Helped those who increased TAO by 90%, and today personally caused the price to collapse again.

Author: Deep Tide TechFlow

TAO suddenly dropped 15% today, now around $277, and still trending downward.

The sudden price drop might be caused by an open letter.

The author of the letter is Sam Dare, founder of Covenant AI. Bittensor is currently the highest market cap project in the AI+Crypto track, and Covenant AI is its most important subnet team within the ecosystem.

Last month, this team achieved a major milestone: using hardware contributed by over 70 contributors, they trained a 72B parameter large model called Covenant-72B, claiming to be the largest decentralized AI training in history.

A month ago, this event made TAO the brightest narrative in the entire crypto space, with a sense of AI brilliance.

NVIDIA CEO Jensen Huang publicly praised it, and well-known Silicon Valley investor Chamath mentioned it on a podcast, noting that $TAO it even surged 90% in a month, standing out in the current bear market environment.

But today, Sam Dare announced that he and his team are leaving Bittensor, and in doing so, also dismantled the foundation of this narrative.

Sam Dare’s open letter is lengthy, but the core accusation boils down to one thing:

Jacob Steeves, the founder of Bittensor (known in the community as Const), controls the entire network alone; decentralization is just a facade.

He listed a series of operations in the letter, with the two most severe being: first, directly suspending the Covenant subnet’s emissions, effectively zeroing out the team’s income; second, during conflicts, selling large amounts of tokens to exert pressure, using market tactics to force compliance.

The举报网站 Tao Papers, launched simultaneously today, provided more concrete evidence. According to on-chain data disclosed by the site, between 2023 and 2026, Bittensor underwent 41 network upgrades, of which 38 were from proposal to signing to deployment—all controlled by Const’s infrastructure. The other two signers co-signed within minutes each time, with no public discussion records.

The so-called “governance committee” of three people is actually a decision made by one person, with two others just rubber-stamping.

The open letter and the举报网站 went live on the same day, clearly indicating that Sam’s departure was not a spur-of-the-moment decision.

Correspondingly, two months ago, Bittensor’s founder Const announced he was resigning as CEO of Opentensor Foundation (the development fund behind Bittensor), claiming it was to promote decentralization.

Meanwhile, after announcing his departure, on-chain data also showed that Sam sold all 37,000 TAO tokens, fueling more FUD in the market.

As of now, Const’s only response to all this has been a single statement, roughly saying that Covenant’s departure is actually a good thing, as it could lead to the emergence of subnetworks that operate independently without relying on any team.

As for the accusations listed by Sam Dare, he hasn’t responded to a single one. But whether it’s tearing each other apart or contributing, the market has already priced it in.

In March, $TAO rose from about $170 to $337, nearly doubling. According to The Block, TAO surged over 50% within two weeks after Covenant-72B was released, making it the biggest single catalyst in the 90% rally.

CovenantAI is linked to templar, basilica, and grail (subnets sn3, sn39, and sn81). The subnet tokens are linked to TAO via staking mechanisms. When Covenant-72B was announced, the subnet tokens surged up to 400%, pulling TAO along with them.

So, people buying TAO are ostensibly investing in a decentralized AI network with hundreds of subnets, but the price structure tells a different story—almost half of the rally is driven by a single team.

Covenant’s rise and fall are both tied to Covenant. This phrase has been mentioned by many today, but most only see its surface meaning.

What’s more worth pondering is: why does a network claiming to have 125 subnets rely on just a few subnets to pump the price when rising, and also rely on a few subnets’ drama to dump when falling? Most of the other subnets have been nearly invisible in these two rounds of market movement.

Bittensor’s decentralized narrative has been sold for three years, yet its price structure always appears centralized. As for who is right or wrong in this conflict, I believe that’s not the main point.

Every ecosystem has star teams, and every star team can leave.

The real question is: what do you do when this happens?

In the bear market, crypto project team conflicts are nothing new. When the market lacks hot topics, whether a project rises or not depends entirely on whether there’s a narrative to hype. Covenant-72B is one of the best narratives this year—Jensen Huang praised it, TAO doubled, and everyone in the community felt that decentralized AI finally produced a competitive product.

But narratives have a natural flaw: those who create narratives can also destroy them. When prices rise, it’s the light of crypto; when they fall, it’s the team fleeing. For TAO holders, the 90% profit and the 15% loss today come from the same source.

This might be the most genuine investment dilemma in crypto right now. Prices always follow some narrative that appears out of nowhere, and that narrative is often tied to certain key individuals.

People are here, stories are here; when they leave, you might not even find a counterparty.