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I am not going to sugarcoat this. Last night hurt $TAO & Subnet holders
The founder of Covenant AI decided to cash out of SN3, SN39, and SN81, dumped roughly 37,000 $TAO worth of subnet Alpha on the way out, and cratered prices across the board. $TAO dropped as much as 27%. Nearly $900 million in market cap wiped. $9 million in longs liquidated. Alpha holders on those subnets got absolutely crushed.
I was one of them. I lost a significant amount from this. That is the reality and I am not going to pretend otherwise.
But I am still here. And I am still buying. Let me tell you why.
First, let me be clear about what actually happened. A subnet owner got into a disagreement with Const, got upset, and used it as an excuse to dump his bags on the people who trusted him. That is it. That is the whole story. He dressed it up as a principled stand against centralized governance but the man sold 37,000 $TAO worth of Alpha on his own community while posting a manifesto. That is a rug plain and simple.
Const responded within the hour. Publicly. On chain. With a solution.
Some people are acting like Bittensor died last night. It did not. Let me show you what actually happened in the hours after the dump.
Const proposed lock-based subnet ownership where ownership of a subnet is determined by a team's long-term economic commitment to the project. Not by who registered first. Not by who controls the keys. By who has skin in the game over time. Investors would see in advance if an owner unlocked their tokens. The market could reprice the subnet before the owner dumps. And conviction could be directed to another team or even an agent to manage the system.
If implemented, this would be the most significant governance upgrade since dTAO launched. And it came within hours. Not weeks. Not after a committee meeting. Within hours.
That is what this network does. It finds its weak spots and it fixes them. Fast.
@MacrocosmosAI posted: "Bittensor always emerges stronger from pain. Hacks, exploits, disagreements all fade into the history of this protocol. The flame of distributed training continues to burn brightly. One individual does not make a nation."
@jon_durbin from Chutes: "Chutes is and always will be a Bittensor project. Chutes is Bittensor and Bittensor is Chutes."
@MaxScore from Score: "Score is and always will be a Bittensor project. Score is Bittensor and Bittensor is Score."
Loayei: "Don't care about the drama. Will continue building $TAO."
@TroyQuasar from Quasar called it what it was. He said it was bullshit, that no one is bigger than the network, and that Quasar will take it from here.
The builders did not leave. The builders doubled down within hours. Publicly. On record.
@markjeffrey put it simply: "Bittensor is quite a LOT more than Subnet 3, and $TAO will carry on fine without it. There are 125 other subnets plus three new slots that just freed up."
Three new subnet slots just opened. While people were panic selling, builders were already eyeing the open seats.
@SiamKidd gave the most grounded take. He acknowledged the drama, acknowledged that Sam's governance concerns were not entirely wrong, but made the point that Const's motives have always been genuine. This is growth. This is what permissionless systems look like when they encounter stress. They break in specific places, they get patched, and they come back harder.
This is not the first time something like this has happened on Bittensor. It is not even the second time. Nous Research left the ecosystem before. And what happened? The network adapted, subnets evolved, and the protocol kept building. Every previous inflection point led to upgrades that made the system stronger.
Covenant-72B was real. The training was real.
Fundamentals haven’t changed:
21M hard cap, halving complete, 68% staked, nine institutional products accumulating, Grayscale ETF pending.
$TAO just went on sale at a 27% discount.
Builders keep building.
I’m buying this dip.
$TAO
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