Pi Network has attracted attention as a platform that allows users to easily mine cryptocurrency using their smartphones. However, what about its safety and risks? This article provides a detailed explanation of Pi Network’s reliability based on the latest information and summarizes the points that investors and users should be aware of.
How reliable is Pi Network?
To assess the reliability of Pi Network, the following factors need to be considered:
- Project Background and Development Team
- Project Transparency
- Security Measures
Project Background and Development Team
Pi Network is a project launched in 2019 by Stanford University graduates, and the development team has educational backgrounds and expertise. This suggests a certain level of reliability is guaranteed.
The head of the development team is Nicolas Kokkalis, who holds a Ph.D. in Computer Science from Stanford University. He actively shares information about Pi Network’s vision and technical mechanisms on the official website and social media.
Project Transparency
Pi Network regularly publishes development progress and plans on its official website and social media. This ensures project transparency and enhances reliability.
For example, on March 14, 2022, they announced that the number of Pi Network users had reached 33 million and that preparations for trading on exchanges were underway. Also, on May 17, 2022, they reported that the KYC (Know Your Customer) process was now available in Japanese and that the launch of the Pi wallet testnet was approaching.
Security Measures
Pi Network implements security measures such as two-factor authentication and password strengthening to protect account safety. User data is also stored encrypted, preventing unauthorized access by third parties.
The Pi Network mining application links with the user’s mobile phone number or Facebook account and functions as a cryptocurrency wallet. In this process, user personal information is not sent to the Pi Network server but is stored only on the device. Furthermore, Pi Network does not use a PoW (Proof of Work) protocol like Bitcoin but utilizes an algorithm based on SCP (Stellar Consensus Protocol). This allows for low-cost mining without consuming smartphone battery or data usage.
How risky is Pi Network?
On the other hand, Pi Network has several risk factors. The main ones are listed below:
- Trading on exchanges has not yet started, and the value of Pi tokens is not yet determined.
- Future success is not guaranteed due to regulatory trends from authorities and competition with other projects.
- Service suspension or delays may occur due to project operation or technical issues.
Trading on exchanges has not yet started, and the value of Pi tokens is not yet determined
Pi Network listed its own cryptocurrency “Pi” on the FUBT exchange on March 14, 2022, but subsequently faced the situation where the FUBT exchange was closed. This caused the price of Pi tokens to plummet, and they are currently untradable on exchanges.
The Pi Network development team has announced that they are preparing for trading to start on other exchanges, but the specific timing or exchange names have not been disclosed. Therefore, the value of Pi tokens remains uncertain, and investors and users are exposed to the risk of price fluctuations.
Future success is not guaranteed due to regulatory trends from authorities and competition with other projects
Pi Network has gained tens of millions of users worldwide, but on the other hand, there is also the risk that future success is not guaranteed due to regulatory trends from authorities and competition with other projects.
For example, Vietnam’s Cybersecurity and High-Tech Crime Prevention Department initiated an investigation into Pi Network in July 2022, expressing concern that its model was “very complex and recently unmanaged.” Also, Nigeria’s Central Bank announced a policy banning cryptocurrency trading in February 2022, which affected Pi Network users.
Furthermore, Pi Network has the characteristic of allowing cryptocurrency mining on smartphones, but there are other projects with similar concepts. For example, Electroneum and Phoneum could potentially compete with Pi Network.
Service suspension or delays may occur due to project operation or technical issues
Pi Network may experience service suspension or delays due to project operation or technical issues. This is a risk common to cryptocurrency projects, not limited to Pi Network. These issues could potentially reduce the quality and stability of Pi Network’s services.
For example, in June 2022, a bug occurred in the Pi Network application, preventing some users from mining. Also, in August 2022, the Pi Network website was temporarily down, making it inaccessible to users.
Summary: Balance of Reliability and Risk
Based on the development team’s background, project transparency, and security measures, Pi Network can be considered to have a certain level of reliability. However, risk factors such as the start of trading on exchanges and regulatory trends also exist. Investors and users need to assess the reliability and risks of Pi Network before participating. Pi Network is an innovative platform that allows cryptocurrency mining on smartphones, but it is still a developing project with many unknown elements. Remember this. You can check the latest information and news about Pi Network on the official website and social media.