Hiruzen had summoned Kakashi to his office. Hiruzen was still wary if he should go along with this plan, but he knew he had to stay tough because he had already made that mistake with his previous students and he didn't want to make the same mistake twice. He wanted to make sure the person he chose to reveal the truth to Jaikio was the right person, and he knew who could help him with this. So, Hiruzen called his ANBU to go find Kakashi Hatake.
Kakashi was visiting his sensei Minato Namikaze's grave and was wondering what his sensei would think about the Copy Cat Ninja if he were still alive. He was interrupted when one of the Hokage's personal ANBU guards informed him that the Hokage had summoned him. Although Kakashi reports to Danzo as an ANBU member, he decided to head to the Hokage's office to see what he wanted.
Hiruzen was currently doing paperwork and swearing to himself because he had just gotten into his office today but was already given so much paperwork that it would take at least 5 hours to get all of it done. However, Hiruzen was pulled out of his thoughts when he heard a knock on his door. He said, "Come in."
Kakashi had finally made it to Lord Third's office. He had been walking around the building before he came to the office and he swore nothing ever changes inside. Nevertheless, he decided to knock on the door. When he entered, he saw the Hokage smiling at him, so he bowed before asking him politely why he had been called.
Hiruzen looked at Kakashi sadly because he still regretted having Kakashi in the ANBU, but Hiruzen would be lying if he said that Kakashi wasn't a good asset to the ANBU. Actually, personally, Hiruzen thought that Kakashi was the strongest person in the ANBU currently, with the exception of Itachi Uchiha, who was showing huge promise. However, Hiruzen also hated how the ANBU seemed to take away shinobi's ability to feel emotions. Nevertheless, he decided to file it away for later and told Kakashi why he had really called him there. Hiruzen proceeded to tell Kakashi about his plan for Jaikio.
When Kakashi finished hearing the plan that the Hokage had in mind for his surrogate grandson, he was shocked because he never would've thought the Kage would do this.
at least not someone who is still so young, and I just had to ask Kakashi if he was sure that he was doing the right thing. If Kakashi was being honest, he didn't even know why he cared so much at this point.
Hiruzen was surprised by the emotion that Kakashi had just expressed, and he couldn't help but smile slightly, knowing that there was still hope for Kakashi. I then told Kakashi that I was positive that this was the best choice. While he knows the saying "ignorance is bliss," ignorance and blissfulness would get a ninja killed in battle. I then proceeded to ask him what he was going to do.
Jaikio was playing with Naruto, pranking some of the chunin, until one of the guards that his surrogate grandfather, The Third Hokage, had assigned to him appeared before him, saying that his grandfather was summoning him to his office. So, I had to tell Naruto that I would play with him later and head towards the Hokage tower. When I arrived at his office, I just walked right in, saying hi to my grandpa.
Hiruzen was hating himself for what he was about to do to Jaikio, someone he considered as his grandson, and it only amplified when Jaikio walked into his office. But he knew that if he started to act weak now, Jaikio might end up just like his previous students, and he didn't want that to happen. So, he nodded to Kakashi, but not before telling Jaikio that he was sorry and it was necessary.
Kakashi was wondering if he should do this because while people might think he's just a cold-hearted ninja, he just didn't want to get close to anyone anymore. He was afraid of losing them like he did with his team. But he proceeded to nod at the Hokage because he knew that what the Hokage said made sense. Kakashi looked back at Jaikio and was about to show him the true darkness of the ninja world.
Jaikio didn't know what his grandfather was talking about when he told him he was sorry. Originally, Jaikio thought that his grandfather had accepted his and Naruto's request to join the academy, but from where Jaikio was standing, this was about something else. Before he could ask the Hokage what he was talking about, it felt like he was transported somewhere else. It seemed like he was in a place full of darkness.

Kakashi told Hiruzen that he did the genjutsu, with Hiruzen sighing sadly, hoping his grandson would be okay.