Pi Network, Pi Coin (PI)

What is Pi Coin (PI)?

Pi Coin (PI) is the native crypto coin of the Pi Network, a blockchain project that aims to make mining accessible to any user with a desktop or mobile device and support a digital currency that can be used in everyday transactions.

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As the project initially launched in 2019 and has yet to go fully live, there is much debate and discussion as to whether Pi is a legitimate cryptocurrency or fake.

The name Pi is a reference to the mathematical constant π (pi), which represents the ratio of the circumference of a circle to its diameter. Pi Coin is distributed as a reward to users who participate in the Pi Network’s mining process.

Since the start of several hackathons in early 2023, participants have been developing gaming, decentralized finance (DeFi), and metaverse applications to operate in Pi the ecosystem.

As of August 2023, the project claimed to have 47 million app users, which it calls “Pioneers,” who have been able to complete Know Your Customer (KYC) checks and migrate from the testnet to the mainnet.

An application to use the Pi logo as a registered trademark was filed in January 2023 an, as of mid-December, is under review by the U.S. Patent and Trademark Office.

Who Created Pi Coin?

The coin was created by a team of Stanford graduates with backgrounds in blockchain and social computing, according to the project’s website.

How Does Pi Coin Work?

Early blockchains such as Bitcoin operate on proof-of-work (PoW) protocols to validate transactions and add new blockchains. Miners are rewarded with new coins that are created with each block.

However, Pi Network takes a different approach. The blockchain validates transactions by operating an algorithm based on an early version of the Stellar Consensus Protocol (SCP).

Stellar Consensus Protocol explained

Pi initially launched a mobile mining app, which allows users to operate nodes and form security circles of three to five trusted people. This aims to create a global network while preventing the approval of fraudulent transactions. The developers have since introduced desktop-based Pi Node software to work together.

How Does the Pi App Work?

Once they register, users start mining Pi coins by activating the mining process within the app, which does not require any active participation or complex technical knowledge.

Users log into the Node software through their mobile app accounts, ensuring that both access the same account.

Each user can only have one Pi account and run one node. The user can only initiate Pi mining through the mobile app, while the desktop interface of the node allows the user to check their Pi Coin balance, chat, and view media content on the home screen.

The apps display ads as the users mine coins, generating a revenue stream for the creators.

During the testing phase, Testnet Nodes do not receive mining rewards, as the developers aim to determine the most suitable incentive mechanism based on the data they collect.

During testing, the developers are expanding and refining the Pi Network ecosystem. On 1 August 2023, a new base mining rate came into effect as part of a monthly adjustment based on the rewards issuance formula that was released on 1 March 2022. Miners can increase their individual mining rate through contributions such as Pi lockups, app usage, nodes, security circles, and referrals.

Pi launched its Fireside Forum Web3 social platform in June 2023 and added a decentralized moderation feature in December, which aims to incentivize social content moderation via tokenomics that rewards positive interactions and curbs negative actions.

At the end of November, the Pi Wallet added a new QR code feature for peer-to-peer local commerce transactions. On December 6-11, Pi Network held PiFest, a “Pi Powered Commerce event,” in which users could shop at local Pi-integrated businesses by exchanging Pi Coin.

There were participants in 155 countries and regions and more than 21,000 entries in the local business survey.

Following that event, Pi announced a Pi Commerce Hackathon for the community to create an app to easily locate local businesses that accept Pi Coin, to be held from 1 February to 3 March, 2024, with the winner to be announced on Pi Day, March 14.

Is Pi Mainnet Launched?

The Pi Network platform was initially launched in beta version in 2018, and the testnet was launched in March 2020. The mobile app quickly gained popularity among users aiming to mine coins before the project’s full launch so that they could potentially sell them or use them for purchases when the coin goes live for trading.

The Pi development team promotes the project as an alternative to Bitcoin mining, which is dominated by large mining farms with specialized rigs and is out of the reach of most individuals with standard computer equipment.

However, following several delays, Pi has yet to fully go live, raising concerns that it could be a pyramid scheme or other form of scam. The mainnet launched in December 2021, after which it was enclosed with a firewall to prevent external connectivity.

Pi Network released its Version 1 (V1) Roadmap on 31 October 2023, outlining three main development phases as well as plans to release a V2 Roadmap with future plans. The roadmap notably did not include a timeline for opening the mainnet or a Pi Coin launch date.

According to the announcement:

“The decision not to set a specific timeline for the Open Mainnet is intentional, allowing for a focus on delivering and building a thoroughly vetted and high-quality ecosystem while being attentive to the unpredictable fast-changing external environment, particularly given dependency on a large number of uncontrollable external factors.”

https://x.com/PiCoreTeam/status/1721634873008402676?s=20

In December 2023, the developers updated the network plan with a Version 2 (V2) roadmap stating that the mainnet would be fully opened in 2024 if three conditions are met, but adding that “there is no specific date set”.

The conditions are:

  • Finish any open network preparation work in technology, product, business and legal following the consistent strategies of Pi Network.
  • Meet the following goals for network KYC, migration and utility creation:
    • 15 million Pioneers pass KYC.
    • 10 million Pioneers migrate to the Mainnet.
    • 100 real, distinct Pi apps that are on the mainnet or mainnet-ready, comply with Pi platform policies, solve a true need and bring utility to the ecosystem.
  • The absence of an unfavorable external environment, such as macroeconomic weakness, that would hinder the success of the open network.

While the development team will continue to provide technical and product support, the KYC and migration goals will require the community to bring in more Pioneers. In January 2024 the team reported updates to the KYC process aimed at improving the KYC process and resolving delays. The utility goals rely on community developers to build and launch legitimate Pi apps.

There were around 8 million KYC verified Pioneers, of which 3.9 million had migrated to the mainnet, and around 40 real Pi apps at the time of the announcement.

“We hope the network can achieve them in the year of 2024, with our decentralized efforts and with the absence of unfavorable uncontrollable external factors. If such conditions are not met, then Open Network may be delayed to ensure a more successful transition for all Pioneers,” the announcement stated. “Even if the Core Team and Pioneers were to fulfill two of the conditions, the uncontrollable and unpredictable environmental factors (i.e., the third condition) can still possibly force the network to stay in the Enclosed Network period and continue to build, adjusting to the new global realities.”

Is Pi Coin a Scam?

However, Pi Coin remains unavailable for trading. Some users who have amassed large numbers of coins have engaged in informal peer-to-peer trading, agreeing to transfer tokens when they are able to do so. In December, several cryptocurrency exchanges, including HTX, BitMart, and Biconomy, began listing the price of an unauthorized “Pi IOU.”

Vietnam’s Department of Cybersecurity and High-Tech Crime Prevention Friday has launched an investigation into Pi Network, according to a local report.

How Many Pi Coins Are There?

It is important to note that Pi Coin is not to be confused with the Pi Network DeFi token on Binance’s BNB blockchain.

As the Pi Network remains in the development and testing stage, the supply of coins is undefined. The coins carry no real value, as holders cannot exchange them for cash or other cryptocurrencies.

Like the Bitcoin blockchain, which reduces its mining reward by half every four years, Pi Network has been designed to undergo “halving” on a regular schedule to limit to creation of new coins and create scarcity.

The mining rate was halved from 1.6 Pi to 0.8 Pi per hour when the network reached 100,000 users, dropped to 0.4 Pi at 1 million, and halved again to 0.2 Pi at 10 million users. The block reward will drop to zero when Pi reaches 1 billion users.

Pi Coin Price History

Due to its enclosed mainnet status, Pi Coin is not traded publicly and does not have a traded price history on external exchanges. Pi Coin holders have long used IOUs to give the cryptocurrency an implied value, which some price data websites started listing a Pi Coin price in early 2023 to track the informal market. However, these prices may not be accurate when the coin launches on the open market and trades on exchanges.

In the meantime, Pi Coin’s value is primarily based on community sentiment. Until the mainnet launch occurs, the coin remains in the development phase, and its tradability is limited to within the Pi Network ecosystem.

What is the Future of Pi Coin?

Pi Coin’s creators have indicated that the project roadmap includes multiple phases, and once the mainnet is fully live, the aim is for Pi Coin to be accepted by a variety of merchants so that holders can use it to pay for goods and services. This is in contrast to some crypto coins and tokens, which are primarily created as investment or speculative assets.

As the project remains in the development phase, its future will depend on if and when it makes the full transition to public mainnet and Pi Coin becomes tradable on cryptocurrency exchanges. This would be a significant step in establishing Pi as a legitimate cryptocurrency.

Is Pi Network a Good Investment?

The question of whether Pi Network constitutes a good investment is subject to debate and speculation within the cryptocurrency community. As the Pi Coin cryptocurrency is still in the pre-mainnet phase, it has yet to gain full functionality or tradability on external exchanges. The value and potential return on investment remain uncertain until the project progresses further. If you are interested in investing in the project, you should follow the latest Pi Network news to stay informed of the latest developments.

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Nicole Willing
Technology Journalist

Nicole is a professional journalist with 20 years of experience in writing and editing. Her expertise spans both the tech and financial industries. She has developed expertise in covering commodity, equity, and cryptocurrency markets, as well as the latest trends across the technology sector, from semiconductors to electric vehicles. She holds a degree in Journalism from City University, London. Having embraced the digital nomad lifestyle, she can usually be found on the beach brushing sand out of her keyboard in between snorkeling trips.