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Fantom Foundation Launches Testnet for Fantom Sonic
Dinarian888
October 24, 2023
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We are thrilled to announce Fantom Sonic, the latest breakthrough upgrade to Fantom that will scale the network to new heights.

With a brand-new virtual machine, improved database storage, and optimized consensus, Sonic is anticipated to achieve 2,000+ transactions per second (TPS) at an average finality of one second while consuming a fraction of the storage used by its predecessor, Opera. The upgrade is the latest step in Fantom’s mission to improve its underlying platform without resorting to sharding or additional layers.

Today, we are releasing access to the Fantom Sonic testnet environment to give users and developers a first-hand experience of the groundbreaking speed offered by the upgrade before its mainnet release, which is scheduled for spring 2024. Scroll further to learn more about Sonic and instructions on how to use the testnets.

What is Fantom Sonic?

Fantom Sonic is the name that covers the new Fantom technology stack, replacing the previous Opera. The new technology stack is included in the new Fantom Sonic Client that validators and other nodes will run to power the network, which comprises mainly the Fantom Virtual Machine, Carmen database storage, and an optimized Lachesis consensus mechanism. In other words, Sonic is the next iteration of the Fantom network, with no hard fork required for the upgrade. Existing smart contracts, services, and tools on Fantom Opera should be fully compatible with mainnet Fantom Sonic.

In unison, these three upgraded components elevate Fantom to unprecedented levels and allow the network to achieve an anticipated 2,000 TPS at a finality of around one second with up to a 90% reduction in storage, putting Fantom far ahead of its peers. Learn more about these components in technical detail further below.

As users continue to embrace blockchain-powered applications, a single popular application can slow an entire network. Sluggish performance of the network prevents the overall adoption of emerging decentralized applications. With its innovative technology, Fantom will allow new markets to adopt blockchain technology previously hindered by limited transaction throughput and slow finality.

We envision a new era of DeFi platforms, blockchain games, high-frequency oracles for perpetual trading, and many other applications that can leverage the speed and scalability of Sonic. Additionally, due to the significantly reduced storage requirements, it will be far more affordable and accessible to run a node on Fantom to partake in network consensus or provide data to dApps.

Sonic testnet environment

The Fantom Sonic testnet environment consists of two separate testnets to demonstrate the upgrade before its mainnet release. The closed testnet aims to showcase the maximum theoretical limits of Sonic, whereas the open testnet is interactive, allowing any user to experience Sonic directly.

Closed testnet

The Sonic closed testnet is observable to the public but does not allow users to submit transactions. A web dashboard shows the maximum performance of Sonic, such as transactions per second, time to finality, average block time, and more.

The dashboard shows that the closed testnet Sonic can process around 2,048 TPS with end-to-end transaction confirmation times (finality) of around 1.1 seconds. At the time of writing, the testnet is processing over 175 million transactions per day, showing the stability of the network even when driven to its limits.

In the closed testnet, a transaction feeder submits synthetic transactions and drives the network to its maximum performance. The transaction feeder is throttled when transaction finality rises beyond roughly 1.1 seconds, which occurs when transactions per second surpass roughly 2,048.

There is no room for public interaction in this testnet setup as the transaction feeder drives the network to its maximum performance. The synthetic transactions resemble transactions on the current Fantom mainnet with an average of 210,000 gas. The workload is distributed roughly as follows:

 

The closed testnet uses an evenly spread stake of 10 million FTM per validator. With 21 validators, the total stake is 210 million FTM. The required consensus quorum is two-thirds of the validators plus one, with a stake of 140,000,001 FTM. The consensus mechanism requires at least 15 validators to confirm blocks for this setup.

We will compare this to the Fantom mainnet, on which the stake is non-uniformly distributed. The total stake on September 25, 2023, at 2:00 PM UTC was 1,379,985,181 FTM. With these numbers, a quorum is reached by a minimum of 919,990,122 FTM. The combined stake of the top 14 validators is 926,970,795 FTM, which was sufficient to confirm blocks with one less validator than the Sonic closed testnet. As such, the closed testnet mimics the consensus of mainnet closely to demonstrate a realistic performance.

With this setup, the closed testnet achieves above 2,000 TPS with a finality of around 1.1 seconds and over 400 million gas per second. This is far beyond the achievable performance of the current Fantom mainnet, which sits at around 30 TPS. There will be a significant reduction in disk space requirements for validators and archive nodes. Currently, for approximately 518 million transactions, an offline pruned validator requires 1,194 GB (i.e. offline pruning removes historical states by stopping the validator), whereas Sonic with online pruning requires 351 GB only. Similarly, archival nodes require 10,893 GB on Opera but only 1,000 GB on Sonic.

We will upgrade and maintain the closed testnet with Fantom’s latest technology regularly. Hence, the closed testnet will be reset every two weeks.

Open testnet

The Sonic open testnet allows anyone to interact with Sonic by submitting transactions and experiencing the true speed the new Fantom upgrade offers.

Similarly to the closed testnet, the open testnet has a transaction feeder that submits synthetic transactions. However, it submits 130 TPS at an end-to-end finality of around 0.6 seconds, which leaves ample throughput for user interactions.

The open testnet dashboard allows users to search for addresses, transactions, and blocks. Note that the open testnet’s history will be retained for longer than the closed testnet’s history. Furthermore, it is possible to deploy dApps on this testnet with a few limitations: the client source code currently is unavailable, and there is no full explorer similar to FTMScan and no transaction tracing support on our public RPCs. 

The tutorial below covers the instructions to interact with the open testnet.

How to use Sonic testnet

Follow this tutorial to unveil the capabilities of Sonic and experience the next generation of blockchain technology. We use MetaMask in this tutorial, but any wallet that can mimic MetaMask will work.

  1. Connect wallet
    1. Go to the Sonic open testnet dashboard
    2. In the top-right corner, click on Connect
    3. Choose your desired wallet account and connect
    4. Go to the account page, unless automatically redirected
  1. Configure network
    1. In the Network section, click on Add to MetaMask
    2. Ensure the network details in your wallet match those on the web page
    3. Approve the action in your wallet and click Switch network when prompted
  1. Get testnet tokens
    1. In the Faucet section, choose a token to request
    2. Click Request and sign the transaction in your wallet
    3. We recommend requesting Fantom for gas and various other tokens to test the swapping feature
  1. Use Sonic Trade
    1. In the Sonic Trade section, choose a token to swap for another token
    2. Click on Swap and confirm the transaction in your wallet
    3. Witness the incredible speed of Sonic!

Behind the scenes

A range of technological innovations have been introduced to enable Sonic to scale Fantom beyond its current potential. This section will provide a more in-depth technical overview of these innovations.

Fantom Virtual Machine

Sonic uses a new virtual machine that achieves superior execution performance compared to the previous Ethereum Virtual Machine implementation.

The Fantom Virtual Machine (FVM) converts EVM bytecode of smart contracts seamlessly into a new virtual machine format on the fly (while executing transactions). Deployed smart contracts that are available only in EVM bytecode remain executable without retranslating the high-level source code (e.g. Solidity) into the new virtual machine format.

The new virtual machine format accelerates the execution of single operations and permits super instructions, optimized bundles of commonly occurring instruction patterns. Super instructions comprise multiple instructions that are consolidated and executed as one instruction, reducing the instruction dispatch time of the virtual machine. The conversion from EVM bytecode to the new format of the FVM is cached, such that subsequent executions of the same code reuse the previously converted EVM bytecode, saving execution time.

The FVM supports caching of cryptographic hashing for the EVM instruction SHA3. Cryptographic operations, especially hashing, are computationally expensive. Repetitive calculations of the identical hashes can occur due to contract operations, state changes, or transaction verifications. By caching previously computed hashes, the FVM can bypass the need to recalculate the same values, saving time and resources. 

Additionally, the FVM supports the caching of JUMPDEST analysis results. In the virtual machine, there are special instructions called JUMP and JUMPDEST. The JUMP instruction allows the code to leap to different locations, while JUMPDEST marks safe places for these jumps to land. The JUMPDEST analysis pre-scans the bytecode to map out all these safe landing spots. By doing so, the FVM ensures that during execution, any jumps are directed only to legitimate and safe points in the code, optimizing performance and increasing security against potential malicious manipulations.

Block processing intense operations, such as synchronizing a new validator with up to 65 million blocks from the first block, can take up to four weeks with Opera. Sonic’s advanced block processing, which includes the FVM and new database storage, can synchronize a new validator in less than two days entirely for the full range from scratch.

Carmen database storage

Sonic uses a new database storage, called Carmen, which reduces node storage requirements and improves performance. Carmen is a new StateDB that stores the world state of Fantom’s blockchain. The world state contains account information, such as balance, nonce, EVM bytecode, and persistent storage of smart contracts.

Carmen features implicit live pruning. Pruning refers to discarding historical data that is no longer needed, which is essential due to a growing blockchain with increasing storage demands. Previously, pruning required nodes to be offline, which burdened validators with financial and operational risks due to their temporary lack of network rewards and the pressure to restart the client software successfully after offline pruning. However, unlike on Opera, validators now can leverage live pruning to remain operational around the clock, preventing disruptions. Consequently, validators will require smaller disks that can yield savings of up to 65% using Sonic’s new database storage.

We achieve live pruning by specializing the database into two types: the LiveDB and the ArchiveDB. The LiveDB contains the world state of the current block only, whereas the ArchiveDB contains the world states of historical blocks of the blockchain. The diagram below shows the interaction of LiveDB and ArchiveDB with the block processing.

The FVM interacts with the LiveDB and the ArchiveDB. As mentioned, the LiveDB contains only the current world state and is optimized for progressing the world state from one block to the next. Validators only have a LiveDB but no ArchiveDB. The FVM reads and writes the data in the LiveDB. In contrast, archive nodes have the LiveDB and ArchiveDB to stay synced. They process requests of historical states via the RPC interface. Its data is read only by the RPC server, and the FVM adds the world state of new blocks.

This specialization of LiveDB and ArchiveDB has been a performance-critical insight for an efficient StateDB design and implementation. We discovered that the access patterns of validators and archive nodes require different implementation techniques. So far, we have developed five evolutionary steps, so called schemas, for LiveDB and ArchiveDB, which differ in how the world state is structured and stored on disk for LiveDB and ArchiveDB, respectively. The version deployed for the Sonic testnet, Schema 3, offers superior storage performance compared to Opera’s MPT data structure.

Schema 3 uses flat storage, which stores data sequentially instead of tree-like or hierarchical structures like the ones used in the MPT. Its flat storage approach simplifies data retrieval. Importantly, Schema 3 still provides cryptographic signatures for a world state and archive capabilities using an incremental version of a prefix algorithm. All schemas utilize a native disk format rather than storing the world state indirectly via key-value stores (e.g. LevelDB/PebbleDB).

Lachesis consensus mechanism

Lachesis is Fantom’s aBFT consensus mechanism. A consensus mechanism is the engine that receives user transactions and serializes them to form blocks. Lachesis has a peer-to-peer module that exchanges events and a transaction pool module for collecting transactions from users and queuing them for validators.

Sonic continues to use the Lachesis technology of Opera, but it has vastly improved the transaction pool for collecting transactions of users. Optimizing and fine-tuning the peer-to-peer network was essential for sustaining such high transaction throughput with a very low time to finality.

Sonic and Opera comparison

A summary of the key differences between Fantom Sonic and the Opera mainnet is shown below.

Summary of Sonic

As shown by the performance of the Sonic closed testnet, the mainnet release will bring a groundbreaking blockchain experience, which we have summarized below for a quick overview.

Sonic is anticipated to achieve beyond 2,000 TPS at a finality of around one second. However, as this is the upper limit, the network will offer a far quicker sub-second finality under real-world circumstances. Storage requirements are reduced by up to 90%, which reduces validator node size from around 2,000 GB to 300 GB and non-pruned archival node size from above 11 TB to below 1 TB.

The storage reductions will allow anyone to launch validator nodes at far lower costs with vastly improved synchronization times and live-pruning support. The Fantom Foundation, and other relevant parties, can deploy archival nodes in approximately 36 hours, which previously would take weeks. If a genesis file for a certain block height is available, or an actual copy of an archive StateDB, the synchronization will be even shorter.

The Sonic mainnet is scheduled for spring 2024, which will transport Fantom into a new era of blockchain technology.

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Dinarian888@dinarian888
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How USDC Wins the Hyperliquid Deal🤔
 
USDC "wins" the Hyperliquid deal by securing dominant distribution and deeper integration into one of crypto's fastest-growing on-chain perpetuals platforms, in exchange for sharing most of the USDC reserve yield (up to ~90%) back with Hyperliquid.
 
Background on the Deal: Hyperliquid had ~$5–6B in USDC deposits (a huge chunk of total USDC supply, often cited around 7–8%). Previously, the interest/yield on those reserves (~$180–250M annually at prevailing rates) mostly flowed to Circle (issuer) and Coinbase (key partner/treasury handler), with little returning to Hyperliquid.
 
In late 2025, Hyperliquid ran an RFP for a native stablecoin (USDH) to capture that revenue. Native Markets won the community vote, and USDH launched as an "Aligned Quote Asset" (AQA).
 

In May 2026, Native Markets sold USDH brand assets to Coinbase. USDH is being sunsetted over time (with feeless conversions/redemptions to USDC/fiat), and USDC becomes the primary/official Aligned Quote Asset on Hyperliquid. Coinbase acts as the main treasury deployer; Circle handles minting, redemptions, and cross-chain (e.g., CCTP).

 

How USDC Wins: 🔑 Key Advantages

Massive, sticky distribution in a high-growth venue: Hyperliquid is a leading on-chain perp DEX. USDC gains preferred status as the quote asset for most trading pairs, reducing friction vs. bridging/swapping other stables. This concentrates liquidity, improves efficiency, and funnels more capital flows through USDC.

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  • Longer-term consolidation play: Analysts see this as part of stablecoin market consolidation around established players with liquidity and infrastructure. Fewer conversion layers = better efficiency for USDC.
     

The Trade-Off (and Hyperliquid's Win)Hyperliquid gets ~90% of the reserve yield (estimates: $135–160M+ annually at current balances, potentially scaling to $300–500M with growth), funneled into protocol revenue/HYPE buybacks. This is roughly double what they got from USDH and turns stablecoin balances into a resilient revenue stream (less volatile than trading fees).

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Dinarian888@dinarian888
May 17, 2026
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Handshake Wants to Be the Front Door to Bittensor’s Agent Economy

In this Beanstock interview, Harry Jackson of Subnet 58 (Handshake) lays out a thesis that’s worth understanding even if you never buy a single SN58 alpha token. He also explained where Bittensor’s agentic layer is heading.

We wrote the high-value distillation:

The one-line thesis

Handshake wants to be the front door to the agent economy on Bittensor. The Amazon-like gateway where AI agents discover, pay for, and stack together skills from across all 128 subnets.

Why this matters now
  • There’s a critical distinction Harry emphasized: AI is intelligence, but agents need tooling. An LLM without payment rails, plugins, and workflow infrastructure is “a young person trying to cut a tree down with a pen knife.”
  • Agent-to-agent commerce is on the edge of going viral. Harry’s prediction for the tipping point: a woman in her 40s lets her agent do her shopping end-to-end (research, stock check, autonomous payment), posts it to social media, and it becomes the “four-minute mile” moment everyone copies.
  • Bittensor is uniquely positioned because agents don’t care about marketing or pretty UIs. They only care about best-in-class products and services. That’s exactly what Bittensor’s 128 subnets produce.

The product reality (what’s currently shipping)

  • Handshake is live with paying users generating a few thousand USD in revenue as of today. The business model: 2% of every transaction on the platform.
  • The flywheel is Amazon-like: better skills → more agents arrive → providers get distribution → more skills get added → cycle repeats.
  • The headline product on the way is Axiom. This is an agent that trades subnets while you sleep. Built around the realization that what the Bittensor community wants from agents isn’t generic skills; it’s more TAO. Each “hole” they find in the agent becomes a new tradeable skill on the marketplace.

The investment angles (read these carefully)

  • The moat is data, not distribution. Every workflow run by an agent generates failure data, success data, payment data. No outside competitor can replicate that without running the marketplace itself.
  • The metric Harry tells you to judge them on is revenue. Not agent count. Not user count. Revenue, which is publicly visible on-chain via the front page of their site. He’s basically inviting investors to hold him to it.

  • The pitch for emissions: the biggest TAM in Bittensor is the agent market, and Handshake is the most integrated subnet, meaning if Handshake wins, the subnets it routes to all win too. Bullish on agents + bullish on Bittensor = bullish on Handshake by transitive logic.

Where Harry stands on the Conviction

  • On the conviction upgrade and locked alpha: he’s fine with it. Handshake is a revenue-focused company, so locked alpha isn’t a survival issue. He acknowledges it’ll be harder on research-stage subnets that need to raise external capital, but argues most subnet founders are thinking long-term, not short-term extraction.
  • On the broader vibe: he just got back from Bittensor events in Spain and San Francisco. He observed that the overwhelming reality of the ecosystem is people working hard to build the best products. “It’d be a lot easier in some ways to build a company outside of Bittensor.” The only reason to do it on Bittensor is if you actually want the moonshot.

Full interview below:

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Dinarian888@dinarian888
May 10, 2026
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🚨The State Of Bittensor (TAO)🚨
Greg Schvey | COO at Yuma Group

Last week at the @YumaGroup Summit I had the opportunity to present on The State of Bittensor. That presentation is in the thread below. If you choose to read it, I'd ask that you keep the following three things in mind:

  1. This is just one guy's view of what was the most relevant for a 25-minute talk; a difficult filter for such a dynamic industry.
  2. The slides were designed to supplement a talk; I've done my best to replicate what I recall of the talk in the accompanying X posts.
  3. The topic of the Summit was "The Tipping Point" - a candid assessment of what could lead to Bittensor's breakout success and what evidence we see of that today - which also thematically anchored this presentation.

Let's dive in:

We are in the most important race in human history – the race for intelligence itself. AI has advanced beyond the point of no return. As an example of what I mean: Ramp is a widely used financial services platform for companies. They looked at spending and revenue across their clients since the launch of ChatGPT: Companies who did not spend on AI have had flat revenue for the last three years. The top quartile of AI spenders have grown revenue by more than 100%.

We are already at the point where investing in AI is a matter of survival. But what exactly are we getting for the hundreds of billions being spent? Right now, its overwhelmingly going to corporations who have repeatedly shown they don’t have our best interest in mind.

 

 

Claude Opus 4.6 – the leading deep thinking model, had a measured hallucination rate of 16% in February. Then, without telling anyone, Anthropic throttled its reasoning – presumably to reduce GPU utilization – and didn’t tell anyone. Hallucinations climbed to 33% - a 98% increase.

They only admitted it after third party benchmarking proved it. And they were still charging everyone at the same price the whole time. Even since my talk last week, they've supposedly been found to be throttling people simply because HERMES.md was in their commits. You may say, "well there are solid open source options..."

 

 

Yes, open source models have gotten very good, but they’re not immune to capture either. Try asking DeepSeek what happened in Tiananmen Square and then let me know if that’s the intelligence you want to trust.

 

 

This needs to be addressed right now or it will be too late. To give you a sense of what I mean, this is a chart of the total annual commits on GitHub. That’s 500% growth since the launch of ChatGPT in 2022. From 200M per year to a one billion in 2025. 2026 is on track for **14 billion** The genie is out of the bottle – there is no going back; we are already at the exponential inflection point.

This reminds me of many years ago: Bitcoin shined a light on how much our rights were impacted when we became dependent on private companies to run our day-to-day lives.

Your right to privacy? That doesn’t extend to your bank account. Your "money" is just a ledger at a private company, available for interrogation and suspension at any time. Bitcoin gave us back the sovereignty of our wealth.

Similarly, we’ve depended on things like privacy of our medical records and attorney client privilege for our entire lives. What do you think is going to happen when a private company’s servers are giving you legal and medical advice? Who are you going to trust for that intelligence? The company that lobotomized its top model? The model constrained by the foreign governments? As I said at the beginning, we’re in the most important race in human history and Bittensor well may be our best shot at winning.

 

 

One of the things about having a different model to produce intelligence is it requires an economic system suited to it. Subnets are the intelligence and economic engines that drive Bittensor’s value. That’s why the Summit was themed around The Tipping Point: understanding how subnets can reach breakout success and what we can do to help.

To summarize Bittensor's intelligence economics: miners create intelligence for which they earn subnet tokens. In many cases they sell those tokens to fund operations, putting downward pressure on token prices and decreasing the incentive to mine (similar to bitcoin). In parallel, if that intelligence is being used to generate real world value, one of the parties who benefits from that value (e.g. the Operator monetizing it, institutions using intelligence commodities to advance their research, etc.) can buy the subnet tokens to keep token prices elevated and sustain the miner incentive.

Investors get to participate in this process, often supporting token prices before the commercial value of intelligence is realized, and/or subsequently holding an asset that parties gaining fundamental value from the intelligence (eg Operator or others) will need to purchase at some point in the future if they want to maintain sufficient incentives for the intelligence machine to continue running.

For Bittensor to succeed, this value loop has to work. So, to understand the State of Bittensor, we have to take a look at how that’s going today and what that means for the network overall.

 

 

One of the many unique features of Bittensor is that subnets are native to the protocol. That is not the case on most crypto networks where the true utility lives in smart contracts with no direct tie to network value.

As an example, Polymarket has seen 800% growth in volume this year. Users can bet any arbitrarily large amount of value on Polymarket for a few cents of network fees. There is nothing tying that to value of the network’s native token, which is down 80% over the same period as Polymarket’s amazing success.

 

 

Conversely, Bittensor subnets are intrinsically linked to $TAO. If you want $1,000 worth of subnet exposure, you first need $1,000 of TAO. We analyzed subnet pool data surrounding the announcement of @tplr_ai's recent training run and normalized across them by indexing them to a starting level of 100.

As shown by the orange line, there was no material change in pool size for non-Templar subnets over the observation period. There was however, major inflow into Templar’s pool. Given Bittensor’s unique network model, we saw a direct correlation to the change in TAO price over the same period. As value flows into subnets, the whole network benefits. A rising boat lifts the tide, so to speak.

 

 

That can go both ways. When Sam left, we saw something similar in reverse; as value was exfiltrated from the network, it started in Covenant subnets and dragged TAO down with it. You know what else we saw in the data though? For all of the noise about concerns of Bittensor’s future, the other subnet pools were mostly unchanged.

The event was interesting because it reminded me of the early days of bitcoin: people would say Bitcoin was only used by drug dealers on the internet. I'd stare at them aghast because in the same breath they told me that an open, permissionless network was used to reliably move money anywhere in the world in minutes by the most untrustworthy people on the planet and yet they didn't understand how the technical feat required to achieve that would create tremendous value.

The Covenant situation is similar: people were concerned about the operator's exit, rather than realizing the only reason we care is because a ground-breaking technical innovation was achieved. But even bigger than that: Bittensor has 128 subnets currently, each striving to generate value for themselves and, transitively, the network as well.

 

 

And we’re seeing that occur – Templar was not unique in that regard. The same pattern emerged around the Intel publication on @TargonCompute. The non-Targon pools remained largely unchanged. Targon saw heavy inflows. TAO price climbed with it.

Again: rising boats lift the tide. And there are many boats in Bittensor right now.

 

 

We’re seeing major technical innovations at an increasing rate.

Just a few examples from the last couple weeks:

@QuasarModels just announced a custom attention architecture targeting 5M token context windows.
 
@IOTA_SN9 developed a technique that compresses data flowing between distributed GPUs by 128x with little to no loss in training quality, increasing viability of training large AI models across internet-connected machines worldwide.
 
We're seeing the building blocks start to form whereby competitive large generalized models can eventually be built. In the meantime, we're also witnessing more targeted, niche players start to pull ahead in their respective fields.
 
During the presentation, I gave the example of @resilabsai achieving 90% accuracy on their home valuation model, making it the most performant open source model and quickly approaching state of the art. Quite literally as I was explaining this during the talk, @markjeffrey pointed out they had just achieved 98% accuracy.
 
In the time between when I prepared the presentation and actually presented, they went from best open source to at or near state of the art - only further highlighting the unique value of Bittensor's open, competitive intelligence creation cycle.
 
 
And the tech that’s being built on Bittensor is getting real attention from serious players. Again, just a few examples of many: Harvard partnered with @Chutes on research about AI inference efficiency. Valeo – an auto company with $20B in annual revenue – is working with @natix on an AI model for self-driving cars. @zeussubnet- the weather forecasting subnet, is the only party in the world allowed to use data WeatherXM’s network of global weather sensors for commercial purposes. And there are in fact many subnets already commercializing their intelligence.
 
 
 
Most of us are already aware of Chutes seven-figure ARR, but a few other examples:
 
@LeadpoetAI– which uses their Bittensor subnet to source sales leads, announced earlier this year that they crossed $1M ARR
 
@Bitcast_network– the content creation platform built on their subnet competition – is already operating profitably
 
@lium_io– a hardware subnet – has bought more than 4,000 TAO worth of their token
 
Remember the economic model I outlined earlier; we’re seeing real evidence that it’s starting to work across many subnets. Intelligence built on Bittensor, capturing value in the real economy, and bringing it back into the network.
 
Action shot of this slide courtesy of @Tom_dot_b
 
 
That’s why when we look at Bittensor we like to look at Total Network Value (TNV);
$TAO market cap is only part of the story in Bittensor. TNV = market cap of TAO + market cap of subnets – tao in the pools [as not to double count] The actual value of this network is already higher than most people realize. And notably, subnets make up an increasing proportion of TNV – recently crossing 35% - as value continues to flow into the pools.
 
 
 
Interestingly, we recently noticed a change in TNV: In particular, despite all the volatility in TAO, the dramatic subnet issuance curves, etc. - the combined subnet market cap had been remarkably consistent around $750 million for most of the last year, until recently.
 
It’s nearly doubled over the last few months – a clear breakout in the trend. If you were looking for Tipping Point, it might look something like this...
 
 
 
I hear a lot that that value is relatively concentrated in the largest subnets. And the market cap distribution does indeed reflect that, but that’s not necessarily a bad thing.
 
 
 
This is the market cap distribution of the S&P 500. Many healthy economic systems tend towards Pareto distributions. And so what if some subnets are worth more? As we showed earlier, this is an ecosystem that will win or lose *together* And we’re seeing that play out every day.
 
 
 
We track announcements of subnets utilizing each others infrastructure and intelligence. Just as an example, we identified at least eight subnets who announced that they use Chutes for inference. But we have dozens of similar examples of cross-subnet collaboration across many subnets like
 
What’s notable about this:
 
1. Collaboration seems to be happening at an increasing pace as subnets continue to mature and build out contiguous pipelines of AI infrastructure
 
2. Keeping money circulating within an economy creates a money multiplier. Capital circulating within a single economy without leaving creates economic value for each party it passes through, without having to bring in new capital. That’s uniquely possible here because of the diversity of infrastructure built on Bittensor.
 
This network is not 128 discrete growth drivers; it’s increasingly functioning as an interconnected graph, which has substantially more stickiness and value And the pace is about to increase dramatically:
 
 
 
We’re starting to see increasing agents operating on Bittensor: subnets mined by agents, subnets operated by agents...
 
Consider the Bittensor value flywheel:
 
-An intelligence goal is established
-Miners compete to achieve the goal
-That produces intelligence
-Intelligence generates value
 
That’s happening today, as we’ve seen earlier in this discussion.
 
As agents get more capable, that flywheel spins faster and faster. Permissionless entry means any agent can compete. Protocol-native economic incentives mean good work gets rewarded. Bittensor is uniquely advantaged for agentic speed over guarded, centralized alternatives with corporate procurement cycles.
 
That also means exploits will be found faster. But, it also means solutions that harden the network against them will be found faster as well.
 
Accordingly the impact of the network primitives – incentives, accessibility, governance, security, reliability, and all the infrastructure we’re building around the network - have an exponentially larger impact. It is critical that we get these right. The time to nail this, is right now. If we don’t someone else will.
 
 
 
The good news is, for now, Bittensor seems to be in the lead The 30-day moving average of Daily active wallets just crossed a record, approaching 10,000 Up 100% just in the last year.
 
 
 
We’re also seeing subnet ownership increasingly diversify and distribute. The median number of holders of subnet tokens at 2,000 is a 10x increase since the dtao launch a year ago. And at Yuma, we spend a lot of effort and resources to help broaden that access.
 
 
 
Yuma currently partners with 16 custodian and wallet providers to bring Bittensor access to the masses As an institutional-grade validator, the relationships and service we offer give them the confidence to make TAO staking available to millions of end users.
 
During the Summit, we announced that BitGo’s clients will now have access to subnet token staking through our partnership, making subnet investing available to customers of one of the world’s largest custodians.
 
 
 
We also help people gain access to subnets via investment vehicles. The Yuma Composite Fund gives investors access to a market-cap weighted portfolio of subnets through traditional investment structures. The Yuma Large Cap Fund gives investors concentrated exposure to Bittensor's largest subnets.
 
Our institutional asset management team handles everything from initial subnet token purchases, to portfolio rebalancing, custody, and reporting. The appeal for institutions is obvious, but even for the Bittensor native, it’s an amazingly simple way to get access to a broadly diversified portfolio, rebalanced regularly.
 
Between the breakout performance of subnets, the attractive staking rewards, and benefits of diversification, the Yuma funds have outperformed TAO materially year to date [as of when the presentation was created] Nearly 3x outperformance relative to TAO.
 
 
 
And last but definitely not least, our subnet accelerator has helped a wide range of companies access Bittensor. We help them acquire subnet slots, design incentives, provide marketing assistance, review pitch decks, make introductions to other investors, etc. At Yuma we deeply believe in the power of subnets and have helped many of the network's leading intelligence providers start and succeed.
 
 
 
Disclaimer: For informational purposes only.  Nothing herein should be construed as financial, investment, legal, or tax advice.  This material does not constitute an offer to sell or a solicitation of an offer to buy any securities or tokens.  Investing in digital assets involves significant risk, including the potential loss of principal.  Subnet tokens do not represent equity or ownership interests in any entity.  Performance comparisons and index references are illustrative only and not indicative of future results.  Charts and indices are based on methodologies and assumptions that may change and may not reflect actual market conditions or liquidity.
 

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