Written by: Joyce, BlockBeats

Editor: Jack, BlockBeats

Since the beginning of the year, the AI sector has been very popular, and the return on investment is more impressive than other tracks. Old projects with AI concepts are being launched one after another, and new projects that can quickly bring high returns are also appearing in droves. Among them, the Bittensor token TAO tripled from US$230 in January to around US$700, while Bittensor ecological projects that emerged during the same period such as TaoPad (TPAD), AIT Protocol (AIT), OpSec (OPSEC) And the growth multiples of many small projects that followed immediately exceeded TAO.

Bittensor has its own special features. Its subnet mechanism depicts the blueprint of "decentralized AI model incentive market". The token price has increased by 15% in the past six months. times, Bittensor has also become a frequent visitor in VC research reports. But in the eyes of the community, TAO does not seem to be a worthy investment target. The reason is simple: it is too expensive. Therefore, the recent emergence of Bittensor ecological projects has given investors more choices. Projects with the name "Bittensor" have achieved very good returns at the beginning of their development.

BlockBeats found that the recent Bittensor ecological projects are becoming more and more "watery". This kind of development is not unexpected, but these projects are the first step for many users to invest in and understand Bittensor. This change inevitably makes people have doubts. From the perspective of investment value, Bittensor’s innovative sub-network mechanism makes it The community regards it as the "Ethereum of AI", but for most investors, Bittensor seems to have become a new AI meme factory.

From one in three days to three in a day: "TAO Ecology" where local dogs are everywhere

Starting with recent projects, the price trend of their tokens is the most direct signal. Corresponding to the Twitter content, we can see the transformation process of these projects.

BlockBeats was featured in over a weekend 20 times increase, the AI Summer of the crypto market is coming" wrote in the article that two weeks ago, among the new AI projects that appeared on the Ethereum hot list, most of the projects were either GPU/CPU leasing Such decentralized infrastructure businesses are either several Bittensot ecological projects with "TAO" in their names. The latter all use the Bittensor ecosystem as a selling point, and can quickly attract the attention of the community as soon as they are launched. Some tokens have increased more than ten times a week, and most projects have quickly completed the jump from zero to tens of millions of dollars in market value within two weeks.

Before March 10 Some of the Bittensor ecological projects that have appeared

The first are Taτsu ($TATSU), Tao Bank ($TBANK) and Tao Accounting System ($TAS). None of these projects has released team information, nor has it been officially recognized by Bittensor, nor is it an official subnet of Bittensor. However, with the name of "Bittensor" and the release of a few code pages or product front-end pages, the token price can be achieved Climbing rapidly.

Taτsu’s token $TATSU completed in two weeks $0.2 when it was launched, $0.3 when the first tweet was posted, and $10 when the product page was released The dollar climbed 50 times. In early March, after the launch of the product "AI conversation assistant TaτsuASK", riding on the popularity of AI at the time, $TATSU exceeded $70 on March 8, completing a 35-fold turnaround from $3 to $70 in 15 days.

Another project, Tao Bank, comes from Bittensor ecological LaunchPad platform TaoPad, and its tokens The initial allocation price of $TBANK is $0.05 or $0.06. After the team created a liquidity pool for the TBANK/ETH trading pair, TBANK quickly reached $0.3 after being launched, and it also appeared on the Dexscreener hot list that day. On March 8, TBANK reached a high of $2.4 and increased 8 times on the 12th. During this period, what Tao Bank did was: release the product front-end interface and announced that tokens would be deployed on Arbitrum.

Two days after TBANK was launched, the Tao Accounting System token TAS, positioned as "an experimental token standard on Bittensor", was also launched. Compared with the previous two projects , the "Experimental Token Standard" has no product pictures to post. Just two days after it went online, TAS experienced a sharp rise and fall. During this period, someone in the project team's comment area questioned "the team did not cancel the transaction tax as promised." The team only tweeted that "it will come back after participating in ETH Denver and launch the test network." In this Twitter comment area, KOLs who lead orders account for more than half of the cooperation invitations. It took TAS less than 4 days to achieve an increase of more than 8 times.

Since March, BlockBeats has discovered that projects related to the Bittensor ecosystem are appearing more and more frequently, but the project content and social media operations are becoming more and more random. Life span is getting shorter and shorter. From March 5th to March 10th, 10 project tokens with TAO in their names were listed on Ethereum in five days and appeared on the Dexscreener hot list.

On March 5, the UNITAO token of the Dapp platform positioning the Bittensor ecosystem was launched. It increased 7 times in 24 hours, and then fell by 80% in the following week. TAOx's life was even shorter. It tripled in four days and fell 90% in two days. After UNITAO and TAOx, 8 Bittensor ecological projects emerged in four days, and the transaction volume of most of these projects did not exceed 10M. Tokens derived from "TAO" have experienced a transformation from potential value projects to popular local dog dishes. The token price trend is only the most direct reflection. Jasmine, a contributor to the Bittensor community ecology, once said that she refused to promote Bittensor-related projects. Quotation question.

If they are all local dogs Plate, for investors, can Bittensor, which has great positioning and unlimited potential, only be bought as a meme of the leading project branch under the AI meme? But unlike memes, when the heat is too high, "Don't touch Bittensor" is a safer choice. Many people realize this, "Be careful with tokenized subnets".

Bittensor ecology, unlimited potential Or is it out of reach?

As there are more and more similar projects, the expectations for each project are also dispersed, and the lifespan of new projects is getting shorter and shorter. What's more, after buying project tokens, the team can get transaction taxes no matter whether they rise or fall. How much profit the holder can finally get can only depend on the conscience of the purchasing agent. In other words, the project developers and investors who have emerged in the past month all met through "purchasing agents/crowdfunding into Bittensor". The purpose is to participate in the Bittensor ecosystem and get a share of this leading project in the AI sector with a market value of US$4 billion.

For investors involved in these projects, after experiencing the ups and downs, Bittensor may have reduced from a "value halo" to a "cutting brand". However, as the project with the largest market value in the AI sector, Bittensor’s potential value cannot be ignored. A large part of the reason for such contradictions lies in the difficulty of participating in the Bittensor ecosystem.

Liquidity blocked outside the door

There is nothing more you can do if you are optimistic about a project You can buy its tokens or participate in various gameplays in the project ecosystem, but Bittensor does not seem to welcome retail investors.

Currently, the ways for users to participate in the Bittensor ecosystem include: registering as a subnet, becoming a verifier, becoming a miner, and purchasing TAO to participate in staking. The first three can receive 7,200 TAO allocation incentives from the Bittensor daily market, and can earn approximately 15% of APY by simply participating in staking. Becoming one of the top three also requires staking TAO.

In terms of the option of "holding TAO", TAO itself, which is not an EVM token, is not easy to purchase. Bittensor is built on the Polkadot ecosystem and uses its own independent L1 blockchain based on Substrate. Therefore, when conducting on-chain transactions, most mainstream wallets cannot purchase and hold TAO, and can only store and manage TAO through compatible wallets that support the Polkadot ecosystem.

In addition, in recent months, the emergence of wTAO has largely solved the circulation and holding problems of TAO on Ethereum. However, according to dlnews, the developer behind Tao Bridge, which provides cross-chain services, is only anonymously CreativeBuilds, which is independent of Bittensor and the project itself is closed source. Theoretically, holding wTAO involves the risk of the project side running away.

Subnet Universe and "Bittensor War"

In October 2023, Bittensor passed the Revolution upgrade. This upgrade marks an important milestone in the development of Bittensor. The Revolution upgrade introduces the concept of "Subnets", allowing anyone to create subnets dedicated to specific types of applications and define their independent incentives.

According to TAO’s token economics, 7,200 TAO (approximately US$5.04 million based on US$700) will be mined every day. This part of TAO Will be allocated by the ROOT network to 32 subnets and their miners and validators.

The subnets on Bittensor are highly competitive. In January, the registration threshold to create a subnet was less than 200TAO. In the past three months, the cost of registering subnets has soared, reaching 10,281 TAO on March 10, exceeding US$7 million. If the increase in the token itself is included, the cost of subnet registration alone has increased a hundred times in the past three months.

Successfully registered subnet also It does not mean guaranteed profits. The rising cost of subnet registration means that the number of projects registering subnets is increasing. After sufficient registration fees are available, these projects will release testnets and publish and modulate their own incentive mechanisms on the test chain. Among the 32 subnets, the new subnet will have a 7-day "protection immunity period". After seven days, the subnet with the lowest token allocation will face the result of being cancelled, and will be replaced by the testnet when the testnet meets the requirements.

To become a verification node or miner, in addition to staking TAO, you also need to follow the specific requirements and setup process explained in GitHub for the selected subnet for deployment. . Only the top 64 validators in all subnets by stake will be granted a validator license and marked as active participants.

The daily TAO rewards received by verification nodes and miners are based on their respective contributions and determined by a fixed formula: INCENTIVE * (EMISSION * 0.41) + DIVIDENDS * ( EMISSION * 0.41), where EMISSION represents the share of TAO minted by the subnet, and DIVIDENDS represents the equity percentage weight of all validators in the subnet. Of the total daily allocation, 82% is divided equally between validators and miners, with the remaining 18% going to subnet owners.

Emission also has its calculation formula, and its value is related to the number of validator pledges and the subnet score. According to research by 0xai, an organization focused on the Bittensor community, the top 5 validators control more than 65% of the pledged TAO.

Picture source 0xai, among the top five Validators, τaosτaτs & Corcel, Foundry, and TAO-Validator.com all have significant bias

According to taosat data, among the 7,200 TAOs emitted daily as of the time of writing, subnet 18Cortex. has a stable share of around 10%, while subnet 19 Vision has a share of approximately 10% in the past week. It increased from 7.96% to 8.85%. Correspondingly, the incentive allocated to subnet 08 Time Series Prediction decreased from 8.49% to 6.75%.

In the eyes of the Bittensor community, the high threshold and fierce competition of the subnet can Driving the continuous development of the Bittensor ecosystem, there are many widely circulated "subnet strategies" on social platforms. As for the liquidity issue, the community believes that those protocols that provide proxy deployment nodes or pledges will compete in user profit sharing and stage a "Bittensor War."

Bittensor community sub Internet strategy. Upper left @0xai_devi; Lower left: @xavi3rlu; Right @Richmelon8

It is worthy of recognition that Bittensor has indeed attracted many participants who focus on AI technology. Subnet 18Cortex comes from According to the open source AI research organization Nous Research, the performance of Subnet 9 is said to exceed OpenAI's GPT2 large model. Bittensor has received a lot of recognition for using Web3 to empower AI. When analyzing the combination of AI and Crypto, Vitalik used the case of Bittensor to explain how to use cryptographic incentive mechanisms to create better artificial intelligence products without relying entirely on the use of cryptography.

Vitalik wrote about Bittensor

On March 5, Vitalik was at Bittensor Asia Community Meetup on

However, at least for now and for a long time to come, the Web3 market is pursuing better capital utilization. Delphi Ventures author Tom Shaughnessy writes at When introducing Bittensor, he said, "I think the key to the Bittensot system is how the needs of the subnet are converted into the needs of the subnet token."

Bittensor's "success" comes from its sub-network mechanism. The closed ecology, fierce competition and high entry threshold can screen and gather enough outstanding participants, and it is expected to run better models. From a certain perspective, Bittensor has chosen the relatively realistic path of combining AI xCrypto.

Many current projects in the AI sector are being questioned about decentralization for the sake of decentralization. AI is a field with very cutting-edge development and high technology density. , the traditional major Web2 companies with powerful resources are still struggling. What results can Web3 achieve?

The decentralized incentive market built by Bittensor can, ideally, allow teams interested in researching AI technology to obtain sufficient material based on their abilities. excitation. Through the AI Lego approach, Bittensor drew a product idea for the phrase "AI solves productivity, Web3 solves production relations", and it is still operating normally.

However, the output and application of AI models take a long time to produce results. This is also the reason why AI x crypto was not optimistic in the encryption field in previous years. For encryption that pursues financial efficiency For the market, how to attract liquidity is more important. The Bittensor ecosystem often makes Web3 natives find it "difficult to understand." Miners and verifiers, staking mechanisms, and TAO tokens are all designed to attract more AI developers and, ideally, create better AI. models and products. There are many different subnets in the Bittensor ecosystem, but the progress of the subnets is often only related to verifiers and miners. Investors who hold TAO but are not familiar with AI products seem to only be able to imagine Bittensor in an "unclear" perception. future.

The "local dog project" mentioned above was supported by retail investors who were optimistic about Bittensor but had no way to start. After the popularity of the local dog fades away, is Bittensor closer to the encryption community?

What are the opportunities for TAO?

First of all, Bittensor "believers" and community observers have completely different understandings of TAO's future growth space. On the one hand, observers believe that its price has increased 15 times in the past six months, and its market value has reached the US$4 billion mark, so there is limited room for high-fold increases. However, the Bittensor community believes that 87% of the circulating TAO tokens are being pledged, which means that the actual token circulation only accounts for a small part of the current market value, and TAO still has a lot of room for growth.

In addition, it is undeniable The appeal of Bittensor's name is still there. If you still want to find fast and high returns in the Bittensor ecosystem, looking for projects related to the Bittensor ecosystem that can directly issue coins is still an option. Although it is no longer possible to "guarantee profit with a title", there will still be people paying for the new gameplay and marketing methods.

For example, the project Tao Ceτi (ceti), which was launched on March 11, was authenticated by the founder’s real-name forwarding on the day of launch. Its founder Dennis Jarvis is also Bitcoin.com Former CEO. Although after the project was launched, its official website did not have a project introduction and token economics, but ceti still had a surprising result of increasing by 15 times in three days after going online.

On the other hand, Bittensor has also made some efforts to improve the ecology. In January, the Bittensor Foundation Opentensor Foundation submitted a network upgrade proposal Dynamic TAO (BIT001), which improved the Bittensor network pledge mechanism and the distribution rules of TAO block rewards, and increased the participation of TAO holders in Bittensor block rewards. Distributed power. Most importantly, this proposal proposes a "dual-token mechanism."

Related reading: "Analysis of the network upgrade proposal Dynamic TAO: What impact will it have on Bittensor? 》

According to Taonews’ explanation, the dual-token mechanism means that after the proposal is passed, the tokens of the Bittensor ecosystem will include TAO and new subnet tokens. Tokens, TAO and subnet tokens can be traded. The value of the subnet is no longer only related to validators and miners. Embracing the influence of market factors means lowering the threshold for "speculative" behavior. The Bittensor ecosystem will be more dynamic, but also more complex.

As of this writing, the B1T1 proposal is still under discussion. This weekend, Bittensor's subnet registration threshold was reduced from 10281 TAO to 2016 TAO. Every time a project registers a subnet, the registration cost will double. If no one registers, the price will decrease linearly within four days. Half. In other words, the subnet competition in the Bittensor ecosystem seems to have eased.

The day before yesterday, the Opentensor Foundation It stated on social platforms that the Bittensor roadmap will be announced this Thursday. The NVIDIA Conference is underway, and it is foreseeable that a new wave of AI craze is also coming. Multiple projects are gaining momentum, and only time will tell what role Bittensor will play in them.

Reference reading:

· "Wrapped TAO on Ethereum soars to $82 m—but it’s all controlled by one person", author: Tim Craig, Ryan Celaj

·"Maximizing Your Impact in Bittensor: What You Should Know Before Running a Node ", Author: Xavier Lyu

·"Bittensor’s New Tokenecon Empowers Subnet AI Competition", Author: Tom Shaughnessy, Guest Author (Delphi Ventures)

·"BIT1 Unveiled: Steering Bittensor Towards a Revolutionary Dual-Token Ecosystem", author: tao.news

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