Pi Network: What Is It and How Does It Work?

Pi Network aims to provide users with a new crypto called PI, which its creators promise to offer all the advantages of bitcoin (BTC) while avoiding its pitfalls.

Pi Network, founded in 2018, aims to introduce a new cryptocurrency called PI with the promise of offering all the advantages of bitcoin (BTC) while avoiding its pitfalls. However, as of November 2024, more than five years after its initial launch, Pi Network is still unreleased. It cannot be sold on any exchange and does not yet exist on a live blockchain. To mine Pi, users simply sign into the Pi app from their phones and tap a button once every 24 hours.

In this article, we will delve deeper into the PI cryptocurrency and the inner workings of the Pi Network.

Pi Network explained

Pi Network was founded by Stanford University academics Nicolas Kokkalis and Chengdiao Fan in 2018. On 14 March 2019, they published a whitepaper and unveiled the Pi Network app.

The app is used to mine PI, with users pressing a button every 24 hours. To join the app, users obtain an invitation code from a member. The platform employs a referral system, whereby users earn additional Pi based on the number of new users they sign up.

Pi Network differs from many other cryptocurrencies in that it employs a proprietary mechanism, derived from the Stellar Consensus Protocol (SCP), which enables users to receive benefits for their participation in the network.

Who uses Pi Network?

There are four types of users on the Pi Network. These are:

Miners: Anyone with a mobile phone and internet connection can join the Pi Network and begin mining Pi. There are no hardware or electricity costs associated with Pi mining. As a decentralised network, Pi Network does not have a central mining pool. Instead, each user's device contributes to the network's overall mining capacity.

Ambassadors: Ambassadors are members of the Pi community who actively promote Pi Network and its cryptocurrency. They share information about the project on social media, invite new users to join the network and contribute to the community in various ways. Ambassadors earn additional Pi for their efforts in promoting the project.

Nodes: Nodes are computers that maintain a copy of the Pi Network blockchain and participate in the network's consensus mechanism. Running a node requires technical expertise and involves maintaining a stable internet connection and hardware specifications. In return for operating a node, users are rewarded with Pi.

Pioneers: Pioneers are members of the Pi Network community who have completed their identity verification and are actively engaged in the network's activities. They receive benefits for their contributions, such as increased mining rewards and priority access to new features and applications.

Mining rate and growth

When the Pi Network initially launched, the mining rate was set at 1.6 Pi per hour. Over time, as the network's user base expanded, the mining rewards were systematically halved:

At launch: 1.6 Pi per hour (1 Pi = 3.14159265 seconds)

After 100,000 users: 0.8 Pi per hour

After 200,000 users: 0.4 Pi per hour

After 400,000 users: 0.2 Pi per hour

After 800,000 users: 0.1 Pi per hour

After 1.6 million users: 0.05 Pi per hour

After 3.2 million users: 0.025 Pi per hour

After 6.4 million users: 0.0125 Pi per hour

After 12.8 million users: 0.00625 Pi per hour

The mining rewards are expected to continue declining as the network grows, incentivising early participation. The team has set a goal of achieving one billion users, at which point the mining phase may conclude.

What is the value of Pi?

The value of Pi is currently undetermined. It’s an unlisted token that is practically worthless as of November 2024. As a result, there’s no historical data on the Pi Network’s performance since the token has not yet been launched on any cryptocurrency exchange.

Pi Network’s creators have yet to reveal the number of coins in circulation once the project is formally launched, however, the original whitepaper says that the total Pi supply will be 100 billion.

Pi Network’s milestones in its first four years

In September 2022, the Pi Network announced the launch of PiConnect. PiConnect aims to allow Pi Network users to make interoperable trades with other blockchain networks like Binance Smart Chain (BSC), Ethereum (ETH), Polygon (MATIC) and others quickly, affordably and securely.

In addition to bridging with Blockchain, PiConnect aims to provide farming and staking, a launchpad platform, lending, auctions and a marketplace, among other things.

Launch of Pi Bridge

In September 2022, the Pi Network