CryptoConAlex retweetet
Sam Dare just dumped 37,000 TAO on his own subnet holders.
Roughly $10 million. In two clips. After publicly accusing Bittensor of being centralized.
Then he walked.
This is the Covenant AI exit nobody is telling you the full story about.
The setup.
Sam Dare runs Covenant AI. They operated three subnets on Bittensor. Templar (SN3), Basilica (SN39), Grail (SN81).
Templar was the crown jewel. The team behind Covenant 72B. The model Jensen Huang shouted out on All-In. The reason TAO ran 90% in March.
Yesterday Sam posted a long thread accusing Bittensor founder Const of "decentralization theatre."
Hours later he sold his bags.
The allegations.
• Const suspended emissions to Covenant's subnets
• Const removed Sam's moderation rights over his own community
• Const deprecated Covenant's subnet infrastructure
• Const dumped TAO at strategic moments to apply economic pressure
• A three-person multisig that's actually controlled by one guy
Sounds damning. Until you read Const's response.
Const's actual response.
• "I do not have the ability to suspend emissions." He sold 1% of his alpha holdings on three Covenant subnets that were on near-100% burn code. Same buy/sell rights every TAO holder has.
• He didn't remove Sam as a Discord mod. He gave Sam a temporary timeout for deleting honest criticism from his own community channel. Mod role was reinstated.
• "Deprecating infrastructure." Const doesn't even know what that means.
• Less than 1% of what Const had personally invested in Sam's teams. Visibility is impossible to avoid in his position.
Const previously gave Sam a 2,000 TAO bonus and invested thousands of TAO into his subnets.
Const's "dump" was around 200 TAO.
Sam's dump was 37,000+ TAO.
The rug.
That's $10 million pulled from holders who believed in the Covenant 72B story.
Subnet holders are catastrophically down. The "noble dev exposing the evil founder" framing falls apart the second you check the wallet.
What Const is actually building next.
Const answered a DM from @TaoOutsider right after the exit. He sounded calm. Called it a "spring forward moment."
Here are some suggestions @0xSammy gave for TAO:
• Lock-based subnet ownership. Subnet ownership tied to a team's long-term economic commitment.
• Vesting schedules visible onchain so investors see unlocks in advance.
• Founders won't be able to sell emissions as they receive them.
• Exit cool-down periods so leaving teams can't dump 100% at once.
• Headless subnet architecture so no single team can pull the plug.
• Protocol-level IP retention so models trained on Bittensor compute stay with the network.
• Onchain revenue sharing flowing back to alpha holders.
These are the changes Bittensor needs right now. I hope this $10M rug will force these changes to happen sooner, rather than later.
The contrarian take.
Most people are watching this and concluding Bittensor is broken.
I'm watching this and concluding Bittensor is finally maturing.
Const built the team. Const funded it. Const did most of the research on Templar. Sam was the face. The compute, the emissions, the incentive design that made Covenant 72B possible. None of it leaves with him.
Someone else can take that model and build a bigger run on the same network.
The subnets to watch right now per Stillcore Capital's Mark Jeffrey:
• SN64 Chutes. Inference at 1/6th the cost of competitors.
• SN62 Ridges. AI coding assistance beating Claude and Cursor on SWE-bench at 1/770th the cost.
• SN4 Targon. $42M valuation.
• SN9 IOTA. Decentralized training infrastructure.
(Also SN50, 68, 65, 44, 18, 85, 17, 48, 93, 54)
The TAO bull thesis didn't need Sam Dare. It needed proof that builders can build on permissionless infrastructure.
Covenant 72B was that proof.
It still exists. The network that made it possible still exists.
Sam left. The thesis didn't.
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