Grayscale applies for the first Bittensor spot ETF: Can TAO price break $300 in one month?

The world’s largest crypto asset management firm, Grayscale Investments, has officially filed an S-1 registration statement with the U.S. Securities and Exchange Commission for the Grayscale Bittensor Trust, planning to convert it into a spot exchange-traded fund (ETF) listed on NYSE Arca under the ticker GTAO. This will be the first investment product in the U.S. to offer direct exposure to Bittensor’s native token TAO, marking the first time the AI + crypto frontier narrative enters mainstream capital markets in the form of a compliant financial product.

Buoyed by this news, TAO’s price surged above $223 within 24 hours, and market discussions have begun on whether it can leverage this momentum to challenge the $300 mark by January 2026. The application coincides with the Bittensor network’s first “halving” in mid-December, reducing daily issuance from 7,200 TAO to 3,600 TAO. The contraction on the supply side, resonating with potential demand influx driven by ETF capital, adds a new dimension to TAO’s long-term value narrative.

Milestone Application: How Grayscale is Bringing AI and Crypto Narratives into Mainstream

2025 is dubbed the “Institutional Year” for the crypto market. Despite a sluggish annual price performance for mainstream assets like Bitcoin, traditional financial giants such as BlackRock and Fidelity continue to pour funds into the market via spot ETFs, fundamentally altering market power structures and pricing logic. Now, this institutional wave is expanding from foundational assets like Bitcoin and Ethereum into more segmented narratives with growth potential. Grayscale’s application for a Bittensor ETF epitomizes this trend.

According to the submitted documents, the ETF named Grayscale Bittensor Trust aims to provide investors with a convenient, regulated way to access the native functional token TAO of the Bittensor protocol. The fund plans to list on NYSE Arca, a high-growth exchange. For custody, Grayscale has chosen top-tier compliance providers—Coinbase Custody Trust Company and BitGo Trust Company—to serve as custodians, ensuring high standards of security for incoming institutional capital. Notably, this public ETF application is not Grayscale’s first move on Bittensor; previously, the trust product was available via private placement to qualified investors. The conversion to a listed ETF aims primarily to “broaden product access,” enabling trading on a regulated public market and reaching a wider retail and institutional investor base.

This move is widely seen as a strategic continuation of Grayscale consolidating its leadership as a “provider of institutional-grade crypto investment products.” Having successfully operated the world’s largest Bitcoin trust and transitioned it into a spot ETF, Grayscale is now applying its mature product experience to the next potential growth catalyst. Bittensor is not an ordinary altcoin; it is a protocol designed to build a decentralized machine learning network, allowing researchers and AI models worldwide to train, evaluate, and trade via its blockchain network. Packaging such a complex, cutting-edge “AI + blockchain” project into a familiar ETF product for traditional investors is a symbolic breakthrough—signaling that the previously niche “decentralized artificial intelligence” narrative has gained mainstream financial infrastructure backing and access channels.

Grayscale Bittensor ETF (GTAO) Key Application Details

Applicant and Product: Grayscale Investments / Grayscale Bittensor Trust (Planned to convert into a spot ETF)

Target Exchange: NYSE Arca

Proposed Ticker: GTAO

Underlying Asset: Bittensor network’s native token TAO

Custodians: Coinbase Custody Trust Company, BitGo Trust Company

Timing Context: Several weeks after Bittensor network’s first “halving” (reducing daily issuance from 7,200 TAO to 3,600 TAO)

Current Status: S-1 registration statement filed, awaiting SEC review; fee rates and listing date not yet announced.

Market and Technical Resonance: Halving Meets ETF, TAO Price’s Bull-Bear Battle

Grayscale’s filing is like a stone thrown into a calm lake, creating immediate ripples in TAO’s market price. Within 24 hours of the announcement, TAO’s price broke through and stabilized above the short-term key level of $220, reaching a high of $223, marking a modest increase. The market’s positive reaction is unsurprising, as this event coincides with another fundamental catalyst: the first token issuance halving of the Bittensor network.

Just weeks before Grayscale’s application, Bittensor successfully executed its first “halving” in mid-December 2025, cutting the daily TAO issuance from 7,200 to 3,600. This periodic supply contraction mechanism, similar to Bitcoin’s, aims to control inflation and increase scarcity, theoretically supporting long-term value. Grayscale’s decision to apply for an ETF shortly after the halving is a strategic timing move, allowing the “supply contraction” and “potential demand surge” narratives to resonate simultaneously. The market is beginning to price in the possibility that if approved, the ETF could open a near-unlimited compliant capital inflow for TAO, similar to Bitcoin ETFs. Under reduced supply, any significant demand growth could have a leveraged effect on the price.

However, short-term enthusiasm must be tempered with a more cautious technical analysis. From a technical perspective, TAO’s upward momentum shows no overwhelming strength. Its Relative Strength Index (RSI) is currently at 49.31, slightly below the neutral 50, indicating a balance between buying and selling forces, with traders divided on the next move. The Moving Average Convergence Divergence (MACD) indicator also appears flat, with the MACD line and signal line nearly parallel, and histogram bars close to zero, suggesting a lack of clear trend momentum. Currently, the $220 region is a battleground for bulls and bears, serving as both recent support and a potential springboard for the next move.

For bullish traders, the path upward is clear but challenging. TAO needs to break through and hold above the strong resistance at $250. Success here could open the way toward $280 and ultimately challenge the psychologically significant $300 level. This process ideally completes by January 2026, making the timeframe relatively tight. For bears, if buying momentum wanes and the price falls below $220, it could further decline toward the more critical psychological and technical support at $200. The outcome of this market battle, triggered by a major news event, will depend not only on the ETF narrative but also on macro market sentiment and the actual progress of Bittensor’s ecosystem.

Narrative Value: Why Bittensor is the First Choice for an “AI + Crypto” ETF?

Among thousands of crypto projects, why did Grayscale choose Bittensor as its next product expansion? The core reason lies in the “decentralized machine learning network” narrative embodied by TAO, which hits two major current global trends: artificial intelligence and the value capture of decentralized protocols.

Bittensor has built an open marketplace where AI developers can connect their trained models to the network and earn TAO tokens based on the usefulness and contribution of their models (evaluated via network consensus). This creates a positive feedback loop: better models and greater contributions lead to higher rewards, attracting more high-quality models and enhancing the network’s intelligence and value. TAO acts as the central incentive, payment, and governance token in this ecosystem. This vision of democratizing and marketizing AI development, with blockchain-enabled precise value distribution, makes it stand out among many AI-related crypto projects, with a solid economic model and long-term ecosystem potential.

More importantly, this narrative is highly understandable and attractive to traditional capital markets. Despite the crypto market’s downturn in 2025, global tech investment remains focused on AI—from Nvidia’s chips to various AI applications—capital is chasing any AI-related assets. The potential launch of a Bittensor ETF offers traditional funds, family offices, and individual investors who are optimistic about AI but hesitant or unable to directly engage with complex crypto technologies a standardized “one-click” tool to position themselves in the decentralized AI future. It cleverly translates native crypto innovation into a language Wall Street can understand and trade.

Furthermore, Grayscale’s decision reflects a shift in crypto investment products from “asset universality” to “narrative specificity.” Bitcoin ETFs represent “digital gold” and “macro hedging” narratives, Ethereum ETFs relate to “world computer” and “DeFi,” while Bittensor aims to dominate the “decentralized artificial intelligence” track—an imaginative frontier. In an era where institutional investors increasingly prefer thematic and track-based allocations, securing a compliant product entry into a high-growth narrative has strategic significance.

Risks and Challenges Ahead: From Application to $300 is Not a Smooth Ride

Despite the promising outlook, rational analysis must acknowledge that moving from an ETF application to TAO reaching $300 involves multiple uncertainties and risks. Investors chasing this narrative should be aware of these challenges.

The primary risk is “regulatory approval uncertainty.” Filing the S-1 is just the beginning of a lengthy review process. The SEC will scrutinize whether TAO can be classified as a “non-security commodity,” whether Bittensor’s network is sufficiently decentralized, whether custody and market regulation plans are robust, and whether investor protections are met. While the current U.S. political environment is relatively friendly to crypto, the novelty and complexity of this asset class mean approval could take months or longer. Any delays or setbacks could impact market sentiment and prices.

Second, macroeconomic pressures cannot be ignored. The overall crypto market has been weak in 2025, with Bitcoin even declining since the start of the year. This weakness stems from unpredictable macroeconomic headwinds and risk aversion among investors. If macro conditions do not improve in early 2026, and risk assets remain under pressure, the positive impact of a single ETF may be limited. TAO’s correlation with the broader crypto market, especially Bitcoin, will be tested during downturns.

Finally, the development and competition within Bittensor’s ecosystem are fundamental. While ETF capital and attention can boost the asset, its long-term value depends on the actual utility of the underlying network, developer community activity, and technological progress. Bittensor must demonstrate that its decentralized machine learning network is not just an innovative concept but can produce valuable, competitive AI models and services sustainably. It also faces fierce competition from centralized AI giants and other decentralized AI projects. If ecosystem growth stalls, the ETF’s halo effect may fade, and prices could revert to fundamentals.

Overall, Grayscale’s Bittensor ETF application injects strong momentum into TAO and places it on a broader capital market stage. It creates an excellent narrative window to push from $220 toward $300. However, success depends not only on the smooth progress of this application but also on macro timing, regulatory environment, and ecosystem development—“people and harmony.” For market participants, this is a high-risk, high-volatility frontier experiment in pricing innovative narratives and institutionalization. The outcome will serve as a valuable reference for the entire “AI + Crypto” track and the institutionalization path of altcoins.