TAO Climbs as Grayscale Files First U.S. Bittensor ETF Amid Halving Scarcity

• Grayscale filed for the first U.S.-listed ETP tracking Bittensor's TAO token, seeking to convert its existing trust into a spot ETF.
• TAO's first halving in December 2025 cut token emissions by 50%, reducing annual inflation to 13% and mirroring Bitcoin's scarcity model.
• The token jumped 9.55% on January 2 amid technical indicators signaling a potential breakout toward $285.
• Institutional products and reduced token supply create structural support for TAO despite near-term technical resistance.

Bittensor's TAO token faces a pivotal moment as regulated access converges with tightened tokenomics. Grayscale's landmark ETF filing aims to bridge institutional capital with the decentralized AI network's native asset while the protocol's first halving constrains new supply. Technical charts show TAO testing crucial resistance after a 9.55% single-day surge, leaving traders watching the $200-$210 support zone. Market participants now weigh immediate catalysts against structural shifts in evaluating TAO's positioning.

How Could Grayscale's ETF and Trust Catalyze Institutional Adoption?

Grayscale seeks to convert its existing Bittensor Trust into a spot ETF trading under ticker GTAO on NYSE Arca. The proposed product would leverage Coinbase as custodian using in-kind creation mechanisms designed to minimize premiums versus net asset value. Approval would mark the first U.S.-listed exchange-traded product for an AI-native crypto asset beyond Bitcoin and Ether, potentially lowering barriers for traditional investors. Grayscale's existing OTC-traded trust reported a $7.96 net asset value per share with a 2.5% expense ratio as of January 5. Such regulated vehicles could expand TAO's investor base amid growing institutional interest in crypto assets beyond major coins.

What Impact Did the Halving Have on TAO's Tokenomics?

Bittensor completed its inaugural halving on December 14, 2025, reducing daily TAO emissions by 50% and slashing annual inflation to approximately 13%. This event fundamentally altered the token's supply dynamics by introducing artificial scarcity comparable to Bitcoin's model. The protocol's maximum supply remains capped at 21 million TAO, with the halving incentivizing network contributors through enhanced token scarcity. Revenue-generating subnets like Targon, which reportedly produces $100 million in annualized income, compound this effect by driving real utility demand. Reduced new issuance coincides with growing institutional adoption pathways that could structurally support valuations long-term.

What Do Technicals Suggest for TAO's Price Trajectory?

TAO surged 9.55% on January 2, pushing its price near $242 with trading volume climbing 42% to $89.87 million. Analysts observed a breakout from two-week consolidation around $207, with a decisive close above $235 potentially triggering an 18% climb toward $285. Current charts show TAO testing the $260.75 Ichimoku Kijun line while wrestling with bearish pressure from the 200-day simple moving average at $351.55. The token's RSI reading near 31.85 signals oversold conditions though lacks confirmation through bullish divergence. Critical support sits between $200-$210 where failure could trigger downward moves toward $215. Market sentiment remains torn between immediate ETF prospects and lingering technical headwinds.