Kaito Genesis Drop Sparks Controversy

Eligible participants were able to cash out a 40x on Kaito’s NFT mint, but others accuse the team of a poorly executed allowlist.

By: Squiffs • December 26, 2024

Kaito, an AI-powered data and social tool, quietly launched its genesis NFT collection on Dec. 19. While eligible minters were gifted a 4000% return on their investments, many Kaito users are unhappy with the method used to determine eligibility.

The NFTs launched at a 0.1 ETH ($350) mint price, and traded as high as 4 ETH ($13,400). Users who had earned at least one Yap point and submitted their wallets on the website were eligible for the NFT drop.

The whitelist distribution ruffled feathers amongst users, and some went as far as to suggest insider trading.

“Most obvious “explanation” for the Kaito mint is that it’s an opportunity for insiders to have multiple mint spots and dump for free ETH while giving plausible deniability. That’s the simplest explanation for stealth adding the “add wallet” button to the profile page 24 hours before the deadline and not mentioning it prior to the deadline,” said IcoBeast on X.

Whitelists are a method of assigning NFT mint eligibility to certain wallets based on specific criteria or wallet submission forms.

Yu Hu, the founder of Kaito, took to social media on Dec. 23 to address the disappointment of one community member. Within the apology post, Hu said, “The NFT launch was far from perfect - and I'll make sure to learn from anything we could’ve improved.”

Kaito launched its social arm, Yaps, to the public on Dec. 11, where users can connect X profiles to the dApp, and earn yaps, akin to points, based on social media activity. However, users quickly pointed out that the algorithm behind the points distribution is unclear.

“Yaps seem to not count when you make a banger post but doesn't include crypto buzzwords/vc/projects,” claimed RunnerXBT.

The Kaito team addressed users’ concerns in its Discord channel, saying, “Content originality and relevance also play a critical role. Simply achieving high engagement is not sufficient if your content closely mirrors similar posts already available on X.”

Kaito did not immediately respond to The Defiant’s request for comment.