Crypto’s other halving: Bittensor’s first 4-year cycle seen as ‘maturation’ milestone

With Bitcoin now in its fourth quadrennial halving, other decentralized projects have adopted similar supply-cut cycles — and Bittensor is approaching its first since launching in 2021.

Bittensor, a decentralized, open-source machine-learning network built around specialized “subnets” that incentivize marketplaces for AI services, is expected to undergo its inaugural halving on or around Dec. 14. At that point, issuance of its native token, TAO (TAO), will drop to 3,600 per day from the current 7,200.

Grayscale Research analyst William Ogden Moore called the event a “key milestone in the network’s maturation as it progresses toward its 21 million token supply cap,” matching Bitcoin’s (BTC) fixed limit.

Digital-asset investors and network participants often view a hard-capped supply as a potential value catalyst: if adoption grows and token demand rises, a finite issuance model can be more appealing than pre-mined tokens or fiat currencies with effectively unlimited supply.

Cointelegraph reported on Bittensor in May during a conversation with DNA Fund’s Chris Miglino, whose AI compute fund is heavily involved in the Bittensor ecosystem.

“The biggest thing that we’re working on in the whole ecosystem is our AI compute fund, where we’ve been entrenched into the TAO ecosystem,” Miglino said.

Related: 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,” since each operates like a startup building a specialized product or service.

CoinGecko currently lists over 100 Bittensor subnets, with a combined market cap exceeding $850 million. Taostats, which tracks the ecosystem more comprehensively, shows 129 subnets with a total market cap closer to $3 billion.

In either case, subnet valuations have grown significantly since launch, according to Grayscale Research. The largest include Chutes, which provides serverless compute for AI models, and Ridges, a subnet focused on crowdsourcing the development of AI agents.

The expansion underscores growing demand for decentralized AI infrastructure as developers race to build and scale new AI products and applications.

As Miglino told Cointelegraph, decentralized AI may prove to be blockchain’s most significant use case since Bitcoin, driven largely by that demand.

Related: VC Roundup: Big money, few deals as crypto venture funding dries up