Austin Barack
CIO of RockawayX Liquid, Fundamental Long/Short Investing
TAO's narrative took a big hit after Covenant appeared to completely rug existing holders of its subnet tokens Templar, Grail and Basilica, prompting an exit from both the subnets and TAO. It is like the largest app on a layer-1 rage-quitting the chain and taking all value from its own token. Coming back depends on seeing network-level updates that prevent a repeat, which are in the works. x.com x.com x.com x.comÂ
Bittensor's TAO has much more downside to come. The trade was extremely crowded, with everyone talking about it but no one able to articulate a strong bull case, and the timeline is now full of angst, fighting and cope from bagholders. Anyone looking to allocate should be very patient. x.com x.comÂ
Bittensor's new Gamma tokenomics are unattractive, making the protocol even more complicated and possibly useless. x.comÂ
Bittensor is the leading AI crypto project, so TAO should run once the FUD clears; it is one to buy and hold. x.comÂ
Bittensor's TAO suffers because the network lets subnets like SN95 extract millions in emissions without delivering. SN95 has made promises for over a year, shown no functional product or code, keeps pushing deadlines, barely communicates and raised money on the side. Its owner not selling, as @0xSunRun notes, doesn't change that: emission-inflated prices let others sell into the pool, and if the subnet is deregistered, the TAO is paid out and leaves the chain. x.com x.com x.com x.com x.com … Show more
TAO could surprise to the upside in the short term on the strong AI narrative, but there is no reason to believe in it long term. x.comÂ
Bittensor's subnet economy could lift TAO via Alpha-token demand, but a major rally needs paying AI customers, not emission farming. About 64.2% of circulating TAO was staked as of Oct 7. At ~$3.24B, TAO is no cheap microcap. Still constructive long term, but stronger conviction needs verifiable revenue, demand above issuance, competitive AI products and institutional access. AI sentiment and crypto liquidity must also recover; Grayscale trust filings alone do not guarantee inflows. x.comÂ
Bittensor's arbitrary reward functions make its design far more complex than Pearl's MatMul focus, and that complexity works against TAO. Bittensor might still work if it got the design right; if not, repeated revisions may never reach a working end state. Pearl could get there faster and, if correct, get much bigger, though it too may fail. If, as Sebtensor says, TAO is an AI economy rather than AI money, Ethereum's struggle to accrue value to ETH is a further bearish warning. x.com x.com x.comÂ
Bittensor's staking and reward design is an unlimited money glitch for its founders and network participants, and TAO will not make sense for holders until subnet-staked TAO is time-locked and 90% of rewards are vested. A post the author replies to adds that subsidy-to-revenue ratios reach 40:1, with $150M+ in emissions producing low seven figures of revenue, and that TAO trades at about 550x. x.comÂ
Bittensor's nearly two-and-a-half-year downtrend is very close to ending, needing a weekly close above 320 to confirm a higher high, after which 500 looks easy. Businesses owning subnets now do $25-30m in annualized revenue, estimated at about $100m by year-end, from real paying customers. TAO pumping last has not been a great signal before, but Bitcoin's higher high and clear bullish structure change likely make this time different. x.com x.comÂ
Bittensor is a crypto-Ponzi with no utility or product-market fit, driven entirely by token inflation: about $328M of TAO is printed annually against only $15M of revenue. Holders fund subnets through inflation, yet operators keep 100% of revenue plus 18% of emissions. Per Pine Analytics, unsubsidized inference on the Chutes subnet costs up to 3.5x centralized rivals, as decentralized compute needs verification and replication and suffers latency. It is unsustainable and headed for collapse. … Show more
