Bittensor Crashes 25% After Covenant AI Exits, Warns of $236-$175 Drop

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Bittensor price outlook as top subnet operator Convent AI exits

The price of Bittensor dropped more than 25% in just a few hours after Covenant AI, a major and highly engaged part of the Bittensor network, left due to worries about the network becoming too centralized.

Summary

  • Bittensor (TAO) plunged 25.6% from $340 to $253 after Covenant AI exited the network, triggering nearly $9 million in long liquidations.
  • Covenant AI founder Sam Dare accused Jacob Steeves of centralization, alleging emission cuts and unilateral control over subnet operations.
  • Technical breakdown below key support levels signals further downside risk, with price eyeing $236 and potentially $175 if selling pressure continues.

Bittensor (TAO) experienced a significant price drop on Friday, falling 25.6% from $340 to a low of $253, according to crypto.news. This decline wiped out nearly $900 million in market value. Currently trading at $266.7, the token’s price hasn’t been this low since mid-March.

A sudden price decrease caused approximately $9 million worth of losing trades for those who expected the price to keep rising, surprising many investors who had been optimistic for weeks.

The price of Bittensor dropped significantly after Covenant AI, a major network operator responsible for several key subnets like SN3, SN81, and SN39, announced it was leaving the Bittensor network.

On April 10th, Sam Dare, the founder of Covenant AI, publicly accused Jacob Steeves, founder of Bittensor, of going against the network’s original goal of being decentralized, according to a post on X.

The post, which received over a million views and almost 800 likes, alleged that Steeves cut off emissions to Covenant’s networks, removed their ability to moderate their own channels, and stopped supporting vital network infrastructure without their consent. The team also stated that leadership dismantled infrastructure and used financial pressure during the conflict.

According to Dare, Jacob Steeves is firmly in charge, doesn’t share power with others, and makes decisions on his own, without following established procedures or seeking agreement.

This team isn’t just exploring the idea of decentralized, open AI training – they’ve already proven it works. Covenant AI successfully tested large language models on a decentralized network, most notably completing a complex 72 billion parameter model run with contributions from over 70 different people.

After leaving the project, people noticed Dare had sold all of his ownership in the network, which is widely considered a ‘rug pull’ that severely damaged Bittensor and caused the value of its token to plummet. He sold over 37,000 TAO tokens, resulting in roughly $900 million being wiped off the total market value.

Bittensor price analysis

Looking at the daily price chart, Bittensor has fallen below a rising channel it’s been following since late February. This often suggests the price trend is changing and could lead to further price drops as investors sell their holdings.

After that, the token’s price dropped below $294.2, which is a key support level based on Fibonacci retracement. This level had previously prevented the price from falling further in recent weeks.

The price is now expected to fall to $236, a level that corresponds with a key Fibonacci retracement. If the price drops below $236, it could fall further to around $175 – the low point reached in early March.

Based on my analysis, the technical indicators suggest a potential short-term downturn. Specifically, the Supertrend indicator recently changed to red – something we haven’t seen since March 10th – which signals a shift in the market’s direction.

The Relative Strength Index (RSI) has dropped to 41, indicating the asset is nearing oversold conditions, but selling is still strong.

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2026-04-10 15:31