Pi Network (CRYPTO: PI), a viral cryptocurrency project that attracted over 60 million users known as ‘Pioneers,’ saw its price crash to a record low during the ongoing crypto winter. It slipped to a record low of $0.1232, down by 96% from its all-time high of $3.
This painful crash has led to a substantial decline in its market capitalization, moving from $20 billion to $1.3 billion today.
The Rise and Fall of Pi Network
Pi Network is a popular crypto project that was inspired by Bitcoin (CRYPTO: BTC). Chengdiao Fan and Nikolas Kokkalis, the founders, believed that they could solve Bitcoin's main challenges, including the high transaction costs and the need for expensive mining hardware.
They launched Pi Network on 3rd March 2019, a date that coincided with Pi Day, day that commemorates the mathematical constant that represents the ratio of a circle's circumference to its diameter.
Pi became an instant hit, with over 60 million users participating in its mining and cashing out once the coin was listed. This process became possible in February last year when it launched its mainnet launch.
Since then, the coin has been in a strong downward trend with occasional rebounds. It has crashed and erased at least $18 billion in value.
Why Pi Coin Price Crashed
There are a few reasons why this happened. First, Pi Coin lost most of its fanbase due to its prolonged stay in its enclosed mainnet. It stayed in this stage between 2021 and February last year. This meant that pioneers were not able to cash out their tokens.
Second, many major crypto exchanges avoided listing it, with the head of Bybit calling it a scam. Binance, whose users voted overwhelmingly to list it after its mainnet launch has not yet listed it. The same is true with other popular exchanges like Upbit and Coinbase. Its recent Kraken listing has not driven substantial demand.
Third, there have been concerns about its tokenomics. Data shows that there are now a circulating supply of 10.6 billion tokens against a maximum supply of 100 billion tokens. As a result, the network unlocks millions of tokens a month, adding to its existing supply.
The substantial token unlocks, coupled with the weak demand has contributed to the coin's weak performance over time. In line with this, there are concerns about the network's centralization as the obscure Pi Foundation holds billions of tokens in hundreds of wallets.
Additionally, its ecosystem has not worked out as the team has suggested. It has always been described to as a ghost chain because of its waning activity.
Pi Developers are Pivoting to AI and Ecosystem Growth
The team is now working to solve the key issues facing the project. For example, they have launched a major network upgrade to align itself with the Stellar Consensus Protocol 26. This upgrade will introduce smart contracts to the network, making it easier for people to build decentralized applications.
They have also made two major investments: CiDi Games and OpenMind. CiDi Games has already launched several games on its platforms that users have played millions of times. It is collaborating with OpenMind to ensure that its its miners can participate in its AI process and make money.
The team is also pivoting to the AI industry by launching a human verification project similar to Worldcoin (CRYPTO: WLD). Its goal is to leverage the success of its KYC process that has verified over 18 million users and offering the service to companies.
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