Bittensor (TAO) has recently gained significant attention in the digital currency market, particularly among those focused on artificial intelligence (AI). In just 30 days, TAO has surged by an impressive 109% and reached a market capitalization of $2.9 billion. So, what exactly is propelling this growth?
One of the major driving factors behind Bittensor’s success is its transition from a niche crypto-AI project to a platform with widespread recognition within the open-source AI community. This shift has been fueled in part by a significant network upgrade proposal called Dynamic TAO.
Bittensor operates using specialized networks called subnets, each dedicated to specific machine learning use cases or resource provision. These subnets offer various services such as conversational AI platforms, prediction tools for financial markets, pre-trained models, synthetic data, and data storage solutions.
However, the current system has a couple of key issues. Firstly, the top five Root validators control over 60% of the token supply, leading to a concentration of influence over emissions. Secondly, the manual process of setting emissions for each subnet becomes increasingly impractical as the number of subnets grows, causing scalability issues.
To address these issues, the foundation has proposed the Dynamic TAO upgrade, which aims to replace the Root Network with an automated, market-driven mechanism for emission distribution. Under this upgrade, each subnet would have its unique token and native liquidity pool paired with TAO. Emissions would be allocated based on the relative market price of these subnet tokens, allowing subnets that generate the most value to receive more emissions.
The design of subnet tokens as non-transferable outside the Bittensor system creates bullish demand for TAO. Acquiring subnet tokens would require purchasing and staking TAO within a subnet pool for validation or speculation. This setup is expected to drive increased demand for TAO, as the requirement to purchase TAO before acquiring subnet tokens would create a surge in demand if subnets achieve a collective valuation of $1 billion.
Overall, the Dynamic TAO proposal sets the stage for an “AI Casino” within Bittensor, which has positive implications for the platform and the token’s price growth. Bittensor’s initiatives to drive growth within its ecosystem, attract investors, stakers, and developers focusing on artificial intelligence, further leverage the potential of its native token, TAO.
Currently, the TAO token is trading at $481, with a 12% increase within 24 hours. It has demonstrated sustained growth over significant time frames, with an 8% growth in the past 7 days and an 85% growth over the past 14 days. It remains to be seen how the protocol will continue to attract new investors and developers, potentially driving TAO’s price beyond its current all-time high of $521.