TrustedStake Research — take-aways, insights & what comes next for Bittensor

Four months ago Bittensor had around sixty-four live subnets, TAO paid a “steady ~18 %” root yield, and TrustedStake was still in closed beta.

Today:

• Dynamic TAO is live and already rerouting on-chain capital.
• Bittensor just crossed the 100-subnet milestone—up 55 % since December—spanning use-cases from GPU compute to real-time sports analytics.
• Barry Silbert re-emerged on Real Vision, called Bittensor “the next Bitcoin,” and launched Yuma Group to focus on TAO.
• TAO just absorbed a sharp macro shake-out plus a hedge-fund carry trade—setting the stage for a classic short-squeeze.
• And yes—TrustedStake v1 is live with non-custodial staking, instant delegation and an expanding tool-set for active allocators.

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Below is a condensed research note on what we believe matters as Q2 begins. NFA.

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1 | Why TAO trades like a slinky (and why that might end soon)

Macro shock. April’s surprise “weekend-tariff” tweet yanked global risk assets lower (S&P futures –5 %, BTC –12 %), then everything snapped back inside seventy-two hours. TAO followed the tape—normal for a high-beta token.

Synthetic drag. The bigger weight has been a delta-neutral carry loop:

Stake TAO on root (~18 % APR) → short TAO perps → pocket the spread.

dTAO’s “Tao weight” is meant to push capital from root into alpha participation. The mechanism assumed the sum of all alpha prices would hover near 1, trimming root yield roughly every sixty days (chart here). Today the sum sits around 1.91, so root rewards stay richer and the APY decline is slower. **Even so, the design forces root APY eventually toward single digits over time. At a ~10 % root yield the carry trade no longer covers funding + borrow. Funds will have to:

• Cover shorts (mechanical buy-pressure), or
• Rotate into subnet staking (impossible to hedge 1-for-1).

On-chain tells: ~70 % of supply is still staked; whale wallets (>10 k τ) hardly move; spot volume shrinks while perp OI stays high—proof most “selling” is synthetic.

Take-away: When the carry math breaks, TAO’s float becomes a coiled spring.