A Bittensor Developer Disposed of 37,000 TAO Cryptocurrency and Departed from the Network: Is a Governance Crisis on the Horizon?

The Bittensor TAO cryptocurrency is currently trading around $249, having decreased by over 4.5% in the last 24 hours and is nearly 68% below its all-time high of $767.68, following one of the most significant governance crises in the project’s history.

The concern extends beyond just the potential for price recovery; it also involves the restoration of trust. The sudden withdrawal of Covenant AI from the network has revealed a vulnerability that cannot be assessed through technical analysis alone.

On April 11, Covenant AI announced its departure from the Bittensor subnet, alleging that co-founder Jacob Steeves exerted excessive control over governance.

This announcement sparked immediate panic selling. Analyst Michaël van de Poppe pinpointed the main catalyst: Covenant’s founder sold 37,000 TAO into the market, triggering a wave of liquidations that caused TAO to plummet nearly 25% from $330 to a low of $265.

Bittensor is rebuilding
Stronger than before https://t.co/7i3h8lQWs0 pic.twitter.com/FqfhxpiCpg

— Mars (@infinitetensor) April 14, 2026

The team has since introduced the Teutonic-I update and governance proposal BIT-0011, aimed at preventing coordinated subnet exits from causing similar sell-offs.

The crucial question now is whether these measures will be sufficient to stabilize sentiment. Broader conditions in the cryptocurrency market further complicate TAO’s recovery timeline.

Can Bittensor (TAO) Crypto Price Recover Above $281 or Is Another Leg Down Coming?

TAO is currently testing a vital support range in its recent history: the $250–$263 zone. The technical outlook appears bearish, with the daily MACD showing a distinct bearish crossover, the token having rejected a multi-month descending trendline on two occasions, and the latest swing high ($390) forming a lower high after the peak of $475.

Social media mentions have surged by 340%, and search interest has increased, a trend that historically precedes sharp two-way movements rather than clear directional trends.

The current situation for TAO crypto hinges on whether confidence can be restored or continues to decline. If governance stabilizes and the proposal is approved, sentiment could shift rapidly, allowing the price to reclaim $281 and potentially move towards $330, thereby revitalizing the entire AI narrative surrounding it.

Source: Tradingview

However, realistically, rebuilding trust takes time, so the price is likely to fluctuate between $250 and $281 as buyers gradually absorb selling pressure while the market awaits clearer signals.

The risk remains that if the situation continues to worsen, particularly if more subnets exit and governance issues persist, the $250 support level could become vulnerable. A break below this level on a higher timeframe could lead to a swift decline towards the low $200s or even lower if panic ensues.

With a market capitalization of $2.55 billion and ranked #38, TAO is not a marginal project. However, at present, price movements are primarily influenced by governance developments rather than technical factors.

LiquidChain Targets Early Mover Upside as Bittensor Tests Key Levels

The governance crisis faced by TAO serves as a reminder that decentralized infrastructure is only as robust as its coordination layer, and even projects with strong AI narratives can suffer due to structural trust failures.

For traders observing TAO’s decline through support levels, the risk-reward assessment at current prices is genuinely ambiguous. This uncertainty is leading to a shift towards earlier-stage infrastructure projects where entry prices still offer significant upside potential.

LiquidChain (LIQUID) is a Layer 3 infrastructure initiative currently in presale at $0.01449, having raised $673,819.16 to date.

The primary proposition is to integrate liquidity from Bitcoin, Ethereum, and Solana into a single execution environment, referred to as a Unified Liquidity Layer. Developers can deploy once and access all three ecosystems simultaneously, with sub-second finality and verifiable settlement incorporated into the architecture (a crucial detail as cross-chain complexity becomes a significant bottleneck in DeFi).

Institutional interest in cross-chain infrastructure is on the rise. Presale assets carry considerable risk, including illiquidity and the potential for total loss; it is advisable to conduct your own research before investing.

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The post A Bittensor Developer Dumped 37,000 TAO Crypto and Quit the Network: Is the Governance Crisis Just Getting Started? appeared first on Cryptonews.