Bittensor, a decentralized, open-source machine-learning network, is approaching a significant milestone: its first halving event. Expected to occur around December 14, 2025, this event marks a key moment in the network's maturation. The halving will reduce the issuance of its native token, TAO, from 7,200 per day to 3,600.
Like Bitcoin, Bittensor follows a four-year halving cycle and has a maximum supply of 21 million tokens. However, unlike Bitcoin, where halvings are based on block count, Bittensor's halving is triggered by the total TAO supply in circulation. This halving is viewed by digital-asset investors and network participants as a potential catalyst for value, due to the capped supply. If adoption grows and token demand rises, the finite issuance model may become more appealing.
The halving's impact extends to the incentives for network participants. TAO emissions incentivize miners to produce AI-related digital commodities like compute power or data storage. The reduction in supply will lower emissions to network participants and increase TAO's scarcity. Despite the smaller rewards, Bitcoin's history suggests that reduced supply can enhance network value, as its network security and market value have strengthened through successive halvings.
Bittensor functions as a "Y-Combinator of Decentralized AI development," using TAO to fund the development of specialized "subnets". These subnets incentivize marketplaces for AI services. CoinGecko lists over 100 Bittensor subnets, with a combined market cap exceeding $850 million. Taostats, which tracks the ecosystem comprehensively, shows 129 subnets with a total market cap closer to $3 billion. Subnet valuations have grown significantly since launch, indicating rising demand for decentralized AI infrastructure as developers build and scale new AI products and applications.
Grayscale Research believes that the reduced TAO supply growth and increased TAO demand could positively catalyze the Bittensor ecosystem. This halving coincides with increasing developer engagement and rising institutional interest in the network. The halving is expected to enhance the scarcity of TAO, potentially driving up demand as the network expands its decentralized AI services.
The largest subnets include Chutes, which provides serverless compute for AI models, and Ridges, a subnet focused on crowdsourcing the development of AI agents. In February 2025, Bittensor introduced Dynamic TAO, where each subnet has its own Alpha token that trades against TAO in decentralized markets. Both TAO and Alpha tokens follow the same halving schedule, with each subnet emitting 1 Alpha token per block, halved alongside TAO.
While the halving is generally viewed positively, some concerns exist. The decrease in rewards for network contributors may disincentivize some as their payouts decrease. As this is the first Bittensor halving, its precise impact remains uncertain. Two factors can potentially delay the halving date: TAO spent on miner registration being returned to the network, reducing the circulating supply, and the introduction of Alpha tokens and shifting network activity.
