Subnets are still testing a key support level, with detailed market analysis in this edition of Sapho Report.
Has a subnet found the perfect tokenomics? We take a look at VoidAI and their buyback strategy.
Risk level for subnets
The Sum of Alpha Prices continued its decline and reached 0.99 on October 16. This was the first time in history that it had fallen below 1, triggering mechanisms to support the price and reduce subnet emissions.
This level was quickly rejected: The Sum of Alpha Prices even rose to 1.05. Today, it is back in the 1.02 range. The upward and downward movements were not significant enough to break this range.
In the latest Sapho Report, we presented two scenarios still relevant for the coming weeks:
Clear rejection of the 1.02 level. This must happen with a significant buying volume.
On the other hand, if our 1.02–1.00 zone breaks down with strong volume, it would be very bearish for the long-term trend of subnets.
We repeat, strong price movements are needed to validate either scenario. The Sum of Alpha Prices still has low volatility and is trading within its range.
TAO, the savior?
$TAO is clearly the top performer in the crypto market right now. The token draws attention amid a weak crypto market.
The rise in interest is clear from Google search trends. We can hope that this exposure will bring new liquidity to the subnets in the coming months.
General suffering
We use Mentat Minds indexes. Details on calculation are on this page. Mentat 5 and Mentat 15 cover the leaders, while Mentat 70 gives a wider picture of the subnet market.
The market’s weakness has been clear in recent weeks, as shown by the subnet indexes:
Mentat 5 : −7,05%
Mentat 15 : −7,56%
Mentat 70 : −8,85%
Once again, leaders remain more resilient than the rest of the market.
One team survives the crash
Unlike the market indexes, Rayon Labs subnets have regained strength in recent days.
The index has gained +0.89% over the last two weeks. Given the weak global market, that’s encouraging for Rayon Labs, now emerging from a long decline noted in our last Sapho Report.
Tips of the week: follow Mentat Minds on X. Something's happening.
VoidAI, the perfect tokenomics?
One must hold
VoidAi is in a situation quite similar to the market.
This graph shows the evolution of the subnet since it was taken over by VoidAI on September 8, before that date, the slot belonged to another subnet. The green support level was recently lost (-24.89% between October 3 and today).
The price has fallen to the purple zone level and stay inside for now.
If we look at the graph on a longer scale, this purple range was established before VoidAI took the slot of this subnet, but seems to be working well given the price reaction.
This is the last graphical support level, a key level that must be held in order to remain bullish on the subnet.
Open the doors of Bittensor
VoidAI is a multi-chain liquidity protocol with a built-in bridge that connects Bittensor to other blockchains. The goal: let users move TAO and Alpha tokens to other networks by wrapping them as wTAO and wAlpha. These tokens are tradable and usable in DeFi, bringing fresh liquidity to the Bittensor ecosystem.
VoidAI currently operates on Solana. EVM-compatible blockchains like Base and Optimism will soon integrate through Chainlink, to make Bittensor subnets liquid on major blockchains.
The subnet currently ranks 48th, with a market cap of $4.53 million, a volume of $1.06 million in the last 24 hours, making it the 14th most traded token.
The token is therefore closely watched by investors despite its market cap.
The perfect tokenomics?
We presented models of burn and buyback in our latest editions of Sapho Report.
VoidAI has implemented a very interesting one.
Their mechanism currently covers 10% of Alpha token inflation. Over the past 30 days, wallets labeled as belonging to the subnet have recorded an inflow of 58 TAO and 130 TAO have been burned, while the equivalent of 1,804 TAO in Alpha has been issued. (58 + 130) / 1,804 ≈ 10%.
It’s high for such a young subnet.
What’s interesting is that this number has to go up if the subnet succeeds. We explain why below.
VoidAI creates a real virtuous circle by putting its Alpha token at the heart of its ecosystem.
They needs deep liquidity to operate token pools on other blockchains. The first pairs are already on Solana, but expanding pools and rewarding holders is key for growth.
This is where buybacks come in.
100% of the revenue generated by the bridge and swaps made is used to power their ecosystem, thereby adding value to their subnet.
50% of the revenue funds liquidity pools across all subnets to ensure minimal slippage. Their goal is to have the deepest possible liquidity pools.
50% is used to buy back Alpha, which later increases the liquidity of pools across multiple blockchains.
This strategy creates a clear virtuous cycle:
Usage of wTAO, wAlpha, the bridge and pools brings more revenue.
More revenue allows them to grow liquidity pools through buybacks and direct funding.
Bigger pools attract more volume, increasing fees and revenue.
All new revenue goes back into buybacks and growing pools, making the cycle stronger each time.
The main drawback is operational: revenue management and fund transfers still rely on manual execution by the team. Only buybacks are performed by a bot when funds are sent to the dedicated wallet.
Still, all team wallets remain public and easily traceable on-chain. Revenue flows from Bridge wallet/Vault for trading fees > Bittensor treasury wallet > Buyback bot wallet
VoidAI is positioning itself as one of the leaders in buybacks, with a well-thought-out strategy and a use of revenues that primarily benefits their ecosystem and holders.
Subnets need stability, investors need reassurance. Buybacks seems to be able to rally everyone in order to bring Bittensor to a healthier market.
Thank you for reading this newsletter. If you are interested in the subnet market, please feel free to click on the following link.
Disclaimer: This newsletter does not constitute investment advice. It is a tool designed to help you understand the Bittensor subnet market. Always do your own research before investing.
