Bittensor's TAO Token Plummets Amid Market Turmoil

Bittensor’s native token, TAO, has experienced a significant decline of 16% within a 24-hour period, dropping to a low of $389. This downturn is part of a broader trend in the artificial intelligence sector, which has seen an overall decline of 9%. The recent losses for Bittensor coincide with Bitcoin’s slip to near $100,000 and a total market capitalization decrease to under $3.4 trillion. Analysts remain optimistic about Bitcoin and the overall market, but investors are facing a mix of macroeconomic pressures and sector-specific challenges that are contributing to a risk-off sentiment in the market.
Bittensor operates as a decentralized machine learning protocol that incentivizes collaborative AI model training through blockchain technology. The recent price drop for TAO follows a period of profit-taking after a notable rally, which was initially sparked by the launch of Europe’s first staked TAO exchange-traded product (ETP) by Safello. Despite a surge in trading volume by 17% to $712 million, reflecting increased panic selling, bulls have struggled to maintain upward momentum, with TAO’s price hovering around $400 after peaking at $488.
The broader cryptocurrency market has also faced substantial losses, with over $250 billion in market value evaporating in just 24 hours. This has resulted in a 5.8% contraction in overall market capitalization, now totaling $3.4 trillion. Major cryptocurrencies, including Ethereum, Solana, and XRP, have posted significant losses, and liquidations in derivatives markets have surpassed $1.13 billion. Contributing factors to this downturn include cautious remarks from Federal Reserve officials regarding interest rates and the recent $128 million Balancer exploit, which has heightened concerns about the security of smart contracts in the crypto space.
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