Is Pi Network Legit

The legitimacy of the Pi Network and its token has been a long-standing debate. During the launch in 2019, it had attracted millions of users all around the world. The promise of this network was as simple as its interface – mine the Pi coin on your smartphone for zero cost.

People flocked in, hoping it was yet another opportunity like Bitcoin. When Bitcoin first came out in 2009, nobody paid any attention, and people regret it to this day. So it was worth risking to install an app on your phone if one day Pi was going to be a major coin.

As time passed, the Pi network had a whole different story; it was soon deemed the biggest soft scam in history.

Tapping Into The Psychological Capital

The most powerful tool Pi Network leveraged was the psychology of the crowd. The illusion of getting something that is going to raise its value in the future was an attractive proposition to many people.

Users had one simple job to do: sign in daily and press a mine button that would automatically be reset in a 24-hour timeframe. For such a simple task, a free reward of cryptocurrency seemed alluring to users. The underlying sentiment was that the cryptocurrency would someday appreciate in value.

However, what really happened was that users were mining a virtual token that had no real-world value. It was nothing more than a marketing scam that would soon unravel itself as a pyramid scheme.

Pi Network As A Pyramid Scheme

To increase the mining speed, users were urged to act as promoters. Soon enough, a referral model was in place, which rewarded you with “higher mining power”. Based on the number of people someone invited, they would get more tokens than usual in the 24 hours, given that the invitees were mining as well.

This made the project spread faster and farther. People all around the world hungered to have the largest number of people referred to them. This was nothing but a program focused primarily on expansion rather than increasing any real value.

The Closed Mainnet Lacked Transparency

Even with millions of users logging in daily, the developers never listed the coin on any major exchange. This was when doubts slowly started to rise about the legitimacy of the Pi Network and its coin.

There were demo stores, which were nothing more than closed mainnets. This meant that users could not withdraw their coins to another wallet. There were no details regarding the blockchain, and the project lacked overall transparency.

Apart from the lack of a transparent detail about the blockchain and the network’s underpinnings, there were no details regarding the launch as well. There was no timeline or clear picture as to what the project was and how its future was going to be.

Pi Network App Could Have Abused User Permissions

Behind the scenes, the network could siphon valuable data and was posing a threat to the privacy of all those who had installed the app. For a simple app with limited functionalities, the Pi Network required an awful lot of permissions and data access.

It asked for access to contacts, location, usage tracking, and more. The reason for suspecting problems was not that it asked for permissions, but because it never gave clear explanations of what the data accumulated thus will be used for.

If this data undergoes any misuse, it puts millions of users at risk. So it was never free; the mining and the visual impact were all gimmicks put in place to steal valuable user data. And those who knew the dangers still thought the coin would reimburse them for the data thus acquired, but it has not happened to date.

The Risk of a Pump And Dump Scheme

The founding team holds a large percentage of the total token availability. This comes around at 20 to 25% of the total supply. This means that even if this token was listed on an exchange, they could rapidly sell the asset to ordinary buyers who were waiting for an opportunity and escape the scene.

But for the ordinary users and millions of followers, the price drop caused by the supply inflation would be a catastrophic result. The result would be millions of users left stranded on exchanges with a coin worth no value.

Final Thoughts

Pi Network could never prove its actual worth. They relied on psychological manipulation to score millions of users’ worth of data. Additionally, the pump and dump chances are still offering the developers the upper hand if the coin were to be released on an exchange ever.

In short, the Pi Network wasted the time and efforts of millions of individuals. This may not look like a huge issue from an individual perspective; however, such a digital wealth dump in return for nothing of real value exposes the truth about how psychological manipulation can work as an effective tool in scams.