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Bittensor Proposes a Restructuring of Its Reward Mechanism: Validators May Become “Fund Managers”
Svmuu News: A new governance proposal titled “Root Reborn” for the decentralized AI network Bittensor is drawing attention. Submitted by developer “unconst,” the proposal is currently in the code review phase and has not yet been implemented on the mainnet. According to reports, the proposal aims to restructure the TAO staking reward distribution mechanism, transforming validators from passive reward recipients into capital allocators akin to “fund managers.”Under the current mechanism, the system sells rewards owed to Root-layer stakers and automatically converts subnet tokens into TAO to pay out rewards; this process is believed to exert sustained selling pressure on the prices of various subnet tokens.The “Root Reborn” proposal, however, suggests that validators can independently choose which subnets to support and reinvest the rewards that would otherwise be sold back into these subnet assets, creating a portfolio capable of compound growth. Stakers will still receive rewards and can exit at any time by redeeming their TAO. The proposal is designed to transform sustained selling pressure into structural buying pressure, while allowing validators to play a more proactive role in capital allocation—thereby strengthening high-quality subnets and weeding out low-quality projects. However, the proposal is currently still in the GitHub review phase. Early automated reviews have identified risks, including bottlenecks in large-scale data processing and potential impacts on stakers’ settlements in the event of a subnet shutdown. Developers have stated that these issues have been resolved and will continue to be optimized prior to mainnet deployment. According to market data, TAO has fallen by approximately 28% over the past 12 months, while the Bitcoin has declined by about 38% over the same period; the current annualized staking yield is approximately 17%. (CoinDesk)
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