Is there a hidden concern behind the surge of TAO? Bittensor demand is strong, but risks are rising simultaneously.

TAO-0,99%

Gate News reports that the decentralized AI project Bittensor (TAO) has rebounded significantly since its low point in February 2026, with the price rising from around $154 to approximately $330, marking a weekly increase of over 20%, and the market capitalization has recovered to about $3.17 billion. On-chain data indicates that the current rise is driven by real spot demand, although signs of market overheating are gradually emerging.

CryptoQuant data shows that the 90-day cumulative volume delta (CVD) has remained positive, with green bars replacing the previous red zone, indicating that buyers have been consistently absorbing selling pressure over the past few weeks, with spot funds dominating the market. This change is often seen as an important signal for trend continuation, suggesting that the capital is not short-term speculation but rather entering the market in a measured manner.

Meanwhile, the Bittensor ecosystem is expanding in tandem. The total market capitalization of subnet tokens has risen to about $1.4 billion, with most subnet assets achieving double-digit gains in the past 30 days. Another key indicator is the change in staking structure, with over 33% of TAO locked in subnets, reflecting an increased recognition of its AI computing power network and economic model by the market.

However, risk signals are also accumulating. CryptoQuant analyst Maartunn points out that spot trading volume, derivatives trading activity, and retail participation are all simultaneously heating up. This “multi-dimensional resonance” typically occurs in the later stages of a market cycle, indicating that market sentiment is gradually becoming crowded, which may amplify volatility.

Structurally, the current TAO increase is supported by both fundamentals and capital flows, but as trading activity rises across the board, the probability of a pullback will also increase. In the short term, the market may enter a high volatility range, and investors need to pay attention to fund flows and changes in sentiment to assess whether the trend can continue.

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