EP04: Why Bittensor's TAO Demand Will Be Higher Than Ever.

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Aug 8, 2025

The hosts dive into Bittensor's innovative edge over centralized systems, highlighting the human power in tackling complex issues. They discuss the increasing demand for TAO tokens due to subnet growth and an impending halving event that will reduce daily emissions. The conversation touches on the challenges of regulating open-source AI and the lessons from dual-use technologies. Listeners get insights into decentralized finance models like Targon, emphasizing their real-world benefits. Overall, it's a captivating exploration of the future of AI and its dynamic market landscape.

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INSIGHT

Humanity-Scale Incentives Beat Companies

BitTensor harnesses global human creativity to solve problems no single company can match.
James Altucher compares its potential to the internet's rapid global takeover.

INSIGHT

Staking Demand Could Exceed Circulating TAO

Removing the 128 subnet cap could require 10–15 million additional TAO for 1,000 subnets.
That far exceeds the ~9.5 million TAO currently in circulation, pressuring price and demand.

INSIGHT

December Halving Halves Daily TAO Emission

BitTensor's first halving in December cuts daily TAO emission from 7,200 to 3,600.
Lower emission increases scarcity and raises competition to absorb emission by top subnets.

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Hosted by James Altucher and Joseph Jacks.

In this episode, James and JJ discuss Bittensor's unbeatable scale against centralized companies, parallels to the internet/crypto revolutions, unregulatable open source AI, demand math for TAO with subnet growth (e.g., 10-15M additional staked TAO for 1,000 subnets), the upcoming halving event in December 2025, alpha token economics/volatility, regulation debates (e.g., Eric Schmidt on open source AI), dual-use tech risks, and rational optimism for AI's future. They also did a small Q&A at the end of the episode.

Key Timestamps & Topics:

00:00:00 - Intro: Bittensor's humanity-scale advantage; internet/crypto parallels; unregulatable open source creativity.
00:01:00 - TAO Demand Math: Staking/users/validators for 1,000+ subnets; 10-15M additional TAO needed (vs. 9.5M circulating).
00:02:00 - Halving Event: December 2025 cuts emission from 7,200 to 3,600 TAO/day; scarcity impact.
00:03:00 - Alpha Tokens: 21M supply cap; faster emission (1.5-2x TAO); volatility from thin liquidity (e.g., 2M circulating alpha).
00:06:00 - Pool Dynamics: Price sensitivity in early stages; stability in 6-9 months as supply reaches 10-20%.
00:08:00 - Market Factors: Organic exchange listings; daily volume $100-200M; staking for emission ranking.
01:04:00 - Regulating Open Source AI: Eric Schmidt's views critiqued; impossible to regulate human curiosity/creativity.
01:05:00 - Dual-Use Tech: AI vs. nuclear weapons; kitchen knife analogy; good intentions vs. bad outcomes (e.g., student loans).
01:09:00 - Rational Optimism: History shows good outpaces bad (e.g., internet, Bitcoin); societies at all-time highs despite fears.
01:12:00 - Wrap-Up: Relax if not understanding everything; ride the wave of Bittensor's evolution.

Key Takeaways:

Bittensor scales infinitely like the internet/crypto, outcompeting centralized solutions via permissionless, humanity-wide incentives—no company can match global creativity.
TAO demand surges with subnet growth (post-128 cap removal): Back-of-envelope math shows 10-15M additional staked TAO for 1,000 subnets, vs. current 9.5M circulation; halving adds scarcity.
Alpha tokens are volatile early due to thin liquidity (2M circulating vs. 21M cap), but stabilize as emission progresses—faster halving (every 2-3 years) accelerates price discovery.
Open source AI is unregulatable, as it equates to stifling human curiosity; dual-use fears (e.g., biological weapons) are flawed—history proves innovation's net good outweighs risks.
Optimism prevails: Regulations often backfire (e.g., tuition inflation from student loans); AI's progress mirrors societal advances, with good far outpacing bad in unregulated environments.

Resources & Links:

Bittensor Official: bittensor.com
Taostats (Explorer/TAO App): taostats.io
xAI: x.ai
Follow Hosts: @jaltucher & @josephjacks_ on X