Pi Network — Is It Going To Be A Threat for Bitcoin in The Future?
I do think that this is a pretty big shoe to fit but there are also some striking similarities between the two cryptocurrencies.
One thing you have to know is that the idea of the Pi network really derived from bitcoin. The original idea of bitcoin was to create a decentralized currency that’s used like cash and the creator here wanted to see people use bitcoin instead of cash for everyday transactions.
One of the reasons that he or she did this is because they had a distrust of institutions especially right after the 2008 financial crisis. During this time banks and institutions failed to protect the average person. Instead, they were the reason for the collapse and our money was used to bail them out.
I think this movement really launched the start of blockchain and also cryptocurrencies in general. And from this bitcoin was introduced.
The general public and over the years I think the idea of cryptocurrency has really started to gain some traction and I’ve no doubt that it’s only going to get bigger and bigger from here. And although many people feel that cryptocurrencies, in general, will become more and more popular.
Many people doubt that bitcoin will continue to remain in the first place and this is because the design of bitcoin failed to make it in everyday currency. And I really do think that this is where the Pi network or Pi coins can step up to the plate.
You see there’s a lot of things about the Pi network that makes it suitable to become what bitcoin wanted to be. One of the things that bitcoin failed to be as inclusive or accessible to anybody and everybody around the world.
You see in the early days of bitcoin you had to have a lot of knowledge to be able to mine bitcoin. In fact, it was pretty inaccessible to the average person and it was also very expensive as well.
Mining bitcoin required a lot of computing power and not everybody had that. And those with a lot of computing power started to get a bigger and bigger chunk of the network.
You see about 87% of all bitcoin are owned by 1% of the network and these few individuals have gotten so big that they’re making billions of dollars in profits each year from money bitcoin. And even though bitcoin is technically decentralized. A very small number of people do have control over the network.
I think the creators of the Pi network realized this to be a problem and instead of forcing people to use computing power to mine coins, they allowed people to mine just from their phones.
And anybody around the world will now have the ability to mine Pi coins from the Pi network just using a mobile device. I think this ends up creating a much more fair system compared to bitcoin.
The wealth here is going to be much more evenly distributed among miners and one of the reasons that this is possible is the network uses the stellar consensus protocol.
The basic idea here is that we’re not actually mining any Pi coins from our phones. Instead what we have on our phone simply serves as a record for the developers here.
The developers here are going to distribute Pi coins based on these records when the time comes.
I think this is a pretty elegant way to bypass the need for computing power to be able to mine any cryptocurrency and it also helps anybody increase their stake on the network by simply promoting it. Thus basically creating a much fairer system compared to bitcoin.
And apart from being much fairer than bitcoin, the Pi network does a great job at having an adequate amount of scarcity.
You see one of the problems with bitcoin is that it’s too scarce to be considered a medium of exchange or cash. There are about 21 million bitcoins and this makes bitcoin much too expensive to be used like cash.
A single piece of bitcoin is around 50,000$ and because of this, I can’t see individuals making purchases with full bitcoins. Instead, I only see corporations maybe using bitcoin to make large purchases.
One of the things that I really love about the Pi network is that it balances this element of scarcity.
In my other article, I was able to get a rough estimate of how many Pi coins there are out there and I came up with about 83 billion coins and after doing a few other calculations I was able to figure out that the price of a Pi coin should be around a dollar and 70 cents.
This price did align with some of the websites that do try to estimate the price of a Pi coin but much of this is still based on a lot of speculation.
What I can say for sure is that the price of a Pi coin would not be anywhere close to the price of a bitcoin. Instead, I think the goal here is to try to make cryptocurrency usable in everyday transactions. And that might be anywhere from a couple of dollars and beyond. And therefore if you really think about it the Pi network or Pi coins might actually be what bitcoin wanted to be. Instead of being a medium of exchange.
Bitcoin became a store of value. It became something that people collected hoarded and saved instead of spent and that really defeated the original purpose of bitcoin.
I do want to say that the price of Pi coins might increase in the future but it wouldn’t increase it the same way that bitcoin does.
A piece of bitcoin literally turns from a couple of cents to fifty thousand dollars in a couple of years. I doubt that we’re going to see the same type of growth simply because there are a lot more Pi coins in the world than bitcoins.
This isn’t impossible but I doubt that this is an intended purpose of the creators here an example of why a Pi coin can’t increase a lot in value is because of stellar.
Stella is a type of cryptocurrency that has a supply of 22 billion. It doesn’t actually have the same supply as a Pi network but it’s pretty close compared to other cryptocurrencies. and it’s been increasing in price similar to bitcoin over the years.
What this really says to me is that even with a large supply of Pi coins the price is still very movable. It’s likely to follow the price of bitcoin for a while since bitcoin is still number one.
But I do think that over time as Pi coins continue to be used they will be able to establish their own price.
The price is determined by supply and demand and as more and more people buy, use, or even read about the Pi network the higher the price is going to be in the future. This is because all these things create immediate demand or future demand for Pi coins.
Unlike a lot of other cryptocurrencies that end up in the cryptocurrency graveyard. The pi network here actually has a pretty strong network of supporters this helps to make sure that the Pi coin doesn’t die on release and also helps to immediately protect and increase its price upon release.
This basically makes sure that the Pi network doesn’t suffer the same fate as bitcoin during its early days. I think we’ve all heard stories of people throwing away hard drives full of bitcoins or using them to purchase the most ridiculous things like stickers or pizza.
But one thing you have to realize is that many of these people didn’t see a demand for cryptocurrencies back then in fact it’s not hard to conceptualize that many of these people simply thought this craze was gonna die.
This is one of the reasons I love seeing promotional codes about the Pi network on my articles
This just means to me that the network is still very very alive and also that many other people will see these comments and some of them might even become interested in the Pi network themselves.
I really do think that the referral system here is probably one of the most intelligent things about this project because without it this would just be another cryptocurrency out of thousands of other cryptocurrencies without any value. Instead what we have here is that without the currency being officially launched we already have people speculating about its value.
There also will be a lot of officials and also unofficial places where the Pi network or Pi coins will be officially used.
Right now the pi network has about 13 million official users. This is actually pretty far from the ultimate goal of 100 million users. But as it gets bigger and bigger it’s also a lot easier for the network to grow exponentially.
I do think that we’re going to get close to 100 million users by the end of this year and this might not be close to the number of people who adore bitcoin but it’s still pretty significant nevertheless and the goal from the developers here is to release Pi coins as a decentralized cryptocurrency by the end of this year.
This means that whatever concerns questions and doubts you have about the Pi network will be answered by the end of this year.
What we can see so far is that Pi coins really address a lot of the issues with bitcoin like I said bitcoin was created to become a medium of exchange but it ended up being a store of value.
It was way too scarce and inaccessible for the average person and because of that few mining companies now own the majority of the bitcoin supply.
These include companies in china, companies in Southeast Asia, and also companies in America and they own so much bitcoin that they pretty much have control over the network itself.
I think many of these things prevent bitcoin from becoming decentralized cash therefore decentralized cash will have to come from somewhere else.
As of right now the closest competitor that I can think of will be Pi coins and this is because almost anyone around the world can have access to a cell phone which will allow them to mine Pi coins.
Mining is actually not very difficult and scarcity is also built onto the network since the supply is fixed and the reward gets less and less over time. And not to mention the popularity of Pi coins which are increasing day by day.
Basically, the takeaway here is that the pi coin might actually do what bitcoin failed to do in the first place and although it might not grow to the same price as bitcoin simply because of the mechanics on the network. It will still offer a steady increase in price in an actual use case in the world.