Considered a frontrunner in the intersection between AI and blockchain technologies, Bittensor is an ecosystem that aims to provide developers and users with a transparent and open market for AI and digital commodities like compute and storage.
In this article, we will explore Bittensor's overarching vision, its operational mechanisms, and the significant role TAO plays in the ecosystem.
Overview
Similarly to how Bitcoin opened up a new paradigm for money and gave financial power back to everyday people, Bittensor's vision is to create a market for artificial intelligence that is fair, transparent, and accessible to everyone.
Because training AI models requires vast resources, this technology is mainly accessible to large corporations and research institutions. This problem sits at the core of what Bittensor aims to solve.
Bittensor is an open-source network that resembles a global digital computer.
It allows developers to build permissionless applications that would otherwise be impossible due to capital, access, or other constraints. Thanks to a token-based economy, developers are incentivized to contribute to the ecosystem and, in return, receive rewards based on their quality of work.
Initially, Bittensor was built solely for machine learning operations. Over time, the network has evolved to facilitate a marketplace for Intelligence and any other digital commodity, such as computing power or storage.
How it works
This global computer comprises multiple parts that work in tandem to deliver users the desired outcomes via applications, whether it's 3D render work, storage, AI inference, or any other task.
To achieve this, Bittensor has devised a sophisticated system of various components, of which the following form the nucleus:
Subnets
A core characteristic of Bittensor is its incentive-based competition mechanism, which takes the form of subnets. Each subnet hosts its own rules and parameters within a self-contained codebase, along with distinct miners and validators, enabling a broad design space for developers.
Consider each subnet as a separate state and the Bittensor network as the United States of America, with each state contributing to the overall value and quality of life for its citizens.
Similar to how individual states establish their laws and offer specific advantages such as tourism, favorable tax legislation, and business opportunities, subnets also have their own distinctive characteristics and benefits.
For example, Subnet 1 (alpha) defines an incentive mechanism to create a distributed conversational AI. Subnet 19 (tau), however, is focused on inference at scale, with an initial focus on image generation & manipulation models.
From May 2024 to July, the network's subnet count increased from 32 to 64, with an average of 4 new subnets added weekly.
Subtensor
The subtensor is the heart of the network. It is a decentralized blockchain that records the critical activity of all the subnets and determines the reward distribution for subnet miners and validators.
The Yuma Consensus monitors the network and computes the rewards block-by-block every 12 seconds.
The network has undergone several iterations that have addressed issues regarding performance and underlying consensus:
- January 2021: Launch of the first iteration of the main Bittensor network, codenamed ‘Kusanagi.’
- May 2021: Halt of Kusanagi to address early consensus issues.
- November 2021: Fork of Kusanagi and launch under the new codename ‘Nakamoto.’
- March 20, 2023: Final fork of Nakamoto to address performance issues leading to the latest iteration, ' Finney.’
Bittensor API
The Bittensor API is the glue connecting all the essential elements, providing much-needed communication between the subnets, nodes, wallets, and the blockchain.
One of the API's most crucial functions is enabling subnet owners to write their incentive mechanisms.
TAO tokenomics
TAO functions as the primary financial tool for network participants, facilitating governance, staking, and payment for AI services and applications within the network.
The token was fair-launched, meaning there were no pre-mined tokens or ICOs.
The token is available on the largest centralized exchanges, such as Binance, Kucoin, Bitget, and others.
For die-hard cypherpunks, the native coin can be obtained through the Bittensor Exchange. An Ethereum-wrapped version is also available on Uniswap, courtesy of Tensorplex Labs.
TAO's tokenomics design mimics Bitcoin's, with a total supply of 21 million coins gradually released through mining and staking rewards.
Bittensor also employs a halving principle where TAO emissions are reduced by 50% roughly every four years.
The first halving is scheduled to occur on October 24, 2025.
How to buy TAO?
There are two ways you can go about buying TAO. You can use the centralized path or the decentralized path.
Let’s start with the centralized exchange (CEX) route.
TAO is available on most major exchanges, including:
- Binance
- Kraken
- Gate.io
- Kucoin
- MEXC
- Bitget
- Crypto.com
Now, you may have noticed that some big players like Bybit, OKX, and Coinbase are not here. At the time of writing, they are not available on these platforms, but there is a high likelihood it will be listed in the near future.
Once you log in to your account on one of the respective platforms, you must navigate to that exchange’s spot market. On desktop, this can typically be found in the panel at the top of your screen, and on mobile, there is usually a drop-down list on the left side of your screen.
Once you’re at the spot market. Hover over the token tab and search for “TAO”. Once you do that, simply select the quantity you want to buy and click on the green button to buy yourself some TAO.
After this, you can take the risk and leave your TAO on the exchange, but we always recommend self-custody.
To do this, you can create an on-chain wallet. The best wallet, as recommended by Bittensor, is the Polkadot.js wallet, which you can create by clicking this link and following the steps.
Once you create this wallet, you can withdraw your assets from the CEX to this wallet, and just like your assets are in self-custody.
The second way is the decentralized exchange (DEX) route.
The main way to get TAO fully on-chain right now is on the Ethereum network.
If you go to Uniswap and input the following token address: 0x77E06c9eCCf2E797fd462A92B6D7642EF85b0A44, you will be able to buy wTAO.
All you have to do is swap your ETH for wTAO, and just like that, you have purchased TAO.
wTAO is a wrapped version of TAO for the Ethereum mainnet. So, if you are purely buying TAO for price movement, you can leave it on the Ethereum mainnet itself.
However, if you want to use your TAO or are afraid of wrapping contract risks, you can also bridge your TAO.
To do this, go to Taobridge.xyz, connect your wallet, and transfer your wTAO from your Ethereum wallet to your TAO wallet. It’s that simple.
Company and backers
Bittensor was founded in 2019 by Jacob Robert Steeves and Ala Shaabana.
The team comprises over 30 talented people, including ex-Google employees and researchers.
Even though the project was fairly launched, prominent crypto VC firms have obtained a substantial stake in the network by purchasing TAO from the market.
Polychain, a VC firm that incubated the project in 2019, holds around $200 million in Bittensor's token. Digital Currency Group, another prominent VC firm, has roughly $100 million in TAO.
Final thoughts
The AI models we use today are run by a few conglomerates that ultimately decide what information is correct, acting as gatekeepers.
As we move toward the digital age, it will become increasingly crucial for humanity to have the necessary tools to receive transparent and unbiased information.
Bittensor not only stands as one of the most potent weapons against censorship but also provides a vast and expansive design space for developers to utilize the latest advancements in machine learning technology.
