through KAITO staking can induce long-term holding," and "this design can encourage user participation and contribute to platform growth."

However, there are some skeptical views on the justification of KAITO token issuance. There is a question of whether its own token is really necessary since Kaito originally started as a research tool. In particular, there are also criticisms that there is a lack of explanation about the distribution structure or clear utility of KAITO.

Populus pointed out, "While Kaito's Yaps has a clear demand base, KAITO's utilization and demand creation method are unclear," and "the excellent product Kaito may blur its identity due to the token."