Bittensor Proposal Restructures Reward Mechanism: Validators May Transform into "Fund Managers"

Odaily reports that a new governance proposal for the decentralized AI network Bittensor, named "Root Reborn," is attracting attention. Submitted by developer "unconst," the proposal is currently in the code review stage and has not yet been implemented on the mainnet.

According to reports, the plan aims to restructure the TAO staking reward distribution mechanism, transforming validators from passive reward distribution nodes into capital allocators akin to "fund managers." Under the current mechanism, the system sells rewards owed to root-level stakers and automatically converts subnet tokens into TAO to pay out yields. This process is believed to create constant selling pressure on subnet token prices. In contrast, the "Root Reborn" proposal suggests that validators can independently choose which subnets to support and reinvest the rewards that would otherwise need to be sold back into these subnet assets, forming a portfolio that can generate compound growth. Stakers will continue to receive yields and can exit in TAO at any time.

The design of the proposal aims to convert sustained selling pressure into structural buying power, while allowing validators to play a more active screening role in capital allocation, thereby strengthening high-quality subnets and weakening low-quality projects.

However, the proposal is currently still in the GitHub review stage. Early automated reviews have identified risks such as large-scale data processing bottlenecks and the potential impact on staker settlements if a subnet shuts down. The developer has stated that the related issues have been fixed and will continue to be optimized before deployment on the mainnet.

According to market data, TAO has fallen approximately 28% over the past 12 months. During the same period, Bitcoin fell approximately 38%. The current annualized staking yield is around 17%. (CoinDesk)