Is Pi Coin Legit or a Scam? Key Facts to Know in 2024

Pi Coin (PI) is the crypto mining project with hopes of being a worldwide payment system and a staggering 35 million supporters behind it — but is Pi Coin legitimate, and will its lofty dreams ever come to pass?

At its core, Pi Network aims to allow users to mine Pi coins with minimal effort. Unlike energy-intensive cryptocurrencies like Bitcoin, Pi mining requires no powerful hardware — users simply tap a “Lightning” button in the Pi Network app once every few hours to earn coins.

This ease of use has contributed to the project’s growth, attracting a (self-reported) 35 million users, of which 12 million people ‘Pioners’ have completed their identity verification through Pi’s native Know Your Customer (KYC) solution.

Other metrics show Pi Coin’s success: on X (formerly Twitter), the official Pi Network account has 3.4 million followers on X as of November 2024 (neck-and-neck with the official Ethereum Foundation account).

While all these achievements point to a promising venture, the delay in Pi Network’s open mainnet launch and doubts around both the number of active wallets, reliance on an advertising model, and the utility of mining have raised concerns among users.

In this article, we explore whether the Pi crypto is legit or a scam.

Table of Contents Table of Contents

1. Pi Coin Key Facts
2. Pi Network's Open Mainnet: Progress or Promise?
3. Pi Network & The Ad Revenue Model
4. Is Pi Network Safe or Selling Your Data?
5. Could a Full Launch Lead to Success?
6. The Bottom Line
7. FAQs
8. References

Show Full Guide

Table of Contents

1. Pi Coin Key Facts
2. Pi Network's Open Mainnet: Progress or Promise?
3. Pi Network & The Ad Revenue Model
Show Full Guide
4. Is Pi Network Safe or Selling Your Data?
5. Could a Full Launch Lead to Success?
6. The Bottom Line
7. FAQs
8. References

Pi Network’s Open Mainnet: Progress or Promise?

On a page called “mainnet2024,” the Pi Network team promised to launch the project’s Open mainnet if three conditions were met. These include 15 million Pioneers passing KYC, 10 million Pioneers migrating to beta mainnet, and 100 mainnet-ready apps.

As per the latest update from the project in August, the network has reached over 13 million Pioneers who have passed KYC and over 6 million Pioneers who have migrated to Mainnet. For some, there’s still a long road ahead to meet the predetermined conditions.

The network has reached over 13 million Pioneers who have passed KYC and over 6 million Pioneers who have migrated to Mainnet! Through our collective efforts, we’re progressing towards the Open Network goals. Keep in mind that the progress is not linear and has been accelerating… pic.twitter.com/fXad6mpe59

— Pi Network (@PiCoreTeam) August 8, 2024

Concerns were raised by analysts at CCN, who used ExplorePi and Pi Door to determine that there are between 6.15 and 6.19 million Pi wallets.

As the analysts said:

“With 60 million users, why are there only about 6.2 million wallets — just 10% of the total user base?

“Even more concerning is that these wallets represent only 51% of the KYC-verified users. So, where are the remaining millions?”

The team did note that it is possible the missing millions are still on Testnet rather than Mainnet, but there is quite a gap. The team also pointed out the 100% inflation in Pi’s circulating supply over 12 months as a cause for concern.

Perhaps the long-awaited open mainnet launch will answer many questions – settling doubts about whether the project is vaporware or a serious contender for payments.

Pi Network & The Ad Revenue Model

Pi Coin started in 2019 when a team of Stanford University graduates focused on accessibility launched the project, aiming to become the world’s most widely used peer-to-peer ecosystem.

It is a slow road, with major blockchain projects like Ethereum and Cardano achieving functioning mainnets within two years, whereas Pi Network has now surpassed five years without an open mainnet launch.

Reddit user u/WasteSatisfaction282 wrote in a post on the official Pi Network subreddit:

“Pi coin is a scam that benefits its Stanford-educated founders. First, Pi Coin is not a new cryptocurrency. For one, the Android app was published in December 2018. Four years later, Pi holders cannot do anything with the app.”

Until then, a number of Pi Network miners have questioned Pi Network’s monetary value due to its reliance on ads. The project is currently making money with the advertisements on its app, but the development progress has been slow.

“Every time you click on mine, it prompts an ad,” another Reddit user said. “[It’s a] heavy procedure just so you could start transferring your money on the guise of KYC.

“In reality, it just works as a siphon so they could give a few people some of their ad cut. Ofc its a scam jeez.”

However, the project does allow users to turn off ads. Furthermore, the ads were reportedly voted on by the community to support the server’s cost.

But it does lead to a question: is Pi mining really mining? Cryptos like Bitcoin and Ethereum (ETH) use Proof-of-Work (PoW) or Proof-of-Staking (PoS) to validate their networks. Does tapping a phone screen produce the same value, or do any of the built-in safeguards those models provide? Or is it more akin to tap-to-earn models?

Is Pi Network Safe or Selling Your Data?

Another concern regarding Pi Network has been related to its data privacy practices, particularly the extent to which user data is collected and shared.

The project’s privacy policy reveals that Pi Network collects a wide range of data, including personal information like email addresses, app usage patterns, and even user interactions within the app. The platform’s privacy policy also permits the sharing of these data with third-party advertisers.

“We do not share any data with ad networks directly. However the ad networks used inside our apps may request directly from your phone’s operating system, such as iOS or Android, an anonymized advertising identifier in order to for them to serve you with more relevant ads,” the privacy policy page reads.

Nevertheless, the extensive data collection and sharing practices have raised concerns among privacy-conscious users.

“Data gathering through app installs is a big thing,” one Reddit user said. “It’s the data collection alone that is worth running a network like this.”

Could a Full Launch Lead to Success?

Pi Network’s user-friendly approach has attracted a substantial user base, which could suggest a strong initial product-market fit. However, the success of Pi Network’s open mainnet launch (which so far is not supported by technical documentation) will depend on its ability to deliver tangible utility and value to its users.

Ostensibly, the developing team knows this. This is why one of the conditions for the launch of the open mainnet is 100 apps.

The team continue to offer bullish metrics, with PiFest Day 2024 seeing, as per the team, 27,000 active and 28,000 test (business) sellers from over 160 countries (and talking elsewhere of 60M+ engaged Pioneers).

PiFest 2024 saw real-world engagement as Pi-powered businesses registered for the event—over 27,000 active and 28,000 test sellers from over 160 countries—and over 950,000 unique Pioneers used Map of Pi to browse and search for local stores to participate in PiFest. From bustling… pic.twitter.com/Sw2DCNMZMy

— Pi Network (@PiCoreTeam) November 23, 2024

While the exact number of Pi Network dApps available so far is unclear, a repository shows that there are 28 decentralized apps (dApps) in areas like commerce, games, and NFTs.

However, some considerations have also been given to these apps. “None of them are very polished,” one Reddit user wrote.

The Bottom Line

While Pi Network is a functioning project with a growing user base, it remains in its “enclosed mainnet” phase, restricting external connectivity and trading of Pi coins. This has led to a series of allegations against the project, with some even claiming that Pi Network is a scam.

We remain unconvinced in either direction — if the number of holders and miners is legitimate, a full mainnet launch could lead to a quick market fit or easy ways to form partnerships with retail. The Pioneer Army will be out in full force when the open mainnet arrives.

But we also note there is no whitepaper, no close way to monitor developer work, no long-awaited mainnet, and reliance on the team that the numbers are correct. This could go either way.

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