InfoFi: what is data-driven finance, and how is it changing the blockchain industry?
As DeFi has evolved, it has become a global financial ecosystem, which, according to DeFi Llama data for February 2025, is worth $91.7 billion. Therefore, it is natural that the decentralized finance market has eventually been divided into different segments, such as GameFi, SocialFi, MetaFi, and others. One of these segments is InfoFi, which has emerged with artificial intelligence (AI) development and will be discussed in this article.
What is InfoFi?
InfoFi or Info Finance is a new concept in the DeFi segment that is changing the way information is collected, verified, and shared in different areas of the crypto industry. The term InfoFi stands for "information finance." As the name suggests, InfoFi's main market focus is the media industry.
One of Info Finance's main objectives is to integrate information technology into financial systems and processes, including:
- Artificial Intelligence (AI);
- machine learning and big data;
- Internet of Things (IoT);
- blockchain.
Ethereum co-founder Vitalik Buterin presented the concept of InfoFi in 2024, which he described in his article "From Predictive Markets to Information Finance."
How is the InfoFi market structured, and what problem does it solve?
One key component of the media industry is user "attention" or, as marketers say, engagement. According to the Ethereum co-founder, centralized services distribute content, be it entertainment (e.g., YouTube, TikTok) or informational (Trading View, Binance Square), inefficiently and, in some cases, unfairly.
First, the services themselves have complete control over the algorithms of media platforms, ignoring free market mechanisms that would distribute content based on genuine user needs. Companies can customize content distribution algorithms to suit themselves, pursuing their own goals and ignoring users' interests and needs.
Second, content creators receive only a tiny portion of the profits. At the same time, companies also control who and how much to pay for publishing content. The reward systems of media services such as YouTube or TikTok are often unfair. Only the prominent bloggers get most of the revenue. In contrast, aspiring authors get nothing and have to invest large sums in promotion, which is rarely practical due to the same biased algorithms for content submission.
The Info Finance concept is designed to solve these problems through decentralized platforms that will increase the efficiency of work in the information field and the development of artificial intelligence technology.
Using banking systems as an example, Info Finance is being applied to develop AI-based personalized services. For instance, with the help of AI, banks personalize credit offers for their customers, taking into account their financial activity, which is also automatically analyzed by neural networks.
In the investment environment, for example, stock exchanges or InfoFi platforms are developing AI advisors for automated portfolio management, including cryptocurrencies. Their work is also aimed at improving investment strategies and risk assessment, taking into account the data that AI assistants analyze in real-time, which allows them to act quickly in view of the current market situation.
One of the first InfoFi platforms to make this possible was Kaito. The Kaito platform is a decentralized artificial intelligence-based platform for users to work with crypto market data efficiently
- Social media sentiment;
- Project and token updates;
- Metrics and other dynamic Web3 market metrics;
- On-chain activity.
Kaito represents users' attention or engagement as an asset. Content is distributed based on the community's real needs: the marketplace itself determines which brands, bloggers, or topics deserve users' attention.
Conclusion
InfoFi will likely be the basis for a new generation of media platforms that will replace centralized services like YouTube and primarily follow the interests of users and content creators rather than companies.
Among other things, Info Finance will make financial services more accessible to users worldwide. This, in turn, will allow financial companies to expand their customer base in regions without banking services.
In the future, InfoFi platforms will be able to challenge traditional financial companies and media services by providing more adaptive and fair information systems.