Bitcoin is now in its fourth quadrennial halving, with other decentralized projects adopting similar supply-reduction cycles – and Bittensor is approaching its first halving since launching in 2021.
Bittensor, a decentralized, open-source machine-learning network built around special “subnets” that encourage markets for AI services, is expected to undergo its inaugural halving on or around December 14. At that time, the issuance of its native token, TAO, will drop to 3,600 per day from the current 7,200.
Grayscale Research analyst William Ogden Moore called the event “an important milestone in the maturity of the network as it approaches its 21 million token supply limit,” matching Bitcoin’s (BTC) fixed limit.
Digital-asset investors and network participants often view hard-capped supply as a potential price catalyst: if adoption grows and demand for tokens increases, a limited issuance model could be more attractive than pre-mined tokens or fiat currencies with effectively unlimited supply.
Cointelegraph reported on Bittensor in May during a conversation with Chris Miglino of DNA Fund, whose AI compute fund is heavily involved in the Bittensor ecosystem.
“The biggest thing we are working on in the whole ecosystem is our AI Compute Fund, where we have joined the TAO ecosystem,” Miglino said.
Connected: Grayscale introduces Bittensor and Sui Trust products
A dive into Bittensor Subnets
Grayscale describes Bittensor’s subnets as a kind of “Y Combinator for decentralized AI networks,” as each one works like a startup creating a particular product or service.
CoinGecko currently lists over 100 Bittensor subnets, with a combined market capitalization of over $850 million. TaoStats, which tracks the ecosystem more broadly, shows 129 subnets with a total market capitalization of close to $3 billion.
In any case, subnet valuations have increased significantly since launch, according to Grayscale Research. The largest include Chutes, which provides serverless computation for AI models, and Ridges, a subnet focused on crowdsourcing for the development of AI agents.
This expansion underscores the growing demand for decentralized AI infrastructure as developers race to create and scale new AI products and applications.
As Miglino told Cointelegraph, decentralized AI could prove to be the most important use case of blockchain after Bitcoin, largely driven by that demand.
Bittensor subnets are also attracting venture capital. Inference Labs recently closed a $6.3 million round to support Bittensor marketplace Subnet 2 for inference validation.
Meanwhile, xTao, an infrastructure developer building tools and services for the BitTorrent ecosystem, began trading on the TSX Venture Exchange as a new public company in July.
Related: VC Roundup: Big Money, Few Deals As Crypto Venture Funds End
