Key Highlights
- Bittensor’s TAO token plummeted over 18% following Covenant AI’s departure announcement
- Sam Dare, Covenant AI’s founder, leveled accusations of centralized governance against Bittensor co-founder Jacob Steeves
- Claims include suspended emissions, revoked moderation privileges, and deprecated subnet infrastructure
- TAO currently hovers between $263 and $292, trading beneath its 200-day moving average with $250 as critical support
- Derivatives market shows nearly 1% decline in open interest to $392.59 million, with significant liquidations across major exchanges
The Bittensor network experienced a significant blow on April 10, 2026, as its native TAO token shed more than 18% of its value within a single day. This dramatic downturn wiped out gains from a previous rally that had pushed prices up over 100%, with the catalyst being Covenant AI’s decision to withdraw from the ecosystem.
As one of the network’s most prominent participants, Covenant AI managed three distinct subnets: Templar (SN3), Basilica (SN39), and Grail (SN81). Their departure represents a substantial loss for the protocol’s operational infrastructure.
In a scathing public disclosure, Sam Dare, who founded Covenant AI, directly challenged the decentralization claims of Bittensor, specifically targeting co-founder Jacob Steeves for what Dare characterizes as autocratic network management.
“The network functions under a triumvirate framework—three people controlling the multisig for protocol upgrades. This is marketed as distributed governance to the community. That’s misleading. This is decentralization in name only,” Dare stated in his announcement.
According to Dare’s allegations, Steeves halted token emissions to Covenant’s operational subnets, removed their administrative access to community communication platforms, forcibly deprecated their subnet systems, and executed calculated token liquidations designed to create financial strain.
Steeves “wields ultimate authority over the triumvirate, opposes any substantive power-sharing arrangements, and implements protocol modifications at will, bypassing established procedures and collaborative decision-making,” Dare asserted.
Complete Liquidation of TAO Position
Following the announcement, Dare liquidated his entire position in the network. Blockchain analysis from taosats revealed he sold more than 37,000 TAO tokens from his personal wallet, creating immediate downward price pressure on the asset.
While severing ties with the [[LINK_START_2]]Bittensor[[LINK_END_2]] ecosystem, Covenant AI confirmed it would maintain its research division, proprietary models, and ongoing development efforts. The organization indicated forthcoming announcements regarding new initiatives. “Decentralized, permissionless artificial intelligence training isn’t exclusive to Bittensor. It represents a technological frontier our team remains committed to exploring,” the company stated.
At press time, TAO was fluctuating in the $263 to $292 range. Throughout the 24-hour period, the token reached a low of $262.51 and peaked at $341. Transaction volume surged by 156% during this timeframe.
Critical Price Levels Under Watch
Well-known market analyst Cheds Trading observed that TAO has broken below its 200-day moving average and is approaching the 50-day moving average positioned at $250. The Relative Strength Index (RSI) declined to 41, suggesting additional downward momentum could be imminent.
The Covenant-72B model developed by Covenant AI had previously served as a major catalyst for TAO’s bullish performance. When NVIDIA CEO Jensen Huang mentioned the model during an appearance on the All-In Podcast, the endorsement contributed to TAO’s subsequent 90% price surge.
Derivatives market data from CoinGlass indicated that Bittensor futures open interest contracted by nearly 1% to $392.59 million in just one hour. The most substantial selling activity occurred on OKX, Gate, Bitget, Hyperliquid, and LBank exchanges. At the time of analysis, neither Binance nor Bybit had reflected comparable adjustments.
Following Covenant AI’s withdrawal, TAO is currently priced around $263 with derivatives open interest standing at $392.59 million.
The post Bittensor (TAO) Plunges 18% as Major Subnet Operator Covenant AI Abandons Network appeared first on Blockonomi.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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