Grayscale Investments Focuses on Decentralized AI with Bittensor Trust ETF Filing

Grayscale Files for Bittensor ETP on NYSE Arca

Grayscale Investments has filed with the U.S. Securities and Exchange Commission (SEC) to list an exchange-traded product (ETP) for Bittensor’s TAO token on NYSE Arca under the ticker GTAO according to reports. The filing marks a strategic move by the digital asset manager to expand its product offerings into decentralized AI. This follows the launch of its TAO trust in 2024, which was initially traded on the OTCQX market.

TAO has shown substantial volatility in 2025, reaching a peak of over $560 in January before retreating to $220 by April. At the time of the filing, the token was valued at $222.54. This volatility reflects the speculative nature of the AI-linked crypto market, which has seen growing institutional interest in recent months.

Grayscale’s proposed ETP aims to bring TAO to a broader investor base by listing it on a major exchange. The transition from OTC to NYSE Arca is expected to enhance liquidity and accessibility for institutional investors. Similar conversions have been successful for Grayscale’s Bitcoin and Ethereum products.

Why Did This Happen?

Grayscale’s filing followed Bittensor’s first halving event in mid-December 2025. The halving cut daily TAO emissions from 7,200 to 3,600 tokens, reducing supply and potentially increasing scarcity. This aligns with Grayscale's strategy to capitalize on structural supply-side changes in the crypto market.

The timing of the filing is significant. Grayscale has been diversifying its crypto offerings beyond Bitcoin and Ethereum, seeking to position itself in emerging sectors like AI-linked tokens. Bittensor operates as a decentralized machine-learning network, which offers an infrastructure where developers are rewarded in TAO for contributing to AI services.

How Did Markets Respond?

TAO's price increased following the announcement, climbing to $220.77 and rising 1.05% over 24 hours. This suggests that investors are factoring in the potential for increased institutional demand if the ETP is approved. The broader AI-crypto market is also gaining traction, with projects like Fetch.ai and Ocean attracting attention.

The filing has drawn comparisons to the success of Grayscale’s Bitcoin and Ethereum trusts, which have become major assets in the crypto space. If the ETP is approved, it could open a new channel for institutional capital to enter the decentralized AI sector.

What Are Analysts Watching Next?

The SEC’s approval process is the next key variable. Grayscale has previously converted its Bitcoin and Ethereum trusts into ETFs, but this would be the first time for a TAO-linked product according to reports. Analysts are monitoring the regulatory timeline, with potential approval expected in mid-2026.

Institutional adoption of AI-linked tokens is still in its early stages. Grayscale’s ETP could help standardize investment vehicles for these assets, making them more accessible to a wider range of investors. This would mirror the trend seen in the broader crypto market, where exchange-traded products have driven liquidity and price stability.

The ETP will not include staking rewards at launch. However, the trust may consider staking in the future if regulatory conditions permit. Coinbase and BitGo are serving as custodians, ensuring that the trust maintains institutional-grade infrastructure.

Bittensor’s role in the AI-crypto stack is also being evaluated. The network functions as a decentralized marketplace, where AI models are ranked and rewarded based on performance. This model differs from traditional smart-contract platforms, offering a unique value proposition for AI infrastructure.

The success of the ETP will depend on both regulatory developments and market demand. If approved, it could position Bittensor as a leading AI token in the U.S. institutional market. This, in turn, could influence the broader narrative around AI-linked assets, potentially attracting more investment in the sector.

TAO’s path ahead remains uncertain, but the filing by Grayscale represents a significant step toward mainstream adoption. Investors are watching closely to see how the ETP performs and whether it can replicate the success of Grayscale’s earlier crypto products.