The cryptocurrency market saw a broad recovery, but Bittensor’s TAO token plunged 20% to around $263. The drop followed the departure of AI research group Covenant AI from the Bittensor network, citing concerns over centralized governance. Analysts noted suspiciously high sell volume just before the news broke, suggesting some investors may have had prior knowledge.
The broader cryptocurrency market staged a revival, with assets like Zcash and Dash gaining 20-30%. However, Bittensor’s TAO token tumbled 20%, becoming the worst performer among top 100 cryptocurrencies.
TAO’s price briefly sank to $253, its lowest point since mid-March. Its market capitalization fell to approximately $2.5 billion, making it the 38th-largest digital asset.
The decline was likely triggered by Covenant AI‘s departure from the Bittensor network. The group claimed co-founder Jacob Steeves held too much control, calling it proof of centralized governance.
Crypto commentator Ash Crypto claimed Covenant AI sold 37,000 TAO worth over $10 million. Another analyst, Ardi, argued sell volume hit its highest level since December 2023 a day before the news.
“If you think that’s a coincidence, you don’t understand the game you’re playing,” Ardi stated. He warned the market has uneven information and predatory positioning.
Despite the drop, some analysts see a potential rebound. Crypto Tony said the situation “gives opportunity vibes.”
TAO’s Relative Strength Index (RSI) currently stands at a mere 16. An RSI below 30 typically indicates an asset is oversold and could be poised for a short-term resurgence.
