What are Bittensor subnets and how do they work?

Each Bittensor subnet is a self-contained market where miners compete to produce a specific output, such as AI model answers or computing power, validators grade them, and the chain pays rewards based on those grades. The wider network and its TAO coin are covered in what is Bittensor.

What is a Bittensor subnet?

According to the Bittensor docs, a subnet is an independent incentive market identified by an integer called a netuid. Its owner, the wallet that registered it, writes the incentive mechanism and sets its parameters.

Participants are called neurons. Miners produce the work. Validators are neurons with enough stake to hold a validator permit, and they score miners by setting weights. A subnet holds up to 256 neurons by default, and permits go to the top neurons by stake, up to 128 by default. Registering a neuron costs a burn fee. When a subnet is full, a new registration pushes out the lowest-ranked neuron that is no longer within its immunity period.

Subnet 0, the root subnet, is different. It has no miners and no alpha token. TAO staked there counts toward validator weight on every subnet.

How does dynamic TAO work?

Dynamic TAO, often shortened to dTAO, went live on mainnet on February 13, 2025, Oak Research reported. Before it, 64 validators on the root network voted on how emissions were split among subnets. Now the market plays that role.

Each subnet has a pool pairing TAO with its own token. Staking into a subnet swaps TAO for that subnet's alpha at the pool price, and unstaking swaps back. The current docs say each block's TAO emission is shared among subnets mainly in proportion to a smoothed (EMA) alpha price, with a gate that trims very small shares. Subnets whose tokens attract more demand tend to receive more TAO.

What are subnet alpha tokens?

Alpha is the subnet's own token, priced in TAO. Each subnet emits up to 1 alpha per block to its participants at the current halving rate, and alpha follows the same halving curve as TAO, counted from that subnet's launch.

By default, rewards are split 18% to the subnet owner, 41% to miners and 41% to validators, who share theirs with stakers. Owners can adjust this within limits set by the chain.

How is a new subnet created or removed?

Anyone can register a subnet by locking TAO, which becomes the subnet's starting TAO reserve rather than a refundable deposit. The docs say the cost doubles each time any subnet is registered and then falls back over about two weeks, never below 1,000 TAO. Only one subnet can be registered per day across the network.

The limit is 128 subnets. Once it is reached, a new registration removes the non-immune subnet with the lowest smoothed alpha price. New subnets are protected for about six months. When a subnet is dissolved, its TAO reserve is paid out to alpha holders in proportion to their holdings. Alpha tokens can lose value quickly, so it helps to research a project before staking.