In a market dominated by cryptocurrency like Bitcoin, Ethereum and players big and small, it can seem daunting to really get into the new phenomenon that is crypto.
Even though we are seeing all-time highs, you might think that you’re too late to actually get anything out of this new wave.
That was the thinking behind the creation of Pi.
This up-and-coming cryptocurrency is just starting to gain momentum and is promising a crypto without barriers.
Back when Bitcoin (BTC) was first introduced and worth pennies, back when someone bought pizza with one BTC, it was viable to make money off mining. As BTC and other coins have gained popularity though, we’ve seen entire companies springing up with hundreds of thousands of dollars or even millions of computational equipment to take advantage of mining. And as more and more halving occurs, an individual looking to get any returns from mining is becoming smaller all the time.
Enter Pi.
Boasting a cryptocurrency that is accessible to all with faster and more secure transactions, Pi is the latest player that is looking to differentiate itself from the hundreds of altcoins out there.
It’s doing this by using a different form of blockchain management than most coins. Known as the Stellar Consensus Protocol (SCP), Pi looks at a collaborative model of managing the blockchain.
You can read all about SCP by clicking here, but here’s a basic-level understanding of the system:
Individual nodes (users) are invited into the SCP system. These new nodes must prove their trustworthiness by contributing to the verification of transactions and the creation of new blocks on the chain. Once they have proven they are trustworthy, a node joins a circle of other nodes that collaborate to verify blocks very quickly.
This collaborative model allows for a much faster process with far less processing power. As a result, Pi mining can be done with mobile phones. While the overall system does rely on computers running the software as the SCP backbone, the Pi app is what does most of the mining.
Since Pi is in its pre-market stage and is reliant on many people working together to build what they call the global trust graph—the network of nodes that verify transactions—they are currently incentivizing users to participate and invite new users into the Pi network.
This has resulted in different roles within the Pi network based on the trust your node has earned.
A Pi Pioneer is someone who has been invited to use the app. Pioneers open the app once a day to confirm that they aren’t a bot and continue their mining of Pi.
A Pi Contributor is a Pioneer whose node is participating with other Pioneers to mine new blocks. Contributors are the very foundation of the global trust graph in the SCP framework.
A Pi Ambassador is someone who introduces new members to the Pi network. As those they introduce remain active, Ambassadors earn increased amounts of Pi.
A Pi Node user is a Pioneer who doesn’t just use the mobile app but also runs a Pi node on their desktop. This helps fuel the core software that utilizes the consensus created by node groups in the network.
As the value of Bitcoin has continued to increase, it has changed from a couple hundred miners running the entire blockchain to those massive companies profiting from the mining process. As mentioned, it’s now very difficult for an average individual to get into BTC mining in a meaningful way.
By using the SCP framework and enabling mining on mobile devices, Pi is standing out from Bitcoin by making it more accessible for individuals.
Furthermore, Pi boasts a faster transaction speed than mining a new block on the BTC blockchain. Currently, it takes 3-5 seconds to log a new block in the Pi network compared to upwards of 10 minutes for Bitcoin.
There are two primary reasons for this. First, Pi has gained a strong following but doesn’t have many practical transactions occurring. Bitcoin, on the other hand, has hundreds of thousands of transactions occurring every day.
Second, the foundation of mining is different between the two blockchains. By utilizing the Stellar Consensus Protocol framework, Pi uses a collaborative approach to mining. Oppositely, Bitcoin uses a competitive model.
To log a new block in the BTC chain, miners are constantly racing to solve a random equation that will create the new block and log a transaction. Only one miner or node can get the right answer, resulting in a waste of time and computational power from everyone else involved.
While this has produced benefits in efficiency and time, it also means that the environmental impact of Pi is many times lower than that of Bitcoin, which has been heavily criticized for having a carbon footprint on the same level as the entire country of New Zealand.
To put it bluntly, a single Pi coin is currently worth nothing. Zero.
As a pre-market coin, Pi is trying to gain the following and put the network in place to be effective when it launches, which means that you cannot exchange Pi for actual money right now, nor can you exchange it for a service or good.
But the creators of Pi point out that Bitcoin had no value when it was in its infancy, either.
There are very few people who would not want to get in on the ground floor of Bitcoin back when it first launched, if they could, but it wouldn’t be logical to think that Pi—or any coin—will ever get to the astronomical value that BTC has now.
Because Pi is pre-market, it has drawn some criticism online. Re-enabling your mining every day prompts a video ad that the app creators profit from, which means that it is income-generating for those who have a stake in the app itself.
Also, the idea of you benefiting from recruiting more people into the network leaves a sour taste in the mouths of some, with a feeling similar to a pyramid or multi-level marketing scheme.
That being said, proponents of Pi are quick to point out that there is no investment needed in the crypto coin right now, which clearly differentiates it from pyramid schemes and MLMs.
In its current form, Pi only requires a moment of time invested each day.
