The market has cooled off this week, with TAO retracing 5.5% to $415 after a 23.39% surge to $454. Wider ecosystem KPIs remained consistent with last week. Sum_of_alpha is still hovering around 1.7 and Reserves Over Injected has slightly slipped to ~12%. 

Even though BTC has been testing ATHs for the first time since January, the consolidation at $412 - $440, unlike historical blow-off tops at this level, has analysts curious about TAO’s next step.

And top subnets haven't necessarily absorbed any capital from risk hungry market participants either...

All alpha tokens in the top 10 except for TAOHash have continued to put in red candles, some down > 50% since their ATHs in mid-April when we saw sum_of_alpha at an ATH of 2.34.

Where we go from here?  Unsure. This is probably the first time in a month where I haven't had an opinion about where the market goes, so I have been sitting out on most ST plays, and instead, I have been slowly shuffling TAO into longer term (6mo) holds.

My silver lining for sideways price action is that it enables me to spend more time analyzing subnet fundamentals, the wider DeAI x CeAI space, and speaking with founders and long term capital allocators.

Sometimes the greatest action is inaction...

Nonetheless, the ecosystem still had some interesting developments, discussions, and published research hit this week..

TLDR;

• EVM Expansion & Multichain Moves: LayerZero adds Bittensor EVM support. Users will soon be able to buy alpha tokens from Ethereum, Base, and more. Wrapped alpha on Solana is also in the works.

• Governance & Incentive Debates: Root staking APY is under scrutiny as the community debates shifting incentives toward subnets to encourage broader participation.

• SN8 Fallout: Miners cut their bags causing the price to crash ~50% in one day, sparking debate about the subnet’s net value to the ecosystem.

• Ecosystem Spotlight: TAO Hash crossed 7 BTC earned, Mainframe was featured in Forbes and partnered with Rowan Science, Patrol enters its “Prediction” phase with new alpha-focused intelligence tasks.

• Ecosystem Culture: Bittensor’s first NFT collection, a new Messari report, the Ventura Labs, TAO Talk, and Hash Rate podcasts brought attention to subnet models and TAO Hash.

Highlights of the Week

⚡️LayerZero announced support for the Bittensor EVM, which unlocks cross-chain interoperability with 130+ networks. On the other hand, VoidAIplans to enable wrapped Alpha (wALPHA) trading on Solana.

Sam, founder of SN10(@SturdyFinance) &@_TaoFi_, a soon-to-be full-suite DeFi solution built on the Bittensor EVM, weighed in on the updates, rejecting wALPHA in favor of pulling external capital into Bittensor’s core economy, reinforcing canonical Alpha markets rather than fragmenting them across chains.

My Take: While I see where Sam is coming from (read here), I don't necessarily believe that issuing wALPHA across multiple chains technically fragments liquidity. The wALPHA peg should theoretically always be maintained by arbitrageurs porting liquidity into/out of the ecosystem, returning price equilibrium back to the base (canonical) asset.

Also, probably a hot take, but I don't think that wALPHA on Solana is a reliable catalyst we should lean on. Solana degens have their own assets and metas they are trading and they won't view alpha tokens through the same lens as fair-launched tokens they are accustomed to.

⚡️ For subnets 1-64, the Root:Alpha emissions proportion has flipped, meaning that Alpha stakers now receive a larger portion of the emissions than Root stakers. (For more info on Root prop, please visit this guide from @learnbittensor)

However, Root APY is still receiving criticism for being fairly high (~19%ish), with some event citing it as an opportunity for free riding TAO without having to take a risk and allocate to alpha tokens. For others, they believe that the system shouldn't be touched and that a higher root prop makes it difficult for subnets to grift, returns the cumulative value of subnets back to TAO holders, and directly benefits over-leveraged and underwater ALPHA apes...

My Take: Keep APYs and Root prop the way it was originally built. Let the system find an equilibrium since it has only been about 3 months since the inception of dTAO.

I do not believe that forcing the market's hand by adjusting yields this early into the experiment are positive actions that would encourage and entice new allocators who are still acquainting themselves with Bittensor. If this is a multi-decade project, we shouldn't be so rash by changing something so foundational.

⚡️SN8(@taoshiio) saw their alpha token price completely collapse on Wednesday after most miners simultaneously cut their bags. This news also hit about a week after the Taoshi team announced that they would be trimming miner emissions by 90%.

The token, down ~51% this week, has sparked debate across Discord and X, with some announcing they've scooped the dip (since deleted), and others claiming that Taoshi was due for a correction and that its core product is not viable.

Furthermore, it was widely discussed that the team's appearance on this past week's Novelty Search did not adequately address the community's concerns and questions around the subnet & Glitch Financial. Regardless, Arrash, Taoshi founder, said that he is in it for the long haul.

My Take: While I cannot comment on the product since I have never tried using signals generated by SN8 miners, nor have I tried any of its adjacent products such as Timeless, I can see why the community would begin to raise questions about the development state of Glitch Financial, given that it was "announced" approximately 6-7 months ago and has yet to be delivered.

⚡️ The Proof-of-Talk Paris speaker lineup has been announced, and Bittensor is truly bringing 'em out. Representing the eco will be almost every big name including Const, Ala, Barry, Mog, Carro, JJ, Mike Grantis, & several others...

Better yet, the conference will be held in the damn LOUVRE, taking place from June 10 - 11. I am sure that this will be incredibly exciting for all who are able to make it out to the city of love this summer! Get your tickets here.

Subnet successes & additional alpha … ⬇️