I would like to introduce you to an interesting project called Pi Network.
At the end of the article, I have included a link to an article that does a thorough due diligence (researching the value and risk of the investment) on Pi Network. Hope this helps you understand the project.
You can rest assured that I will not solicit you for personal gain or encourage you to buy.
What’s the Pi Network?
Pi Network is a blockchain network developed by SocialChain Inc.
Anyone can mine the Pi crypto currency from day one, free of charge, by installing an app for their smartphone. Among the many types of mining apps that have been released, Pi Network is the oldest.
The app serves as a mining device as well as a wallet for storing Pi.
According to the official announcement on May 20, 2022, the number of app users worldwide reached 35 million.
A market has formed on the Pi Network, with a variety of projects under development in each.
Examples include decentralized social networking sites, marketplaces, NFT platforms, e-book selling apps, skill markets, flea market apps, and sites for sharing food knowledge. It really feels like a lot of different things are available.
Thus, many of the projects developed in the Pi Network are not only businesses that can be completed only on the Internet, but also utility-based businesses that are tied to the real economy. One attraction is that participation in the network is free, and anyone can start a business by creating an application.
Once you install the Pi application, you will be able to use an original web browser called Pi Browser, where you can search and browse information on each project. Among the many projects, the projects of hackathon participants are particularly promising.
Pi is the reserve currency used in the market built on the Pi Network, as described above.
Technology behind Pi Network
Bitcoin mining requires so much power that environmental issues have been mentioned. Therefore, some people may not have a good impression of mining, which is essential for the PoW (Proof of Work) mechanism. However, the amount of power consumed varies from blockchain to blockchain.
Pi Network uses the Stellar Consensus Protocol for power-saving mining. This is the same Stellar that is listed on crypto currency exchanges in Japan, Stellar Lumens. I actually mined with the application, but I did not feel that the battery runs down quickly, nor did I experience any phenomenon that made my phone run slower.
Pi Network’s distributed ledger is public and permissionless.
Because it is a public ledger, anyone can create and run an app without a license, and because it is permissionless, anyone can set up a node. This wide frontage may be the reason why the network is maintained by a large number of nodes and the number of app developers continues to grow.
For your reference, I have placed a table with four categories of distributed ledgers and examples of blockchains that fall into each category.
|Private||Hyperledger Fabric、Enterprise Ethereum…||Holochain、LTO Network…|
Mining is performed once every 24 hours by simply opening the application and pressing a button. Mining will continue even if the Pi Network application is not running while mining is in progress.
Pi Network’s Tokenomics
All three images above are from the December 2021 white paper.
The text states in bold that the maximum supply is 100 billion Pi.
The pie chart shows the token percentages for the core team and the community. The core team is allocated 20% (20 billion Pi) and the community 80% (80 billion Pi).
The table provides a breakdown of the 80 billion Pi of tokens allocated to the community. 65 billion Pi is allocated to mining rewards, 5 billion Pi to the liquidity pool, and 10 billion Pi to the foundation.
The liquidity pool is used to ensure liquidity for miners, app developers, etc. and to maintain a healthy ecosystem. The Foundation’s allocation is an asset for the Foundation to maintain and manage the Pi Network, similar to Ethereum and Stellar.
The mining rate continues to decrease as the number of participants increases and reaches zero when there are no more Pi available for mining. Participants can increase their individual mining rates by contributing to the network as follows
- Invite others to Pi Network mining
- Build a security circle (up to 5 people)
- Set lockup or increase current lockup amount/extend duration
- Receive app developer rewards *Pi Network app developers only
- Perform KYC of others as validators after passing own KYC
For more information on Tokenomics, please refer to the white paper and other official announcements.
Points of Attention: You will not be rewarded by the invitees of the invitees. In other words, only the number of direct invitees will affect the mining rate based on the number of invitees. In addition, if a user fails to pass KYC, the Pi held by that user and the Pi of other users obtained by the presence of that user will be Burned (disappear).
Future of Pi Network
Real economy-based participatory network
My attraction to Pi Network’s future is threefold.
- Many businesses are tied to the real economy, not just those that are completed solely on the Internet.
- Anyone can participate in mining, app development, node execution, etc.
- The network is maintained and managed by impartial governance.
(1) and (2) have been described so far. What surprised me personally in (3) was that instead of simply deciding things by majority vote on the web, there are cases where users gather locally in each region and settle things in face to face meetings. Other blockchain projects may also use such a method, but I remember thinking that it is a method that is very compatible with the Pi Network, which has strong ties to the real world.
Absence of Pi Network competitors
Pi Network has no competitors.
While there are many types of mining applications, most of the utility tokens used in these applications are specific to a particular domain, such as online banking or gaming, for example. Pi Network is quite unique in that it is an enterprise business for a variety of occupations that are associated with the real economy.
The size of the market is outstanding compared to other companies, partly because I offer services to a wide range of targets.
On June 28, 2022, the main net of the Pi Network was opened and trading with Pi began. Some people purchased pizza with Pi, as the first item purchased with bitcoin was pizza.
The Pi Network project is underway with plans to list on a crypto currency exchange in the future. Although the main network has just been opened and is now limited to trading in a closed environment within the Network, sooner or later it will be linked to the real economy and will develop services in the future that will not be similar to others.
Stellar’s track record is a precedent for Pi Network
I have already reported that Pi Network uses the Stellar Consensus Protocol (SCP).
Stellar is a global provider of payment services, stable coin issuance, and financial asset tokenization, and plays a particularly important role in the area of CBDC, including the development of CBDC: e-hryvnia in the Ukraine and participation in the CBDC: Digital Real development project in Brazil, together with Mercado Bitcoin. SCP’s track record of successful implementation is an encouraging boost to the Pi Network, which uses it.
Here is the news here, from Yahoo! finance on April 29, 2022. “Panama is poised to approve the use of Bitcoin and 8 other cryptos ‘without limitation’”
In Panama, a major artery of global trade that approved a bill regulating crypto currencies as if in step with the WEF/WTO, the crypto currency stocks approved for use were only 9 kinds, as noted in the article, Bitcoin, Ethereum, Algorand, Elrond, IOTA, Litecoin, Stellar, and XRP, and XDC. There is a lineup of stocks closely associated with ISO 20022 there.
These crypto currencies will be part of the $2.6 billion annual toll payment for the Panama Canal. Roughly 13,000 vessels navigate the canal annually. The crypto currencies passed by the bill are now part of Panama’s infrastructure.
The fact that Stellar has been chosen as the first to be part of this regulated crypto currency payment model is very important, as it is the first to be compliant with the regulations of each country. It is also a guarantee that Stellar will be able to adapt and survive the economic changes that will occur globally in the future.
The world’s payment institutions are steadily moving toward SWIFT’s planned full ISO 20022 migration. Payment systems such as Fedwire, Clearstream, Euroclear, Target2, and Target2-Securities will all operate under the ISO 20022 standard, and it is important for Pi Network that Stellar is deeply involved in this vortex. The consensus issues that arose and how they were resolved will no doubt be used by Pi Network in the future.
This was an introduction to Pi Network.
If you are interested, I encourage you to start mining Pi. You will discover the novelty of it by actually trying it out, and the more you learn about it, the more interesting it really is.
The app is by invitation only, so if you like, you can use my invitation code “TradeFennex”. And, if you want to know more about Pi Network, you may also want to read the following article, “[In-depth Investigation] Is Pi Network a Scam?” to learn more about Pi Network. This is a risk-focused due diligence report that thoroughly investigates Pi Network and its developer, SocialChain Inc. to bring the whole Pi Network picture to light.
Thank you very much for coming to visit me~.