Key Takeaways
What caused TAO’s sharp 15% fall?
$48 million Derivatives Outflows slashed Open Interest to $270 million, triggering market-wide liquidation pressure.
What signals hint at recovery?
Spot inflows rose $13.7 million, while MFI stayed above 50—showing buyers quietly rebuilding momentum.
Bittensor [TAO] saw a steep 15% drop in the last 24 hours after investors reacted to Grayscale’s consideration of listing the asset. The correction reflected a re-pricing of TAO’s value, yet it drew renewed demand from traders eager to accumulate more.
At press time, TAO traded near $403, recovering slightly from its intraday low near $370. Whether that demand can sustain new highs remains unclear.
Derivatives pressure drags TAO lower
The Derivatives Outflows in the market had been the primary driver behind TAO’s failed rally.
According to CoinGlass data, over $48 million exited derivative positions, cutting Open Interest down to roughly $270 million from its previous peak of around $340 million.
Source: CoinGlass
The overall derivatives Trading Volume Ratio also fell near 0.90, indicating that sellers maintained dominance across Futures markets.
Such conditions historically align with periods of extended price correction, leaving TAO vulnerable to further downside if liquidation clusters expand.
Investors aren’t backing down
Spot investors, however, didn’t back down. Many saw the recent price decline as an opportunity to buy more of the coin.
Between the 14th and 16th of October, Spot addresses accumulated about $13.7 million worth of TAO — a three-day buying streak reflecting confidence in the token’s long-term strength.
Source: CoinGlass
CoinGlass data showed that both Binance and OKX maintained positive Volume Ratios of 2.33 and 1.15, suggesting traders on these venues leaned bullish despite market-wide sell pressure.
The Open Interest Weighted Funding Rate flipped positive, implying long-position holders were paying funding fees — a setup often associated with expectations of near-term price recovery.
Bullish outlook emerges
Technical indicators suggested that a rebound could be in the works for TAO.
A look at the Money Flow Index (MFI) showed that it entered the bullish zone above 50—an area often followed by strong price momentum.
Source: TradingView
Meanwhile, the Accumulation/Distribution (A/D) line trended upward, reflecting renewed accumulation even as prices cooled.
If these indicators continue their upward slope, TAO could regain momentum toward the $450 zone. However, sustained outflows or another derivatives flush could offset the short-term bullish setup.
