I recently wrote a post explaining why I am not buying TAO. However, that might be the only AI token that brings some value, through Bittensor subnets and the TAO incentive model. Most other AI tokens will fail.

Take ALLO for example, the Allora Network token. I'm shorting it on Aster perpetual dex. You can also trade it (short like me, or long if you think differently) using this referral link: https://www.asterdex.com/en/referral/898200

Let me explain why I am shorting it.

The Allora Network sells itself as a decentralized AI marketplace where machine learning models compete and self-improve. Sounds innovative. But when you look closer, the ALLO token has no real reason to appreciate in value. It's used to pay for inferences, register workers, and distribute rewards. That's a circular economy — tokens go in, tokens go out — and it only works if there's massive external demand coming in from real users paying for real AI outputs. That demand simply isn't there yet, and there's little evidence it's coming anytime soon.

This is the core problem with most AI tokens. The narrative is built on future utility that keeps getting pushed further down the road. Meanwhile, the token is already fully liquid, early investors and insiders are sitting on allocations, and retail is left holding the bag while waiting for adoption that may never materialize at the scale needed to justify the valuation.

ALLO has a max supply of 1 billion tokens and around 220 million in circulation right now. As emissions continue and more tokens unlock, sell pressure will keep mounting. The only thing that absorbs that pressure is genuine protocol revenue — fees paid by consumers using the network. But Allora, like most AI projects, is still largely in a build and hope phase. Hope doesn't offset emissions.

The AI x crypto narrative was one of the hottest of the last cycle. But narratives fade, and what's left behind are tokens with weak fundamentals, shrinking communities, and no sustainable economic flywheel. TAO at least has the subnet model creating real competition and specialization. Most others, including ALLO, are just wrappers around a story.

Be careful out there. Most of these tokens are going to zero, just on a timeline that makes it painful to short and even more painful to hold.