[00:01] own any Tao today. But for years now, every single time serious people talked about the future of AI and crypto, Bittensor's Tao kept coming up. People call it the Bitcoin of AI. They said it could become the next open marketplace
[00:15] always been interested in Bittensor's Tao, but I've never really understood what it was. Like what it like what does it actually do in terms of like AI and crypto? And I've always kind of felt like maybe it was a little bit gimmicky
[00:29] or just you know, another one of those crypto tokens that makes really big promises, but really you know, it's all smoke and mirrors behind the scenes. But Bittensor's Tao keeps coming up. And I listen to All-In podcast like weekly and
[00:43] Jason brings up Tao every single time that they talk about AI. And historically, he's never been a huge fan of crypto. He's the one famous pivot to AI." But for some reason, he's
[00:55] not the only one. There's a lot of people that are obsessed with this project. So, I finally sat down and actually dug into the project. And surprisingly, I was actually insanely impressed by what Bittensor has built.
[01:09] The Bitcoin of AI is actually a really good description of what Bittensor is deeper and more interesting than I expected. So, in this video, I'm going to explain Bittensor and Tao as simply as possible. Show you why people are so
[01:23] excited about this project, break down both the bull and the bear cases for Tao the token, and answer the question, "Was all this enough to actually get me to buy some Tao and put my money where my mouth is?" Okay, so this is Bittensor's
[01:37] here because there's literally almost one of the reasons that I thought that this project really didn't have any a pretty boring website. And you know, there's a lot of kind of lower quality
[01:51] crypto projects that do similar abstract kind of things just to hide the fact anything behind the scenes. And to really explain what Bittensor is, we got to start first with the problem that Bittensor is trying to solve. Imagine
[02:05] developer, and you want to build your own AI model or, you know, some sort of basically you can go get hired by one of these frontier companies like OpenAI or Google or Anthropic. Or, if you want to
[02:18] millions from VCs and start your own company. And And those are really your you were able to build a really good product, nobody can find you. You have no distribution for that product, and it's going to take a long time for you
[02:30] which means, you know, a lot of these projects can go under before they really even get started, especially in decentralized AI, open-source AI, think actually are really, really important for the overall health of AI,
[02:45] going to have a superintelligence smarter than every human on Earth. You kind of would hope that that would be, you know, owned by humanity. It'd be an open-source resource, kind of like the internet, um and a lot of these other
[02:57] Ethereum and and different things like that. And the way that Bittensor decided really interesting, and one of the biggest things that I was actually confused about when it came to Bittensor originally. Originally, I thought of
[03:10] Bittensor as like this one project that was doing some sort of AI model, maybe decentralized AI model or or something like that. I I really didn't understand anything about it. But, it's actually not one AI model or even one AI
[03:22] business. It's actually a whole range of different subnets uh that are each their own individual AI businesses. And these range from a ton of different things, like no single one is exactly the same. The biggest one is something called
[03:35] Shoots, which is breakthrough serverless compute for AI at scale. So, it's all play for AI. And you can actually see right here that Shoots has made over $5 million in platform revenue over just the last year alone. And this isn't Tao.
[03:48] This is just one subnet on Bittensor, on Tao. Other subnets would be things like this one, Minos, the foundational This background's crazy. The foundational layer of genomics. This is subnet 120. It looks like it's a model some sort of
[04:03] open-source model maybe of some sort. I can't really tell. This is another subnet, Iota or macrocosm. I don't know actually which one the name is, but it objective of project Orion is to show that distributed heterogeneous
[04:18] competitive economic alternative to training in a centralized context. So, just on a decentralized scale versus training um centralized, which is a the idea. BitTensor is actually made up of a marketplace of different AI
[04:33] projects. And they're actually all competing against one another to get the funding and um issuance that comes from BitTensor. And a couple important don't need to have permission to come compete in this. If you build something
[04:46] genuinely amazing, you have something genuinely amazing in the AI space you're building, you come to BitTensor, compete to have a place as a subnet, um you're going to get issuance from BitTensor in the same way that Bitcoin miners get
[04:59] issuance for supporting the Bitcoin network. And let me say that again because that's really a core aspect of what makes BitTensor BitTensor. Bitcoin network. That's the whole point of Bitcoin miners. People set up these
[05:13] really complex GPUs. They have to hook it up to these like huge power sources that cost a lot of money to buy and set these things up, but a lot of people do it because they make money mining Bitcoin. The way that BitTensor works is
[05:25] really similar, but instead of solving really hard math problems, each subnet is solving really hard AI problems. As in they're building an AI business and competing against each other to hold those subnet spots. And the better your
[05:37] business, the more it's perceived to be valuable by the market, the more Tao actually really cutthroat. If you suck at what you're building, you can get replaced and then pushed out, so you're not earning rewards anymore. And so, the
[05:50] best of the best are rise to the top and they're constantly all competing to hold their spot and continue to earn that Tao, which is extremely valuable, just valuable. So, Bittensor basically allows
[06:02] open source or decentralized or independent AI developers to earn money without going down the traditional paths by competing in the Bittensor as I mentioned earlier, to something like YouTube.
[06:14] >> YouTube doesn't fund a creator as like a media company in the traditional sense. YouTube, you had to have a media company, you had to get funding, you had all this kind of crazy stuff, and then you still had to secure a slot on some
[06:28] process and really limited the amount of people that could participate in media to just a select few. And YouTube really flipped that on its head. YouTube is basically the same thing Tao is or Bittensor is. You have a marketplace for
[06:42] constantly competing to get recommended in the YouTube algorithm to get the kind of stuff so they can earn ad revenue and people's attention and sell their products or whatever. And some of the biggest media companies and creators
[06:56] in the world today are, you know, the result of YouTube. And I don't think Mr. Beast would exist as he is today without YouTube having been a marketplace where he could have competed. And today, Mr. Beast reaches a larger global audience
[07:09] than virtually any TV show or program on air today. Often by several times over. Like he gets more views and attention than just about anyone on Earth. What YouTube did for creators, Bittensor wants to do for AI builders. It's
[07:23] the obvious objection is that, you know, building an AI company or a new AI model just filming yourself on a video and uploading the content. But we've platform doesn't have to make the work easier. It just has to remove the
[07:38] barriers around that difficult work. For example, the App Store, when it came around, it didn't make writing software easy, but it spawned a whole wave of software app businesses that were able to finally ship games or whatever
[07:51] Bitcoin may be the strongest answer to any sort of objection that like, oh, doesn't work for AI. As I mentioned earlier, running a Bitcoin miner or a Bitcoin miner company is insanely expensive and technically challenging.
[08:05] machines to secure money, you have these extremely sophisticated operations all network. BitTensor does the same thing, but instead of securing money, it produces intelligence. Now, Tao is the token behind BitTensor and a lot of
[08:20] people wonder, how does that fit into the wider ecosystem? And basically, the Bitcoin of BitTensor and that really is the best answer for that question. Although, there's a lot more nuance to it versus Bitcoin. I mean, there's a lot
[08:33] little bit different. In the exact same way Bitcoin was used to bootstrap the Bitcoin network, as I've talked about over and over again at over the course of this conversation, Tao is used to bootstrap the Tao network or the
[08:47] BitTensor network, the BitTensor economy. GPUs, electricity, servers, building an AI model, all this kind of stuff is extremely expensive and you need funding for it. And the whole idea behind it is that Tao pays for all of
[09:01] exist. I I'm starting to say this over and over understand it. Instead of Bitcoin going to Bitcoin miners to support the network, Tao goes to Tao builders to support the Tao network or, you know,
[09:16] whatever you want to call it. And honestly, this is one of the most BitTensor and Tao is like, that's the bootstrapping like the cold start problem. How do you get this going in
[09:28] the first place? And BitTensor has already gotten over that hurdle because project, which means Tao is already valuable. Like, when they're, you know, it's already enough to attract builders to come to the network and build because
[09:41] serious rewards in coming and joining and becoming one of these subnets. So, economy. Now, it's more of a question of like, is that economy and all these useful? We already know that Shoots is doing $5 million a year. So, we we at
[09:56] least have one example of one company being kind of useful. Uh the broader more of these companies end up being just as useful or more useful in the long term. And this is where things get kind of confusing and I I'll try to
[10:09] basically, all these subnets have these things called alpha tokens. And the way you get those alpha tokens is you exchange Tao for the alpha tokens. And It's really similar. I guess the easiest
[10:22] Ethereum where you have all these apps built on Ethereum. And, you know, in most cases, especially early on, uh you were exchanging ETH for those tokens, right? So, like back in the early days of crypto, you'd hold ETH and you'd use
[10:36] that ETH to go buy, you know, whatever the Obey token or, you know, whatever. You have to exchange Tao to get the alpha tokens. And a lot of people seem to use like an index like argument for Tao. Basically, like there's 128 of
[10:49] own all of them. You don't have to own all these alpha tokens. You could just hold Tao and that's like an index of all those things. That's how a lot of people subnet projects. There's Bitmind, which is a detection of deep fakes and
[11:03] synthetic media. Uh obviously, we need that more and more as AI content is that's one of the AI businesses. Uh I already mentioned the GPU one, one that seemed to be building a model. Um there's Score, which is computer vision
[11:16] this is for like robotics, manufacturers, retailers, etc. There's Synth, which is forecast scored against what actually happens. So, traders and anyone who has the price risk. So, it's about forecasting the future using AI in
[11:29] this one. And the way that money moves around these subnets is if you have a AI are really excited about it, there's more people that want to hold that alpha for the alpha token. That gives the subnet a higher valuation. That means
[11:44] So, they're getting more and more Tao because the market's saying, "Hey, this attention to this." And this attracts even more miners and builders to come over again. Tao is also used for staking and validator participation and a bunch
[11:58] of the biggest things that a lot of people note about Tao is that there's only 21 million tokens. And if that sounds really familiar, that's probably million times because Bitcoin also only has 21 million tokens. And in the same
[12:13] way that Bitcoin has halvings, Tao also has halvings where the emissions are cut when the total supply of Tao hits a certain point, they have a halving, which means the amount of money being paid to all these subnets
[12:28] gets cut in half. You have less new Tao being minted in the exact same way that Bitcoin works. So, Bitcoin had the first halving in November 28th of 2012. Before every time that you mine a block, you got 50 Bitcoin.
[12:41] After it went down to 25 Bitcoin. Their second halving was in July of 2016. It went from 25 to 12. In May of 2020, it went from 12 to 6. And in April of 2024, it went from 6 to 3. Now, after Bitcoin's first halving, which this is
[12:56] the 4-year cycle was kind of birthed. Like, this is what caused the 4-year cycle was the supply and demand change from the halving. It went 90X after its but Bitcoin is a lot smaller than Tao is today. But, it ended up going up 90X
[13:12] over basically the next year. Bitcoin's second halving, which is a little bit closer to to Tao because this was when Bitcoin was at $10 million market cap. Tao is sitting at $2 million market cap. So, they're a a bit closer.
[13:26] um, Bitcoin ended up doing a 30x. It went from $651 to basically 20,000. It was like 19,800 or something like that, 526 days later. And I actually think arguments as to why Tao could potentially head a lot higher over the
[13:41] next year is again, they just had their first halving in December of 2025. And saying, "Hey, uh, look at what Bitcoin did after its first halving and, you know, every halving since, why shouldn't Tao do the
[13:54] know, X amount and they cut that in half, so onto the market, then shouldn't that mean that price goes up because now all coming to the market anymore? Because the imbalance in supply and demand,
[14:08] shouldn't that automatically push Tao's price higher in the same way that it's did do a 30x gain, that would put Tao at around $5,730." And the interesting part is that if you actually compare the first 150 days post
[14:22] halving, uh, Bitcoin and Tao are really similar in terms of like their performance. Uh, Bitcoin was up 17% in the first 150 days. Tao was up around 14% in its first 150 days post halving. Now, obviously Tao is a little bit
[14:36] halving, and this is Tao's first halving, so it's a much bigger impact. So, you know, speculating, you know, if it played out the same way how big it because you're sort of mixing the Bitcoin's first halving and Bitcoin's
[14:49] second halving, but as I mentioned, if it did a 30x like Bitcoin's second halving, that'd be $5,300 or $730 per Tao. And if it reached the same market cap that Bitcoin did during its second halving, the peak, that'd be a 160x from
[15:03] here. So, that would mean every $1,000 invested turns into $160,000. excited about Tao is they're like, "Okay, this is AI. AI is super hyped right now. Tao is the Bitcoin of AI. There's only 21 million just like
[15:16] Bitcoin. They just had a halving just like Bitcoin, so we're going to see some insane Bitcoin-like gains for Tao over the next uh, you know whatever I don't know year two years that's kind of the bull case as
[15:30] people who hold Tao would point towards and say hey look at it's literally got all these Bitcoin properties. Maybe it turns out the exact same way. Now obviously the bear case is that I don't know none of these subnets end up doing
[15:42] anything. Right now you have a couple that are profitable they're doing stuff. I don't know it it looks like the vast majority aren't doing more than five otherwise I would guess they'd be number one. So you know the other ones are
[15:55] lesser it's still early days for AI and BitTensor and you know maybe BitTensor was just hyped because the AI trade is and has been so hyped and it just pushed prices up and it attracted some talent but we have seen in the past
[16:09] with things like OpenSea and NFTs and you know a lot of these protocols SushiSwap from back in the day EOS like there's a lot of these things in in crypto that have gotten crazy high
[16:23] valuations. They've attracted a ton of capital and talent but then years later the bear case for Tao would be that it it's the same like right now it's kind of in it's hype season because we're in the middle of the biggest AI bull run of
[16:36] all time in terms of like the wider market but you know like long term you That would that would be more of the bear case behind Tao. And as I mentioned at the start of this video I don't currently own or hold any Tao myself but
[16:49] I was really interested especially after doing this deep dive in the wider Tao thesis because I don't know a lot of these projects are really cool like a lot of these different projects in the Tao ecosystem and I do understand the
[17:04] vision I do understand I guess the goal of what they're going after. I'm just I've been burned I've been burned so hard in the past by projects that belief has been that this next crypto cycle is going to be heavily focused on
[17:18] decentralized AI. Um especially as you're seeing more and more the the model layer of the stack is getting compressed, meaning like models, people used to think that those were going to be the really shiny um money makers in
[17:31] open-source decentralized Not to sorry, not decentralized. Open-source models basically keeping up with the frontier labs. So, now people are wondering, is there going to be any value in having a model? Like, you know, OpenAI,
[17:45] valuations on we have these, you know, frontier models. But, you know, when Kimmy K3 comes along and releases the same thing but it's open-source and anyone could run it on their computer, which actually somebody just released uh
[17:58] some sort of I don't know what they did, uh but they made it so that uh Kimmy K3, which typically does require some pretty intense GPUs, um can run on a Mac Mini now, uh which is crazy. I I don't know how they did that. I I just saw it on X,
[18:11] know, there's a lot of these open-source models that people can run on their seems like, you know, to me that it's not it's like a hop, jump, and a skip to decentralized AI really taking off um in the same way that Ethereum, Bitcoin, and
[18:25] all these other decentralized protocols did the same thing for money. You could intelligence, which seems, you know, even more important uh that we have that decentralized. And so, I think crypto is going to be heavily focused on
[18:37] into one of the most insane AI bubbles of our lifetimes. So, that I I'm like heavily considering uh buying Tao uh just based off of this cuz it it is the king of, you know, crypto AI right now. And I I think it has enough to retain
[18:51] that um the the kingliness, right? The first The first runner typically has an advantage um even if it sucks, uh which I don't think Tao does, but you know, in first-mover advantage is just like so insanely powerful um in a lot of these
[19:05] categories. So, I could really see Tao doing well. And I don't think it's that we're going to see an AI crypto project at least eclipse a hundred billion during this wider AI bull market. And I still stand by that, but I wouldn't be
[19:18] surprised if it went to 200 300 billion like especially if it really ran. Um we saw a Tao ETF or something like that. Like you could you could imagine like want to buy it. Everyone wants to throw everything they have at AI anything. And
[19:32] stuff I mean I'm kind of talking to myself into it want to >> this video right now. So I'll probably sit on it. But yeah, I'm personally I'm interesting than I originally thought.
[19:44] entire portfolio or you want to see every time I buy and sell various tokens as well as different weekly video market updates. The Obsidian Council is know a lot of you guys have been asking when I'm going to open it back up. I
[19:56] opened it back up midway through uh last year, but I haven't opened it back up it back up anytime soon. But if you want back up, you can join the waitlist by clicking the link in the description of
[20:09] when I decide to open it back up again. As always none of this is investment do anything with your money. You should always do your own research and investment advisor. If this video is helpful, make sure to hit that like
[20:21] subscribe button and little bell next to it to be notified each time I release a new video. Thanks for watching and I'll see you next week.