Pi Network Listed But Users Find It Hard to 'Change Lives'

Only a few people mining Pi can bring the coin to the market for trading. The amount earned from the project on accounts exceeding 1,000 USD is also very modest. With the current trading price, the expectation of getting rich overnight for miners is difficult to realize. In addition, the Pi Network development team controls the amount of digital currency in circulation. This makes it difficult for many people to sell their Pi, causing Pi coin to gradually disappear. Only 0.6% of accounts earn over 1,440 USD After 6 years of launch, Pi Network announced that they have 60 million users globally. Among them, about 10 million are participating in the mainnet. This is the number that can bring Pi mined into the network, sold for profit. However, statistics on ExplorerPi show that 96% of wallets have less than 1,000 coins. The largest 360,000 accounts of the new project own more than this threshold. Out of 60 million users, they only account for 0.6%. However, the profits earned by these Pi ‘whales’ are not too large. With a price of 1.44 USD/Pi on February 23, the ‘Pi miners’ mentioned above earn at least about 1,440 USD (36 million dong). This figure is only equivalent to the airdrop rewards of many blockchain projects.

Meanwhile, 99.4% of the remaining accounts have less than 1,000 Pi or are not yet KYC’d, bringing the check-in number on the app to the blockchain. Before going online, many people in group communities in Vietnam expected Pi to be worth thousands of USD, equivalent to Bitcoin or exchanged for cars, villas. However, with the amount of digital money they mined on their phones, along with the current transaction price, the dream of changing their lives with Pi is difficult to come true. In terms of technology, Pi Network operates on the Stellar blockchain. Stellar’s XLM token currently has a fully diluted market capitalization of approximately 17 billion USD. In contrast, Pi Network, which was launched later and is still relatively poor in terms of applications, is valued at 144 billion USD. Therefore, researchers predict that the cryptocurrency may experience a sharp decline in real value equivalent to Stellar after the FOMO wave. Team controls the supply To prevent dilution of the digital currency supply, project developers use various methods to control the supply and avoid early participants from mining too much. First, to participate in the blockchain network, users need to KYC (verify their identities) first. However, the development team restricts the number of verified accounts. Therefore, the Pi of many people is only displayed on the app, without the right to buy, sell, or exchange.

Once KYC is completed, not all digital assets may be tradable. Miners divide assets into two types, Purple Pi and Gold Pi. Purple is only earned by users through daily check-ins and can be pushed onto the blockchain. Meanwhile, the gold portion from the members who have entered the referral code or belong to the mining circle. Only when these people KYC, the mentioned Pi amount will turn purple. In most cases, this portion will be lost on its own as many people have abandoned their accounts. Previously, the team behind the project also introduced the Pi lock feature onto the blockchain to increase mining speed. According to ExplorerPi’s report, nearly 98% of the total mined coins have been ‘frozen’ for 6 months to 3 years, unable to be traded.

In this way, the Pi Network team limits the amount of digital currency pushed onto the market when the network opens. According to the announcement, there are currently only 6.4 billion Pi coins in circulation, including the portion frozen by users. This is a very small part of the total supply of 100 billion for the project. In addition, according to the tokenomic (allocation mechanism of Pi Network, only 20% of the coins are allocated to the early joiners. They allocate up to 45% for mining after the network is opened. As the circulation of Pi increases, the total supply is diluted, which may cause a significant price drop. Therefore, the expectation is that the digital currency will increase in value in the future due to scarcity being difficult to achieve.