What is Bittensor (TAO)? A guide to the decentralized artificial intelligence platform

Bittensor is a disruptive platform that bridges the distinct powers of artificial intelligence (AI) and blockchain. AI is quickly weaving its way deeper into more industries to help revolutionize myriad aspects of life — from driving to photography and programming. The technology can even help you to trade smarter. 

Bittensor is making moves in the space by providing a decentralized platform for anyone to create, train, and share machine learning (ML) models. 

What is Bittensor

Developing new AI models can be an expensive and resource-intensive process. It’s also accessible only to a handful of companies around the world. This has effectively created a closed system, where a small group of entities can seemingly control and determine the future of AI. 

AI is seen by many as one of the most important developments of the 21st century, creating a need for fair access among the many, not the few. Bittensor is helping provide wider access to the technology through blockchain and decentralization.

Towards this end, Bittensor has created a peer-to-peer ecosystem where users can create and deploy ML models. The different ML models can interact and learn from each other in a collaborative manner. With a strong emphasis on community, Bittensor is designed to support large-scale AI projects. Bittensor’s combination of AI and blockchain technology offers a unique way for AI to work with crypto in a transformative and responsible way. 

History of Bittensor

Launched by the Opentensor Foundation in 2021, Bittensor is a relatively new project compared to other popular blockchain entities like Tron and Arbitrum. Developers Jacob Robert Steeves and Ala Shabaana set up Opentensor Foundation, which is the driving force behind Bittensor. 

The project hopes to create a connected and coordinated global supply of computing power to develop AI technologies that are open-source and accessible. Bittensor is also guided by a delegate charter signed by Opentensor Foundation and other major participants. The charter outlines the principles and commitments the Bittensor network should follow when advancing AI applications. 

The charter’s fundamental goals include: 

• AI could pose a significant risk if it is centralized. The decentralization of AI is therefore essential. 

• Preventing the harmful usage of AI and ML. 

• Open-source AI development that’s accessible to everyone. 

• Open ownership of AI applications. 

• Transparency for the Bittensor blockchain and the project’s decision making. 

Tokenomics and distribution of Bittensor

Bittensor is powered by its native token TAO, which emulates Bitcoin in some ways. The total minable TAO is capped at 21 million tokens, while the asset experiences halving events. At the time of writing, approximately 6.5 million TAO tokens have been mined. 

TAO mining

TAO has an unique mining reward structure. A new block on Bittensor is created every 12 seconds, for which 1 TAO is generated. As a result, 300 TAO is mined every hour and 7,200 TAO is mined every day. Validators also form an important part of the Bittensor network. They can receive TAO by locking up their tokens and validating the network. 

TAO halving

TAO undergoes a periodic halving just like Bitcoin. However, unlike Bitcoin, which halves in a fixed number of blocks, TAO halves according to the supply. TAO halving occurs every time half of the entire remaining supply is mined. For example, TAO started with 21 million minable tokens, meaning a halving will happen when 11.5 million TAO is mined. Post-halving, miners will receive 0.5 TAO instead of the 1 TAO they currently receive. Now, with 11.5 million TAO yet to be mined, the next halving will occur after another 5.75 million TAO tokens have been mined, with the halving cycle repeating. 

TAO utility

TAO is used as a means of payment to access AI applications and other models built on the Bittensor network. The TAO token also acts as a governance token for participants to vote on proposals and future changes to the network. Additionally, staked tokens can also be used to participate. 

How does Bittensor work?

Under the hood, Bittensor has a complex network of algorithms and concepts to decentralize AI applications. Let's look at the core concepts powering Bittensor. 

Bittensor refers to its blockchain network as “subtensor.” It's connected to multiple platforms, called “subnets.” Bittensor’s network is currently made up of 32 distinct subnets. 

Subnets are an important part of how Bittensor operates. A subnet is a competition-based market that anyone can create or participate in. The competitive element encourages growth and high standards from users. Users can create a new subnet by paying TAO. Alternatively, you can participate in existing subnets either as a miner or a validator if you have enough computing resources. 

Each subnet serves a specific purpose. For example, the job of subnet one is to respond to text prompts and the job of subnet 11 is to transcribe spoken language to text using AI. 

Anyone can use the 32 AI systems, and both miners and validators work to solve them. For example, subnet 19 is for image recognition. Subnet validators receive images that have to be recognized and labeled. This task is distributed to all miners in the same subnet. Miners give the result to validators, who then rank the quality of the work done.  

Miners will receive TAO tokens as a reward for the quality of work done, and validators are also rewarded for participating. The subnets can also talk to each other to accomplish tasks that involve multiple steps. They use a Mixture of Experts (MoE) model, where subnets use their specialized knowledge to generate results for complex problems. 

Bittensor Consensus

Subnets work on complex AI tasks and report the key information to the central Subtensor blockchain. The core part of this blockchain is the Yuma consensus. It makes sure the network is decentralized with a hybrid proof mechanism, combining both Proof of Work (PoW) and Proof of Stake (PoS).

Both mining and staking happen on the subnets. Miners use their computing power to solve AI problems, and validators use staked TAO to validate the solutions. On top of this, validators post the transactions to the Subtensor blockchain.  Subtensor also has its own set of validator nodes that validate the transactions coming in and create new blocks every 12 seconds. 

Finally, a new TAO is minted with every block. This TAO is distributed across the 32 subnets based on the performance of the subnet. This is further distributed between the participants of the subnet: 

• 18% of TAO goes to the subnet owner. 

• 41% goes to subnet miners, and is called a ‘dividend’.

• 41% goes to subnet validators and is called an ‘incentive’.

Benefits of Bittensor

• Makes AI applications, which are otherwise restricted to large companies with deep pockets, accessible to everyone.

• Decentralizes AI-based development for greater individual control and transparency.

• Offers opportunities for everyone. Users with computing resources can participate as miners, while holders of the TAO token can participate as validators. 

• Offers a scalable AI network that’s ripe for wider adoption. 

• Fully open-source, letting developers make their own changes if they wish to. 

Risks of Bittensor

• The Bittensor network can be complex, which might be daunting for beginners. It has multiple layers, which could take time to understand. 

• While the network is built to be scalable, it hasn't been stress-tested. 

• With countries starting to regulate AI, Bittensor could face challenges in the future. 

• Technical expertise is required to participate in the network. 

Future of Bittensor

Bittensor has positioned itself as an inventive AI platform at a time when the technology is growing in interest and adoption. With AI evolving at a rapid pace, the world is hungry for more computing power. However, much of the current control over AI’s development is concentrated in the hands of a few companies. 

Bittensor has shown what’s possible with true open-source AI innovation, and is giving the masses the necessary tools to apply AI to their own projects. The community is actively developing new features, and the subnet system is expected to double in size. Should this growth continue, the system will be able to accommodate newer types of applications and bring fresh innovation to users. 

The final word

Bittensor has successfully managed to combine two of today’s most influential and disruptive technologies — blockchain and AI — in a way that delivers meaningful utility. The entity has created a community-based ecosystem that helps to make AI accessible to everyone through tokenization, decentralization, and the consensus mechanism. 

As more developers discover Bittensor, the network looks set to grow further, bringing new opportunities for AI development. With its decentralized marketplace, Bittensor could disrupt the existing centralized AI industry as a compelling alternative that successfully democratizes access to ML.