TAO Plummets 9% as Top Operator Dubs Bittensor “Decentralization Theatre” and Exits Stage Left

Bittensor’s TAO took a 9% dive in 24 hours, nosediving to $292 while the rest of the crypto market casually strolled upward by 1.4%. In a world where everything’s pumping except your portfolio, TAO somehow became the crypto equivalent of the last kid picked for dodgeball—except this time, it’s the worst-performing coin in the top 100, and the dodgeball is a sledgehammer labeled “governance drama.”

The drama queen of the moment? Covenant AI, one of Bittensor’s most high-profile subnet operators, which just announced it’s torching its subnets and walking out like a degen at a family BBQ when the salad course arrives. The subnets in question—Templar (SN3), Basilica (SN39), and Grail (SN81)—were once crown jewels in the Bittensor diadem, now reportedly collecting digital dust in the corner of the server room.

Founder Sam Dare didn’t just send a breakup text; he dropped a manifesto. In it, he accused Bittensor co-founder Jacob Steeves of running what’s supposed to be a decentralized network with the subtlety of a crypto CEO selling NFTs of his face. Allegations include suspended emissions to Covenant’s subnets (a real “thanks for all the work, now scram” move), revoked moderation access to community channels (because nothing says “open ecosystem” like kicking admins during a riot), unilateral deprecation of infrastructure, and strategic token dumps that reeked of economic coercion.

“We cannot in good conscience continue to build on a network where the foundational claim we make to our investors—that this infrastructure is decentralized and permissionless—is contradicted by the reality of how the network is actually governed,” Dare wrote, with the tone of a man who just realized his DAO is run by a two-person Telegram group and a spreadsheet.

And then came the mic drop: “Bittensor operates a triumvirate structure, three individuals who manage the multisig for network upgrades, presented to the community as distributed governance. It is not. It is decentralization theatre.” Translation: the emperor’s new governance is, in fact, wearing a very centralized speedo.

For the uninitiated, Covenant AI’s Covenant-72B model was once the golden child of TAO’s ecosystem—so hot that even NVIDIA’s Jensen Huang name-dropped it on the All-In Podcast, sending TAO on a euphoric moonshot. Now, that same model’s creators are exiting the stage, leaving behind only echoes and a very awkward silence in the Discord.

Still, Covenant AI isn’t folding its tent entirely. The team plans to keep its research squad, existing models, and probably a few emotional support GPUs. Fresh project teasers are on deck, suggesting they’ve already moved on—like a dev who just rage-quit a failing fork to start a new meme coin with better vibes.

“Covenant AI’s mission has not changed,” the team declared. “Decentralized, permissionless AI training is not a Bittensor feature. It is a technological capability that our team is eager to advance.” In other words: the idea was never the chain—it was the chaos, the compute, and the courage to call out the emperor’s questionable fashion choices.

Whether this exit sparks a full-blown governance reckoning in the Bittensor community—or just another “lol decentralization” meme in the Telegram—is still up in the air. But one thing’s clear: when the decentralization narrative cracks, even the most loyal subnets start packing their bags.