TAO

TAO is the base currency of Bittensor. It is staked with validators to earn dividends and influence Yuma Consensus, it pays for transaction fees on the blockchain, and it gets injected into subnet pools as liquidity (forming one side of every subnet's TAO/ALPHA token pair).

While ALPHA tokens are the direct reward for miners, validators, and subnet owners within each subnet, TAO is what connects all subnets together. Every subnet's ALPHA token is bought and sold through its pool using TAO, making TAO the common denominator.

TAO has a fixed maximum supply of 21 million tokens. New TAO is created each block (approximately every 12 seconds) and emitted into subnet pools. The starting emission rate is 1 TAO per block, producing approximately 7,200 TAO per day.

The emission rate decreases as more TAO enters circulation. This follows a continuous halving curve, when half the total supply has been emitted the per-block emission drops to roughly half. When three-quarters has been emitted, it halves again. This continues until the full 21 million supply is reached, at which point no new TAO is created.

The root subnet (subnet 0) is the only subnet where TAO is staked directly without being exchanged for another token. Staking TAO on root with a validator entitles you to ALPHA dividends from every subnet that validator validates, which can be claimed as ALPHA or swapped back to TAO through root claim.