The Halving Begins as Bittensor Ends Its First Four-Year Cycle
The halving reduces issuance for the first time since the network’s fair launch in 2021. The new issuance pace brings the system closer to its 21 million token cap. The network functions as an open marketplace where users contribute “intelligence” to improve AI systems.
These contributions are rewarded in TAO tokens based on measurable utility. The platform currently operates 129 active subnets that provide compute, data storage, AI agents, and deepfake detection tools. Each subnet performs its own specific task, supporting the network’s overall “intelligence layer.”
Grayscale Research analyst Will Ogden Moore noted that the supply reduction follows a pattern previously observed in Bitcoin. “Bitcoin’s history shows that reducing supply can increase network value even as rewards decline,” he said. According to Moore, Bittensor is taking an important step toward long-term maturity as it approaches its fixed issuance limit.
Supply Shock Coincides With Network Growth and Institutional Demand
The halving initially creates a substantial supply shock for TAO: new tokens will be minted at only half the previous rate. Annual inflation after the event is expected to be around 1.3%, below Bitcoin’s inflation rate. Meanwhile, demand for subnets continues to grow, mainly because emissions are increasingly redirected toward rewarding verifiable utility.
Subnets that deliver real output attract more stake and receive larger rewards. Next year, assuming demand remains strong, subnets focused on AI inference, prediction markets, and synthetic data generation could become key drivers of further network expansion. Institutional interest is also intensifying. Moore pointed to strong adoption of the network following the launch of a new investment vehicle.
In February, the TAO (dTAO) product made subnets directly investable. Funds such as Yuma Asset Management and Stillcore Capital have already taken positions in leading subnets, while three publicly traded companies have created TAO treasuries. TAO Synergies, for example, holds around 12 million USD worth of the token. This trend reflects growing corporate participation as the network scales.
Network Roadmap: TAO Integrates Deeper Into the Crypto Ecosystem
Bittensor is moving toward EVM compatibility. The upgrade will open the network to a broader range of developers and applications. It may also lay the groundwork for liquid staking, lending markets, and cross-chain activity in 2026. The network plans to expand decentralized AI throughout 2026 based on the updated rewards model.
This model channels emissions toward high-quality, “sound” output in order to strengthen subnet performance as adoption grows. With the supply shock approaching, a key question emerges: can rising demand offset reduced issuance as the network scales its decentralized AI ecosystem?
TAO Market Strengthens Ahead of the Halving
At the time of writing, TAO is trading at 291.17 USD, up 3.16% over the day amid a volatile session. Market capitalization has risen to 3.04 billion USD (+3.23%), while the market cap of unlocked tokens has reached 3.12 billion USD. Trading volume has climbed to 130.48 million USD (+73.21%), pushing the volume-to-market-cap ratio to 4.28%.
The token’s maximum supply remains capped at 21 million, with 10.45 million TAO currently in circulation. The platform assigns the project a profile score of 74%. The chart showed intraday lows near 270 USD followed by a recovery above 291 USD, with sharp swings between red and green zones throughout the trading session.
The upcoming halving will introduce a decisive reduction in TAO supply at a time when network adoption, institutional demand, and subnet expansion are all accelerating. Taken together, these factors create a structurally tighter market environment that could significantly influence Bittensor’s long-term growth trajectory, analysts at FORECK.INFO concluded.