Key Highlights
- On April 8, Covenant AI publicly withdrew from Bittensor, claiming co-founder Jacob Steeves maintains centralized authority
- The TAO token plummeted approximately 25–30% from weekly peaks, declining from $337 to roughly $249–$253
- Market capitalization shed over $650 million, while long position liquidations reached $9.1 million
- Daily trading volume exploded to $1.72 billion on April 10, compared to approximately $500 million earlier in the month
- Chart analysis suggests TAO may face an additional 25–45% downturn, potentially reaching the $144–$230 zone
The Bittensor protocol’s native cryptocurrency TAO experienced a significant downturn this week following public accusations from a prominent subnet operator targeting the project’s co-founder.
On April 8, Covenant AI declared its complete withdrawal from the Bittensor platform. Two days afterward, founder Sam Dare published an extensive statement explaining the rationale behind the decision.
Dare’s accusations centered on claims that co-founder Jacob Steeves maintains centralized authority over the protocol. These allegations stand in stark contrast to Bittensor’s fundamental positioning as a decentralized, open AI network designed to enable fair competition among subnets.
The claims encompass assertions that Steeves single-handedly halted a subnet’s emissions, bypassed subnet operators’ control within their designated community channels, and removed projects without adhering to established governance frameworks.
Perhaps most significantly, Dare contended that Steeves employed substantial, public token disposals as “punitive” mechanisms to enforce compliance during operational disputes. “These weren’t governance actions executed through open consensus,” Dare stated. “They were decisions made unilaterally by one individual who never surrendered control.”
Dare further claimed that other members of the project’s leadership function primarily as “legal shields” while Steeves remains protected from accountability.
Market Response
TAO experienced approximately 25% erosion within six hours following the announcement, tumbling from $337 to $253. The collapse eliminated more than $650 million in market valuation, reducing it to $2.57 billion.
Daily trading activity surged to $1.72 billion on April 10, significantly exceeding the $500 million average observed during the month’s earlier period. The decline was accompanied by roughly 250% volume expansion, demonstrating widespread market involvement in the downward movement.
Within the derivatives market, $9.1 million worth of long positions faced liquidation, with bullish traders absorbing $9.71 million in total liquidations. Numerous investors maintaining long exposures were caught unprepared, intensifying the forced selling dynamic.
TAO has demonstrated modest recovery since the crash but continues trading 12.8% lower across the seven-day period. Over the past 30 days, it maintains a 37% gain.
Technical Analysis
TAO is presently consolidating within the 0.382–0.5 Fibonacci retracement band. During November 2025, a breakdown from this identical zone triggered a decline exceeding 30%. A comparable formation in June 2025 witnessed TAO finding stability around the 0.618 Fib level before recovering.
Projected Levels
Should the June 2025 formation repeat, TAO may descend toward 0.618 Fib support around $230. If the November 2025 scenario unfolds, the 1.0 Fib objective sits approximately at $144, representing roughly 45% below present levels.
Trading volume on April 10 reached $1.72 billion, marking the highest level recorded this month.
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