- Bittensor’s token plunged 16% in 24 hours to hit lows of $389.
- Losses for the top artificial intelligence coin came amid profit-taking following a recent spike.
- Fed’s hawkish stance, the Balancer exploit, and AI-capital rotation have fueled risk-off sentiment.
Bittensor’s native token, TAO, fell sharply over the past 24 hours, dropping about 16% to lows near $389 — a steeper decline than the broader artificial intelligence crypto sector, which lost roughly 9% in the same period.
The sell-off came as Bitcoin eased toward the $100,000 level and the total crypto market capitalization slipped below $3.4 trillion. Despite continued bullish outlooks from some analysts for Bitcoin and the broader market, investors face an array of macroeconomic pressures that have dampened risk appetite.
At the same time, sector-specific headwinds and short-term profit-taking have amplified downside moves, pushing some holders to liquidate positions and increasing market volatility.
Bittensor’s TAO plunges amid profit-taking
Bittensor is a decentralized machine learning protocol that rewards contributors who train and share AI models via its blockchain. Its native token, TAO, had recently outperformed many peers, benefiting from renewed investor interest in AI-related projects and stocks.
After a notable run-up tied in part to increased attention and product launches, TAO’s price reversed sharply, registering a roughly 16% intraday decline and moving down toward $389. Attempts by bulls to stabilize the price have so far left TAO trading around $400, meaning it remains well off recent highs near $488.
Trading volume surged during the sell-off, rising around 17% to roughly $712 million, a sign of heightened selling pressure and panic-driven activity. Both retail and institutional participants appear to have reduced exposure amid concerns that the AI-driven rally may be losing momentum.
The correction was likely intensified by profit-taking after the recent introduction of Europe’s first staked TAO exchange-traded product (ETP). That launch initially fueled a rally in TAO, but momentum stalled and early gains gave way as investors booked profits.
Broader crypto market sell-off
The downturn in TAO occurred within a wider market pullback that erased more than $250 billion in value in 24 hours, cutting overall crypto market capitalization by roughly 5.8% to about $3.4 trillion. Bitcoin’s decline of around 6% toward the $100,000 area and losses across major altcoins highlighted a shift to risk-off positioning.
Market sentiment moved into the “fear” zone as traders reacted to several drivers: hawkish comments from Federal Reserve officials that reduced expectations for a December rate cut, the recent Balancer protocol exploit that shook confidence in decentralized finance security, and rotation of capital away from headline AI assets after sharp rallies.
Ethereum also faced pressure, falling about 8% to roughly $3,340 and breaching a key support level near $3,550, while weekly losses widened to around 18%. Solana, XRP and other major tokens posted significant declines, and derivatives markets saw liquidations surpassing $1.13 billion as leveraged positions were forcibly closed.
Institutional flows reflected the caution: U.S. spot Bitcoin and Ethereum ETFs recorded several consecutive days of outflows amid the heightened uncertainty. Security concerns raised by high-profile DeFi breaches further weighed on sentiment — the Balancer exploit in particular underscored the fragile state of some smart-contract-based systems and reinforced the perception of elevated operational risk in decentralized finance.
Overall, the combination of profit-taking, macroeconomic headwinds, security incidents and shifting investor preferences created a challenging environment for AI-linked tokens like TAO, leaving prices lower as market participants reassess risk and positioning.