Author: Jun, Bankless; Translated by: Baishui, Golden Finance
Bittensor (TAO) has captured the attention of investors, and it’s easy to understand why. The narrative around AI is both simple and powerful, and in the current crypto cycle, few categories are hotter than AI x Crypto. As one of the most prominent projects in the space, Bittensor has positioned itself as one to watch.
Essentially, Bittensor is pushing a new frontier: creating a decentralized network where AI models can be trained and shared in a way that is incentivized for both developers and users.
This combination of a clear narrative and real technological substance has captured the market’s imagination. But there’s more to this story than just hype. Behind the recent price surge are significant developments in the TAO ecosystem itself, as well as widespread enthusiasm for artificial intelligence.
In this article, we’ll explore what’s happening in the Bittensor ecosystem and examine upcoming catalysts that could drive its momentum.
Subnet Expansion
A major catalyst behind Bittensor's growth has been the rapid expansion of subnets. Introduced a year ago, subnets have quickly become the backbone of Bittensor's development. Today, Bittensor has over 50 active subnets on the mainnet, with many others on testnet that will go live in the near future. The proliferation of subnets has accelerated the network's functionality, attracting more developers, users, and attention.
The Opentensor team (a major contributor to the Bittensor ecosystem) understands the importance of this and has steadily increased the subnet limit over time — initially from 32 to 45, and now to 52. The gradual increase in the cap reflects both the growth in network capacity and the need to bring more subnets online.
As subnet limits are gradually expanded — and eventually removed entirely — the potential for exponential growth within the Bittensor ecosystem becomes clear. More subnets means more AI models, more collaboration, and more growth for the ecosystem.
Dynamic TAO: Turning Bittensor into an Investor’s Playground
One of the most anticipated upgrades in Bittensor’s history is the dynamic TAO or dTAO. Now live on the RAONET testnet, dTAO will introduce dynamic markets for subnets.
With dTAO, each subnet will soon have its own token, allowing its value to be determined by market forces. This fundamentally changes how subnets operate and how participants interact with the network. Subnet tokens will create a competitive landscape where the most efficient and valuable subnets thrive, while less efficient subnets fade away.
Additionally, this brings new speculative dynamics to the Bittensor ecosystem. TAO holders will now bet on individual subnets as well as the entire network. For investors, this opens up new opportunities - they will be able to screen subnets, analyzing their performance, utility, and long-term potential. Just like cryptocurrency traders search Coinmarketcap to find undervalued gems, dTAO will create a similar dynamic in the Bittensor ecosystem.
Crucially, all of this activity has increased demand for the TAO itself. Since the TAO is required to acquire any subnet tokens, the introduction of the dTAO is likely to further stimulate demand for it, making Bittensor even more attractive to investors.
TAO will halve in 2025
Bittensor is approaching its first halving event, which is expected to occur in late 2025. Much like Bitcoin’s halving cycle, this event will cut the issuance rate of new TAO tokens in half.
Currently, the Bittensor network issues 1 TAO (7,200 TAO per day) in the form of block rewards, which are distributed to miners, validators, subnet owners, and delegators. However, when the halving occurs (triggered when 10.5 million TAO are in circulation), this issuance will be halved to 0.5 TAO per block, thereby reducing the supply of new TAO entering the market every day.
Why is this important? When the supply of TAO decreases, it creates scarcity. In any market, decreasing supply and steady or rising demand (thanks to the addition of subnets and the introduction of dTAO) can only lead in one direction: up.
What makes this event particularly bullish is the psychology behind the halving cycle. Investors often anticipate these events months in advance, leading to speculative buying as market participants prepare for the upcoming supply shock. Bitcoin’s halving events have always triggered price surges, and TAO’s first halving could generate similar excitement within the Bittensor community and beyond.
Bittensor's Unparalleled Attention
Bittensor continues to attract the attention of the crypto and AI communities. From a busy sideline at Token2049 in Singapore to a popular talk at Google, it’s clear that Bittensor is maintaining a consistent presence in the space.
The project’s fervent following on Twitter keeps the conversation active, pushing τ further afield. Asset managers such as Grayscale and Arca have publicly shared their bullish outlooks, further legitimizing Bittensor in the eyes of institutional investors.
Now let’s look at the macro-level things happening in the world of AI that are considered beneficial for AI x crypto projects like Bittensor.
The Problem with OpenAI
OpenAI is at a crossroads. Recently, it was announced that OpenAI is transitioning from a nonprofit to a for-profit benefit corporation. Following this restructuring, the company’s valuation has soared to over $150 billion and it has raised $6.6 billion in new funding.
Additionally, several key executives recently left, including Chief Technology Officer Mira Murati and two other executives, raising concerns about potential internal problems.
The shift has set off alarm bells in the AI safety community, prompting many to question whether OpenAI can truly be committed to responsible AI development when profit comes first.
Against this backdrop, the promise of open-source, decentralized platforms like Bittensor becomes clear. While OpenAI charts the path to enterprise, Bittensor represents a vision for a more equitable AI future that thrives on community-driven efforts.
Regulatory uncertainty around centralized AI
Centralized AI is hitting roadblocks everywhere. As governments scramble to regulate, the restrictions they impose could stifle innovation. AI is already under scrutiny in various jurisdictions. Europe is rolling out the (AI Act) which mandates adherence to strict standards, while China has set rules to align AI with national policy. In the United States, regulators are making the rounds, calling for more oversight and control; however, in a recent incident, California Governor Gavin Newsom vetoed a major AI safety bill that would have imposed strict regulations on AI models. Many viewed the veto as positive, as it avoided heavy-handed regulation that could have hindered innovation and driven AI companies out of California.
Despite this, AI regulation remains very strict in various jurisdictions around the world. The fact that centralized AI is subject to regulatory control highlights a fundamental flaw: it is too easy to control.
When a few large companies hold the keys to centralized AI, they become prime targets for government pressure and censorship. This is where decentralized AI platforms like Bittensor come in handy. They can’t be shut down or censored by any single entity because no single entity controls it.
Conclusion
There are a lot of things going well for Bittensor, and the token price increase is just the icing on the cake. With the existing momentum, the aforementioned upcoming updates, potential EVM support, and continued community development (such as the rapid integration of NousResearch’s breakthrough in distributed training into Bittensor), these are strong indicators of Bittensor’s prospects.
In a world where centralized AI is increasingly subject to regulation, scrutiny, and profit motives, Bittensor offers a compelling alternative: a decentralized, community-driven approach built on collaboration, innovation, and shared incentives. Here’s why it’s worth watching.
