Bitcoin is currently undergoing its fourth quadrennial halving, and other decentralized projects have adopted similar supply reduction cycles, with Bittensor nearing its first halving since its launch in 2021.
Bittensor, a decentralized open source machine learning network built around specialized “subnets” that power the market for AI services, is expected to undergo its first halving on or about December 14th. At that point, issuance of the native token, TAO (TAO), will decrease from the current 7,200 to 3,600 per day.
Grayscale Research analyst William Ogden Moore called the event “an important milestone in the network’s maturation as it moves toward a 21 million token supply cap,” comparable to Bitcoin’s (BTC) fixed limit.
Digital asset investors and network participants often view hard-capped supply as a potential value catalyst. If adoption grows and demand for tokens increases, a finite issuance model could become more attractive than a virtually unlimited supply of pre-mined tokens or fiat currencies.
Cointelegraph reported on Bittensor in May in a conversation with Chris Miglino of DNA Fund, whose AI computing fund is heavily involved in the Bittensor ecosystem.
“The biggest thing we’re working on across the ecosystem is the AI Compute Fund, which is firmly embedded in the TAO ecosystem,” Miglino said.
Related: Grayscale introduces Bittensor and Sui Trust products
Bittensor subnet details
Grayscale describes Bittensor’s subnets as a kind of “Y Combinator for decentralized AI networks.” Because each operates like a startup building a specialized product or service.
CoinGecko currently lists over 100 Bittensor subnets with a total market capitalization of over $850 million. Taostats, which tracks the ecosystem more comprehensively, shows 129 subnets with market capitalization close to $3 billion.
In both cases, the subnet’s reputation has increased significantly since its inception, according to Grayscale Research. The largest include Chutes, which provides serverless computing for AI models, and Ridges, a subnet focused on crowdsourcing the development of AI agents.
This expansion highlights the growing demand for decentralized AI infrastructure as developers race to build and scale new AI products and applications.
As Millino told Cointelegraph, decentralized AI is primarily driven by demand and could be the most important use case for blockchain since Bitcoin.
The Bitensor subnet is also attracting venture capital. Inference Labs recently closed a $6.3 million round to support Subnet 2, a Bittensor marketplace for inference verification.
Meanwhile, xTao, an infrastructure developer building tools and services for the Bittensor ecosystem, began trading on the TSX Venture Exchange as a newly public company in July.
Related: VC Roundup: As funding for virtual currency ventures dries up, there are few large funds and transactions.
