TAO Bleeds 18.5% as Covenant Slams BitTensor's 'Decentralization' Theater (And Yes, We Mean the Opposite of Decentralized)

In the grand tradition of crypto drama—which typically involves someone yelling about decentralization while quietly building a kingdom—BitTensor founder Jacob Steeves and a high-profile network builder have decided to throw hands publicly, sending TAO into a glorious 18.5% nosedive in just 24 hours. Because nothing says "trustless infrastructure" quite like a Twitter beef with your validators watching.

Covenant AI, one of BitTensor's most recognizable subnet operators, announced its dramatic exit stage left this week, dropping the crypto equivalent of a resignation letter written in fire. The accusations? Malfeasance, centralized control, and what Dare delicately described as "decentralization theater"—which, in crypto terms, means looking Web3 while operating Web2.

"When a single actor can suspend a subnet's emissions, override an owner's authority over their own community spaces, publicly deprecate projects without process, and use token sales as a coercive mechanism to compel compliance, that is not decentralization," Covenant AI founder Sam Dare posted on X. "It is centralized control with decentralized branding." Ouch. That's the kind of callout that makes you check if your moderator permissions are still valid.

Dare alleged that Steeves pulled a classic power move by suspending Covenant's subnet emissions—the magical token sprinkles that distribute TAO to miners and validators—while simultaneously playing landlord with Covenant's community spaces, essentially cutting the company's ability to chat with its own people. Imagine getting banned from your own Discord by the project's founder. The irony is not lost on anyone.

Steeves, not one to take accusations lying down, fired back that Dare was actually the one deprecating channels and deleting posts faster than a developer removing incriminating Slack messages before an audit. "I do not have the ability to suspend emissions," Steeves insisted, which is the blockchain equivalent of "I wasn't touching the thermostat, someone else changed it."

Covenant had been riding high on attention for its permissionless training of the Covenant-72B model—an achievement so impressive that billionaire Chamath Palihapitiya hyped it on the "All-In Podcast" and reportedly dropped Jensen Huang's name in the same sentence. You know you've made it when your AI model gets more podcast shoutouts than most