Bittensor (TAO) Surged Amid AI Infrastructure Demand and Supply Reduction

• Bittensor's TAO token surged following a supply halving that reduced emissions by 50%, increasing scarcity and staking rates above 75%.
• Institutional interest and subnet usage growth of 34% highlight Bittensor's potential in decentralized AI infrastructure.
• TAO's recent price increase is attributed to a post-halving supply shock and increased staking demand, with nearly 75% of tokens staked.

Bittensor's TAO token has seen a surge in value due to a supply halving event that cut daily emissions by 50%, leading to increased scarcity and staking rates above 75%. This structural change has heightened price sensitivity to demand fluctuations, especially as subnet usage rose by 34%. Institutional activity, including ETF filings, supports the narrative, while analysts project a $450–$850 price range if subnets scale to 256 by 2026.

The token's recent price increase is attributed to a post-halving supply shock and increased staking demand, with nearly 75% of TAO tokens now staked. This has enhanced the token's price responsiveness to demand fluctuations. Positive developments in the AI sector, including subnet usage growth of 34%, have further strengthened the narrative. The token remains more than 50% down year-to-date, underscoring the importance of continued adoption and scalability to maintain long-term relevance in the market.

Bittensor's TAO supply increase is part of a scheduled emission process that distributes new tokens to validators and contributors, supporting network growth. While short-term supply growth can pressure prices if demand stalls, on-chain metrics show TAO moving off exchanges into private and staking wallets, reducing liquid supply and aligning with patterns of strategic accumulation. Bittensor's tokenomics mirror Bitcoin's scarcity model, with halving cycles and a fixed supply cap.

What Structural Changes Affect TAO's Supply and Demand Dynamics?

Bittensor's supply and demand dynamics are influenced by scheduled emissions that distribute new tokens to validators and contributors. These emissions are part of a structured framework that supports long-term network growth and institutional confidence in the token's economic model. The recent supply increase is not an unexpected expansion beyond the 21 million cap, but a part of the scheduled emissions.

The 50% emission halving in December 2025 reduced daily supply and increased staking demand and scarcity. Additionally, the expansion of Bittensor's subnet count to 32 has enhanced utility demand. These developments attracted both retail and institutional investors and boosted on-chain activity.

What Market Access and Institutional Moves Have Influenced TAO's Performance?

Bittensor's TAO price rose nearly 8% following its listing on Upbit, South Korea's largest exchange, expanding trading pairs and market access. This event is seen as a catalyst for localized demand in the Korean market. The listing on Upbit increases visibility and potential demand from Asian capital pools, with historical evidence showing such listings often bring higher liquidity and trading volume.

Institutional accumulation is indicated by TAO moving off exchanges into cold storage and rising staking participation, which locks tokens away from immediate sale. These movements reduce liquid supply and limit immediate sell pressure, even with gradual supply growth. Bittensor's listing on Upbit in South Korea increases visibility and potential demand from Asian capital pools.

What Are the Risks and Limitations in Bittensor's Narrative?

Despite recent gains, TAO remains down over 50% year-to-date, emphasizing the need for continued innovation and adoption to sustain relevance in the AI sector. Risks include a 54% non-circulating supply and centralized competition. Short-term price volatility is influenced by profit-taking and trading restrictions imposed during the initial listing phase.

The structured emission framework supports long-term network growth and institutional confidence in the token's economic model. However, the increase in supply is part of a scheduled emission process, and institutional accumulation is indicated by TAO moving off exchanges into cold storage and staking activity. These movements reduce liquid supply and limit immediate sell pressure, even with gradual supply growth.