Bittensor (TAO) Price: Token Drops 30% After Subnet Operator Alleges Co-Founder Controls Protocol

TLDR

• Covenant AI publicly exited Bittensor on April 8, accusing co-founder Jacob Steeves of centralized control
• TAO dropped ~25–30% from its weekly high, falling from $337 to around $249–$253
• Over $650 million in market cap was wiped out, with $9.1 million in long liquidations
• Trading volume surged to $1.72 billion on April 10, vs. a $500 million average earlier in the month
• Technical analysis points to a potential further 25–45% decline toward the $144–$230 range

TAO, the native token of the Bittensor protocol, dropped sharply this week after one of its top subnet operators went public with serious allegations against the project’s co-founder.

Covenant AI announced its full exit from the Bittensor ecosystem on April 8. Founder Sam Dare followed up two days later with a detailed statement laying out the reasons for the departure.

Dare alleged that co-founder Jacob Steeves has maintained centralized control over the protocol. This directly contradicts Bittensor’s core pitch as an open, decentralized AI network where subnets can compete on equal footing.

The allegations include claims that Steeves unilaterally suspended a subnet’s emissions, overrode subnet owners’ authority within their own community spaces, and deprecated projects without following established processes.

Most critically, Dare alleged that Steeves used large, visible token sales as “punitive” tools to push compliance during operational conflicts. “These were not governance decisions made through transparent consensus,” Dare said. “They were actions taken by one man who never relinquished control.”

Dare also alleged that others in the project’s triumvirate serve mainly as “legal shields” while Steeves remains insulated from consequences.

Market Reaction

TAO fell roughly 25% in six hours on the news, dropping from $337 to $253. The crash erased over $650 million in market cap, bringing it to $2.57 billion.

Trading volume spiked to $1.72 billion on April 10, well above the $500 million average seen earlier in the month. The selloff was accompanied by a roughly 250% rise in volume, showing broad market participation in the move down.

In the futures market, $9.1 million in long positions were liquidated, with $9.71 million of total liquidations hitting bullish traders. Many traders holding long positions were caught offside, adding more forced selling pressure.

TAO has since recovered slightly but remains down 12.8% over the past seven days. It is still up 37% over the last 30 days.

Technical Picture

TAO is currently consolidating inside the 0.382–0.5 Fibonacci retracement range. In November 2025, a breakdown from this same zone led to a drop of over 30%. A similar pattern in June 2025 saw TAO stabilize near the 0.618 Fib level before bouncing.

Price Targets

If the June 2025 pattern repeats, TAO could decline to the 0.618 Fib support near $230. If the November 2025 fractal plays out, the 1.0 Fib target sits near $144, roughly 45% below current levels.

Trading volume on April 10 hit $1.72 billion, its highest point so far this month.

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