Bittensor: everything you need to know about TAO

What is Bittensor?

Bittensor is a crypto project that combines blockchain and artificial intelligence. The network works as a kind of marketplace where parties offer AI services, such as text generation, model training or providing computational power.

Other participants in the network assess the quality of this output. Based on that, Bittensor determines which contributions are most valuable and who is rewarded for them. Instead of a single central company steering everything, this creates an open system in which multiple AI models compete and collaborate. The network runs on its own blockchain, Subtensor, with TAO as its native token.

How does Bittensor work?

Within Bittensor, miners and validators work together to execute and evaluate digital tasks. Miners provide the work, such as AI responses or computing power, while validators check how well that output is.

Based on those assessments, the network determines who adds the most value. This is done through a mechanism called Yuma Consensus, which collects the input of validators and uses it to distribute rewards. Validators who consistently give good assessments thereby gain more influence.

Bittensor’s blockchain, Subtensor, tracks who has contributed what and ensures that rewards are automatically and transparently distributed.

The TAO token

TAO is the native token of Bittensor. The network uses TAO to reward participants for work that adds value. This applies to miners, validators, stakers and subnet creators.

Users can also stake or delegate TAO to validators. In doing so, they support validators within the network. The amount staked plays a role in their position and in their share of the rewards.

TAO also has a limited supply reminiscent of Bitcoin. The issuance decreases over time and ultimately stops at a maximum of 21 million TAO.

The technology behind Bittensor

The technology behind Bittensor is centered on one clear idea: not locking AI into a single closed system, but distributing it across an open network.

An important difference compared to many other crypto projects is the subnet structure. Subnets are separate components within the network, each with its own task, such as generating AI output, training models, or providing computing power. Bittensor is thus not a network with a single application, but a base layer on which multiple specialized AI markets can run side by side.

Also, Bittensor not only looks at computing power but especially at the usefulness of the output. The network therefore does not simply try to reward computers that do a lot of work, but systems that deliver useful results. That makes it different from a regular marketplace for cloud or computing power.

The Bittensor ecosystem

The Bittensor ecosystem includes, among others:

• Subnets for AI inference
• Subnets for AI training
• Infrastructure for compute and storage
• Tools for validators, miners and developers
• Experimental markets for other digital services besides AI

Advantages of Bittensor

• Open market for AI: Bittensor wants to make AI less dependent on a small number of big players by using an open network of providers and evaluators.
• Flexible subnet structure: The network can run multiple specialized markets side by side, making it easier for new applications to emerge.
• Own blockchain and token model: Bittensor has its own infrastructure with Subtensor and TAO.

Disadvantages of Bittensor

• Success depends on subnet quality: The model works especially well when subnets deliver truly useful services and validators that can make sound assessments.
• Still very much in development: The network has already gone through several major iterations, which shows that the project is still highly dynamic.
• Competition in AI and crypto: Bittensor operates in two rapidly changing markets simultaneously: AI and blockchain. This leads to intense competition.

Who is the founder of Bittensor?

Bittensor was founded by Jacob Steeves and Ala Shaabana.