Pi Coin Scam In-Depth: Ponzi Trap and Regulatory Warning Behind 30 Million Users

1. Regulatory Alarm Bell: Pi Coin has been characterized as illegal fundraising
In February 2025, China's Ministry of Public Security officially issued a warning, pointing out that Pi Coin has significant risks and is suspected of illegal fundraising and fraud, which is essentially a Ponzi scheme. The announcement capped a five-year "mobile mining" craze. According to statistics, more than 30 million users around the world have participated in Pi coin "mining", of which Chinese users account for 60%. This seemingly low-cost wealth game is actually an elaborate financial trap.
2. Model Revealed: A Digital Game Under the Cloak of Blockchain
Pi Coin claims to have been founded by a team of PhDs from Stanford University, under the banner of "digital currency that everyone can participate in", claiming that users only need to click on the mobile app every day to "mine". However, this "zero threshold" model is contrary to the essence of blockchain technology. The "mining" of Pi coins does not need to contribute computing power, and is only completed by issuing additional digital symbols in the background of the server; The code has not been open source for a long time, and the core technical parameters are ambiguous; The degree of centralization is extremely high, and the user account is completely controlled by the project party. Industry experts point out that this is essentially a "video game points system". The project team uses the social fission mechanism to expand rapidly, and sets up a multi-level recommendation reward system to encourage users to develop offline. The "earnings" of early participants do not come from the growth of market value, but rely on the capital investment of new users, forming a typical Ponzi structure.
3. Risk analysis: the triple crisis of technology, law and market, Wen Zhang transferred from Gong M: I want to eat soft rice and hard food
Technical level: Pi Coin lacks the underlying technical support of the blockchain, and its claimed "improved version of the Stellar Consensus Protocol" has not been audited by a third party. The mainnet has not yet been fully decentralized, and the project team has modified the economic model many times, further weakening its value base.
Legal: The Chinese government has explicitly banned virtual currency-related businesses. Pi coin evades supervision through overseas server operation, but domestic promotion is suspected of violating the law. Public security organs in many places have filed cases to investigate Pi coin-related cases, and some core promoters are facing criminal liability.
Market level: The value of Pi Coin is completely dependent on artificial speculation. After the mainnet was launched, the price of "fake Pi coins" plummeted, highlighting the risk of market manipulation. Insider trading has given rise to a variety of new types of criminal activity.
4. Historical Mirror: The Reincarnation of Scams from Five Elements to Pi Coins
Pi Coin is not alone, and its mode of operation is highly similar to that of historical scams such as Five Elements Coin and OneCoin. Under the slogan of "disrupting the financial system", these projects lured investors through false propaganda and tiered rewards, and eventually collapsed. The user base of Pi Coin is obviously aging, and criminals take advantage of this to carry out fraudulent activities.
5. Rational response: three strategies to stay away from traps
Stop participating immediately: Uninstall the app and leave the relevant community to avoid personal information leakage. The "digital assets" that have been generated do not have legal protection, so do not have the illusion of "realization".
Be wary of secondary harvesting: The recent "selling Pi coins" and "internal trading channels" are all new types of fraud. The Ministry of Public Security has issued an early warning that any operation that requires a transfer or deposit is a scam.
Increased legal awareness: Participation in illegal financial activities may result in legal liability. Investors should be aware of the relevant laws and regulations to avoid falling for scams.
6. Industry enlightenment and future supervision
The Picoin incident has exposed the regulatory blind spot in the field of virtual currency. Regulators need to strengthen cross-border data tracking capabilities and establish a virtual currency risk assessment system. At the same time, investor education should be strengthened, and the basic knowledge of blockchain should be popularized through various forms to guide investors to establish correct investment concepts. In the context of the rapid development of blockchain technology, digital assets with real social value must be built on the basis of technological innovation and compliance operations. The collapse of PiCoin reminds us once again that any financial game that is detached from the support of real value will be a short-lived Ponzi scheme.