What is PI Cryptocurrency & How does it work?

Pi Cryptocurrency

Pi Cryptocurrency aspires to make crypto more accessible to everyone. It features a smartphone application that allows users to earn modest amounts of Pi Cryptocurrency. Many, however, are sceptical about the initiative due to the fact that the token has not yet been published.

As of November 2021, there is no proof that any coins are really mined. While the project may appear to many as a scam, read on for critical information you need to know before making your own decision.

A Brief Overview of this Coin 

The consensus model of Pi Crypto is based on proof-of-work (PoW). Users can download the software and earn tokens directly from their phones. Individuals that use the software can win thousands of Pi tokens. However, as of November 2021, there is no proof that any currencies are being mined.

There are no transactions if there are no tokens in circulation. Users can verify transactions and earn incentives for doing so through PoW systems. Without transactions, there are no incentives. The app generates cash through ads and a referral system. This process calls into doubt the project’s aims.

While the coin is unlikely to be deployed anytime soon, the developers have written a lengthy whitepaper explaining the project’s prospective uses. One of these is Pi cryptocurrency Stack, a service that enables software developers to build applications on the chain. These applications would benefit from the attention of the app’s more than 25 million users.

Additionally, it is experimenting with capabilities related to decentralised finance (DeFi), including a cryptocurrency wallet and a browser. These projects are presently undergoing testing, but they may be released in the future.

The History of the Pi Coin

What is pi cryptocurrency? Three Stanford students, Vince McPhilip along with Chengdiao Fan, and N.Kokkalis, established Pi Cryptocurrency. On 14th March, 2019 the mobile application was launched and the Pi cryptocurrency worth was determined. The project was immediately monetized by ads, and the Pi cryptocurrency worth became over 3.5 million USD in less than a year.

The developers have since implemented a halving scheme. Numerous proof-of-work blockchains, including Bitcoin Pie, employ this mechanism to regulate the coin’s supply. It effectively cuts in half the amount of Bitcoin Pie awarded as prizes for hitting certain milestones. You might be thinking “Is pi cryptocurrency legit?

Of course, it is very much legal and as of November, 0.2 Pi per hour can be mined. The team organized a Hackathon in September with the first prize going to a business application built on the network and the 1st prize of USD 20000 to encourage the creation of new projects on the chain.

Is this Coin Beneficial?

The Pi Network announced on 25 November that it had reached 29 million users With an average of 61,120 Pioneers joining the network each day.

The project intends to launch its own blockchain with features such as a Pi crypto browser and Pi cryptocurrency wallet. If these are delivered, they will significantly improve the network’s general usability. However, no release date has been specified for these projects. They have been in testing for about a year, and the developers have provided very less information about their status.

The Pi Coin Blockchain in Comparison to Other Blockchains

Do you know how does Pi cryptocurrency work? Pi crypto intends to use a proof-of-work (PoW) technology that will enable users to mine currencies from their smartphones. Pi crypto employs this structure, though users give far more computational power in exchange for a share of the network’s transaction fees. The exchange rate of this Network is USD 1,9895 as of December 1.

  • The blockchain is intended to be self-contained and run autonomously via in-chain applications. This system would be similar to Ethereum and Solana in that developers may create apps to do activities on the blockchains. However, Ethereum and Solana both have operational blockchains to which developers may implement applications, whereas Pi Cryptocurrency’s blockchain is still in development.
  • We do not see anyone but the creators benefiting significantly from this Network, as users are currently investing in the service without receiving tangible (except perhaps psychological) benefits.
  • Apart from basic capabilities such as in-app chatting, the software provides no value to its customers. The majority of users keep it in the anticipation of one day converting their virtual coins to real money.
  • The software functions similarly to a direct selling or affiliate marketing scheme, offering users future compensation for referring new users. Multi Level Marketing is compared to it because it incorporates direct selling and offers enhanced potential benefits to early users (i.e. earlier users mine at a higher rate), however affiliate or direct selling may be more appropriate parallels.
  • Users invest in the app. Hundreds of blogs on the internet assert that this Network cannot be a scam because consumers do not invest any money. These consumers value their time and data, which they spend on the app. For more information, see the review of the app’s privacy statement, data gathering practises, permissions, and third-party software integration.
  • We believe it is improbable that the programme will continue to generate Pi cryptocurrency value in the future, despite its claims.
  • The application generates a finite amount of Pi cryptocurrency value. Users add little value unless when they provide information to the mobile app, view ads, or communicate with other users. These activities are unlikely to generate a considerable amount of wealth for the big user population.
  • Several of the organization’s current techniques are also employed in scams.
  • The app has already benefited the founders. They initially introduced optional video ads in order to monetise the active user base. Additionally, the Pi cryptocurrency app has a Know Your Customer (KYC) process for gathering passport information.

How does the Network operate?

It’s a daily login app where users click a button to receive digital cash. There is no documentation of work accomplished; they simply logon and click a button. Because this money is not yet exchanged, it has no value at the moment.

Increase your level by inviting additional members to the platform. This results in them accumulating more digital cash each day. This is a model that is frequently used in Pyramid Schemes and multi-level marketing.

Could the currency of these Networks become valuable in the future? 

Naturally, an evidence-based study in this section is conducted, and there is also evidence that Pi cryptocurrency Networks is working to build something of value:

They’ve released a high-level whitepaper explaining their goals without going into technical depth on how their Pi cryptocurrency Stack will work. One of their goals is to encourage others to build apps on the PI cryptocurrency network in order to gain from the attention of Pi cryptocurrency network users.

They are striving to cultivate a developer ecosystem that will enable them to produce apps that provide value to their platform. Given the importance of developer time and the Pi cryptocurrency Network’s current test phase, it will be difficult for them to obtain compelling third-party applications created on the platform.

They are obviously attempting it, however, by hosting a hackathon and publishing a Software Development Kit (SDK) that enables third-party programmes to conduct Pi crypto transactions. Among the hackathon’s winners are an e-commerce store and a marketplace that connects freelancers with projects. Once the mainnet is deployed, these apps will begin to produce revenue.

According to Pi cryptocurrency users, the Pi team’s approach of forking the open source Stellar blockchain in order to construct their implementation needs tremendous effort for a variety of reasons, which explains the delay.

Will Mining on this Network Come to an End?

As is the case with many new cryptocurrencies, Pi is currently mineable; but, there is a limited window of opportunity to join, and mining for new members may cease once the user base hits 10 million Pioneers.

Existing users will, of course, be allowed to mine, but at a reduced pace, potentially half of what they were when they started.

November update: The Pi Testnet presently has around 12000 active nodes, making it one of the world’s largest peer-to-peer networks. This also indicates that we’ve progressed one step closer to a more decentralised Mainnet.

What are the pivotal points of this cryptocurrency network?

  1. Bear in mind that this Network is completely FREE to join and that you will profit even if you mine only ten cents!
  2. Utilizes your mobile device and does not deplete your battery.
  3. Digital money that is secure, uncounterfeitable, and interoperable.
  4. The Pi cryptocurrency App is available for download on Google Play and the Apple App Store.
  5. The Raspberry Node provides Remote Access to the Application via your computer.
  6. The network has scalable security without the electrical waste.

Is this Network worth it? 

Unlikely, the question is why they haven’t launched it and exchange already. These are child’s play in terms of technical tasks. One of the reasons may be that they are waiting for their user base to grow large enough to generate revenue from ads.

However, huge advertisers will display ads in a network where users log in to earn money by viewing ads. This is not a novel notion. Such websites have existed since the inception of the internet.

None of them, however, achieved widespread adoption. This is because marketers find it more lucrative to advertise on frequently visited websites that provide some value to visitors (e.g. information, connecting with friends etc.).

The skepticism around the objective of the founders and the legitimacy of the project remains under speculation with the market being split between some considering this as an outright scam and some hopeful optimists who support this project.

At Solutiontales we make it easy to understand the throes of cryptocurrencies, but our words should not be taken as a financial advice. Remember, a wise investor can make money in a bull or bear market when given the right data.