Bittensor (TAO) has experienced a commendable uptick of over 5.1% in the past week, marking a notable positive turn for the AI-centric cryptocurrency. Currently trading at approximately $188.90, the token briefly surpassed the $200 mark earlier in the week, suggesting strong investor optimism.
This surge comes on the heels of a broader recovery in the AI crypto sector, which had previously suffered a dip of 30.28% in market capitalization, falling to $14.66 billion. Since February 12, however, the sector has rebounded impressively, with TAO leading this recovery with a striking 30.93% rally from its lows.
Barry Silbert, a notable figure in the crypto space, voiced his positivity about TAO, asserting that it stands out among many AI-centric tokens, which he claims lack substance. He even suggested that TAO could yield returns far exceeding traditional assets like Bitcoin, indicating a strong endorsement as sentiments towards AI tokens shift.
The growing interest in Bittensor is further evidenced by the performance of other AI tokens, such as Render and NEAR Protocol, which saw gains of 18% and 15%, respectively. This trend signifies a revived appetite for the AI narrative within the cryptocurrency market.
Bittensor functions as a decentralized machine learning network, allowing developers to collaborate and optimize AI models. The TAO token serves as a gateway for users seeking access to AI functionalities, placing Bittensor at the confluence of blockchain technology and artificial intelligence.
Supply Dynamics Fuel Price Growth
A significant factor contributing to TAO’s recent price strength is the adjustment in its token supply. Late last year, Bittensor underwent a halving event that reduced daily emissions from 7,200 tokens to 3,600. This restructuring has resulted in nearly three-quarters of the entire TAO supply being staked, thereby tightening the available circulating supply.
The strategic reduction in emissions, coupled with high staking participation, has created what some analysts describe as a “supply shock,” where diminished availability in the market leads to pronounced price increases amid rising demand.
Moreover, network activity surged this week, with a 34% increase in subnet usage on the Bittensor platform, indicating an uptrend in real-world applications and developer engagement.
Technical Analysis Reveals Mixed Outlook
From a technical perspective, analysts highlight potential upside targets of $241 and $268 for TAO, based on Fibonacci retracement levels. Recently, the token managed to break through a critical resistance level of $200, which could pave the way for further gains if momentum develops.
However, caution is advised as the longer-term outlook appears bearish, requiring TAO to exceed the $302.40 mark—the January high—to alter the prevailing trend. Current chart patterns indicate potential retracement to the $165-$175 range before any substantial upward movement can take place.
Despite the recent bounce, TAO remains over 50% down year-to-date. The token’s 52-week range has fluctuated between $144.32 and $535.12, with current valuations sitting far below the yearly peak. Trading volume has reached an impressive 230 million, with a market capitalization standing at $1.9 billion, solidifying Bittensor’s position as a significant player in the AI-focused crypto space.
