Original title: Bittensor = AI Bitcoin?

Original author: S4mmyEth, Decentralized AI Research

Original translation: zhouzhou, BlockBeats

Editor's note: This article discusses Bittensor, a decentralized AI platform, hoping to break the monopoly of centralized AI companies through blockchain technology and promote an open and collaborative AI ecosystem. Bittensor adopts a subnet model that allows the emergence of different AI solutions and inspires innovation through TAO tokens. Although the AI ??market is mature, Bittensor faces competitive risks and may be influenced by other open source AI frameworks. Continue to delve into subnets, analyze their application and development potential, and focus on how Bittensor can drive the future of decentralized AI.

The following is the original content (the original content has been compiled for easier reading comprehension):

As the first halving of Bittensor approaches in November 2025, more and more speculation is that this may be similar to Bitcoin’s historical price cycle - but this time, artificial intelligence has become the core.

Introduction

The rise of artificial intelligence has been dominated by centralized entities such as OpenAI, Google and Meta. While these companies drive incredible technological advances, they also maintain strict control over the development of AI, data access and monetization.

At this time, Bittensor (TAO) came into being - a decentralized AI market that aims to disrupt the traditional business model by creating a peer-to-peer economic model in which contributors (whether providing computing resources, AI models or data) can be directly rewarded.

Bittensor provides a transparent and inspiring innovative approach to AI with similar features to Bitcoin network incentives.

Its goal is to democratize AI and ensure that no single entity has too much control over machine intelligence.

This analysis will explore how Bittensor works, its unique subnet structure, token incentives, and why it may be one of the most attractive cases of decentralized AI development.

Catalog

What is Bittensor?

How Bittensor works

Comparison with Bitcoin

Subnet Ecosystem

Network Incentives and Dynamics TAO

Key Differences between Centralized AI Companies

Conclusion

What is Bittensor?

Bittensor is a decentralized blockchain-based network designed to facilitate collaborative development, sharing and improvement of AI models.

Why pay attention?

Unlike traditional centralized AI systems such as OpenAI, Bittensor creates an open peer-to-peer ecosystem. Participants are rewarded for their contributions such as computing resources, data, or AI models.

Bittensor’s mission is to democratize AI, make it easier to access, and reduce the control of a few large companies.

Comparison with Bitcoin

AI will not disappear, it is a macro trend that will be integrated into various industries. There is an opportunity hidden here. If Bittensor becomes the key decentralized network for open source AI and institutional investors are familiar with Bitcoin’s halving mechanism, then TAO could become a very attractive investment asset.

Bittensor adopts a halving mechanism similar to Bitcoin; TAO's first halving is expected to occur in November this year.

Bitcoin’s first halving occurred on November 28, 2012, and its market value has soared by 13,125 times since then:

Do I think TAO will rise from here to 13,000 times?

Absolutely not, that's too crazy. It now has a market capitalization of $2.9 billion (price: $342), and our current market situation is obviously more mature than in 2012. So it can be said that in the current network state, many speculative factors have been reflected in the price.

However, the collaborative open source nature of the Bittensor network means that development is very fast and shows parabolic growth.

Any development, incentive or innovation from a subnet can be replicated onto other subnets, thereby improving the level of the entire ecosystem.

You can think that one of the Alpha tokens (subnet tokens) may be greater in the potential to achieve multiple growth, but there is also the risk of choosing the wrong token. So, let's dig deeper into how it works.

How does Bittensor work?

Bittensor operates as a market for machine intelligence, powered by TAO. The Tao Stats website created by mogmachine provides a great dashboard to view 70 subnets currently available:

Indexing the TAO ecosystem is not easy, so a user interface (UI) like this aggregates data in a meaningful way for analysis. Key players in the TAO ecosystem can be classified into the following categories:

Ultimately, the accumulation of value comes from application developers and end users who create products that leverage the AI ??model of the Bittensor subnet. Cookiedotfun recently launched a dashboard highlighting some of the agents utilizing Bittensor:

There are only 12 listed right now, but as more apps take advantage of Bittensor, this number is expected to grow:

However, the dashboards only cover agents utilizing Bittensor, and as they enter the market, more content will be gradually added in the future. Many protocols also use Bittensor for AI integration.

Subnet Ecosystem

Subnet 1 (root subnet) is specifically used for text prompts and is owned by the opentensor Foundation; it currently holds most of the pledged TAOs with a total market value of US$2.09 billion. In October 2023, the network expanded more subnets and now there are 69 subnets owned by third parties outside the foundation. Here is an exciting division of these subnets by old samster at Crucible Labs:

Each subnet focuses on specific AI-related tasks and serves as an independent market in which participants collaborate and compete. If you are building an application, one of the subnets may enhance the solutions you provide through AI. Some people compare TAO's subnet to an "accelerated version of virtual machines" and believe that bidding for specific subnets may bring opportunities for high activity in the future. hmalviya9 points out subnet 5 (OpenKaito) as an opportunity, especially in the recent craze of KAITO airdrop:

But before you go all out to buy subnet tokens, make sure you understand the emission mechanisms and core value propositions of each subnet. Currently, the total market capitalization of all 70 subnets is $72.5 million, and it currently takes 408 TAOs (approximately $151,000) to register a subnet and is now non-refundable:

A little like locking Virtuals io's tokens in LP to serve a single agent. But in this case, each subnet has a unique value proposition that can be leveraged by real-world applications to improve efficiency.

Therefore, subnets must have strong value propositions to remain feasible. If you rush to buy a specific subnet token, it may cause the subnet to gradually disappear and the price will also fall accordingly.

Example Subnet

Some subnets you may be familiar with come from the following overall applications:

Open Kaito ai (Subnet 5): Used to provide AI algorithm support for KAITO

Sports Tensor (Subnet 41): Used to support agents such as askBillyBets
• Synth (Subnet 50): Used to predict the pricing of crypto assets and integrate into Modenetwork's DeFAI solution
• Network incentives
• TAO Token incentives are allocated based on the "Yuma Consensus" model. This model allocates rewards based on the activities of the subnet, further pushing each subnet to create real value for the applications it builds.

Dynamic TAO (which will be available on February 13, 2025) is a new tier for fine-tuning the economics of rewards, making emissions more flexible and linked to overall network activity, without relying solely on the previous “Bitcoin Half” mechanism.

Subnets must create actual demand for their Alpha tokens (subnet tokens) in order to earn more TAOs, thus creating a competitive environment where practicality drives success.

If you want to get a more comprehensive view of this, you can read the 0xprismatic article.

Key Differences from Centralized AI Companies

Why do we need to develop a decentralized alternative to challenge companies like OpenAI?

At the end of the day, centralized models rely on opaque black boxes, internal teams, and develop solutions in isolated environments. The decentralized model provides greater transparency and allows more contributors to participate in a collaborative way. Here is a more comprehensive comparison:

Conclusion

Bittensor represents a paradigm shift in AI development—from centralized control to a more open, peer-driven ecosystem. The network’s subnet model allows the emergence of specialized AI solutions, while TAO’s incentive structure ensures that only the most useful and innovative subnets can thrive.

With the introduction of dynamic TAO, the protocol now has an adaptive economic model that rewards real-world practicality and engagement. However, investors and developers must carefully evaluate the subnet before entering, because only the strongest projects can maintain long-term value.

As Bittensor’s first halving approached in November 2025, there is growing speculation that this may be similar to Bitcoin’s historical price cycle—the difference is that AI is at the center this time. However, it is important to remember that the market is mature, we have just experienced a preliminary AI boom, and there are risks, that other open source AI contributors may create equally valuable frameworks or networks, which may reduce the accumulation of value for TAO tokens.

Whether Bittensor eventually becomes the backbone of decentralized AI or just as a groundbreaking experiment, it has sparked important discussions about the future of AI governance, accessibility and innovation.

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