Bittensor Proposal to Reconstruct the Revenue Model: Validators or Transition to "Fund Managers"

Odaily Planet Daily reports that a new governance proposal for the decentralized AI network Bittensor, called "Root Reborn," is attracting attention. The proposal was submitted by developer "unconst" and is currently under code review, not yet implemented on the mainnet.

It is reported that the plan aims to overhaul the TAO staking reward distribution mechanism, transforming validators from passive reward distributors into capital allocators similar to "fund managers." Under the current mechanism, the system sells rewards owed to root layer stakers and automatically exchanges subnet tokens for TAO to pay rewards. This process is considered to exert continuous selling pressure on the prices of subnet tokens. The "Root Reborn" proposal suggests that validators can choose which subnets to support and reinvest the originally sold rewards into these subnet assets, forming a compounding asset portfolio. Stakers can still earn rewards and can exit at any time with TAO.

The proposal aims to turn ongoing selling pressure into structural buying, while enabling validators to take a more active role in capital allocation, thereby strengthening high-quality subnets and weakening low-quality projects.

However, the proposal is still under review on GitHub. Early automatic reviews have identified risks such as large-scale data processing bottlenecks and potential impacts on staker settlements when subnets are shut down. The developers stated that these issues have been fixed and further optimizations will be made before mainnet deployment.

Market data shows that TAO has fallen about 28% over the past 12 months, compared to approximately 38% for Bitcoin during the same period. The current annualized staking yield is about 17%. (CoinDesk)