Is Pi A Scam?

Pi has the trappings of a Ponzi scheme and a pyramid scheme, although this may not necessarily be the case. For sure, its current market price is a bubble, sustained by the greater fool theory. The bubble was caused by delaying the cryptocurrency’s release into the mainstream market, thus causing the usual “pre-launch” speculative rise in price, in this case which has lasted too long.

Once the crypto is released into the mainstream market, that valuation is bound to be wiped off. This explains why the release is continually (indefinitely?) delayed, so as to keep the price high. This may not have been the intention of the founders.

Many Ponzi schemes do not start out with the intention of becoming Ponzi schemes, but having lost the initial momentum, the founders find it easier just to pay old subscribers using money generated from new ones. Which is exactly what pi is today.

What is Pi Coin?

Pi is a cryptocurrency that was designed as a medium of exchange, a useful coin which people could actually use for buying and selling. The website says it was designed by Ph.Ds. at Stanford University, at the height of the bitcoin craze. With Pi, people with mobile phones could actually mine the coin, in contrast to bitcoin mining which required big, expensive mining rigs.

That sounds like a revolutionary concept; if small people can mine a cryptocurrency using their mobile phones, then acceptance of that coin can skyrocket. Theoretically, acceptance is money, and so anything that is accepted as a means of exchange is money.

Many people registered, and “mined” the coins which they later sold to new investors for quite some huge profits. Now, those new investors are selling to other investors at even higher prices, and on it goes.

Therefore if you can mine pi off your phone, then that’s great money. But…

Do You Really Mine Pi Coin?

That is the question. Obviously the app has a button labelled “mine” which when clicked rewards users with coins. However, that is not what it means to mine something. Mining means supplying your computer’s computational power to participate in a blockchain.

With Pi, users click a button, and then after a preset amount of time, they receive a preset amount of coins. Users do not contribute anything to the blockchain, and users certainly do not mine Pi.

That is not to say that the Pi app is useless. In fact some good can come from the regular interaction of millions of people with the app and web interface. The developers quickly understood that.

The Pi App Makes Millions

The developers of the Pi app quickly understood the potential of having a website visited daily by millions of people. They added selling advertising on the Pi app in May 2020; purportedly to generate funding for the project.

That means the developers understand that there is a very small chance of success of the cryptocurrency, and so they are cashing out now.

This is a contrast to what the ordinary people are doing; with the high quoted price of the asset it seems too good to ignore.

Is Pi Coin A Good Investment?

Pi coin is quoted at $35.72 as at November 11, 2023, making it one of the most valuable coins in the cryptoverse. Does that make Pi a good investment?

It depends… would you buy a scam just because you would make money from it? If the answer is “yes,” then yes, Pi is a good investment. However, please note that good investments, when badly timed can amount to losses.

The price of Pi could go higher and yield a profit; bubbles have been known to last several years. The only thing that could destroy Pi’s valuation would be to release Pi into the global blockchain, in which case it would be traded between people, and between exchangers. This is explained in the paragraph below.

But for now, the price of Pi will probably stay high.

Will Pi Be Released To The Open Mainnet?

Will Pi be released to the Open Mainnet, and be tradable between people and exchangers? That seems very unlikely. The official reason is that only 5 million users out of 47 million have been verified.

The unofficial reason is that Pi would plummet from around $37 – $40 to somewhere around $0.30-$0.40.

That would mean not just an annihilation of value, but would completely destroy Pi as a crypto, and as a project- wiping it from history.

This is because so many of those who are attracted to Pi are only interested in the prospect of making money, and as soon as the reverse happens, they will immediately flee from the crypto. Furthermore, such a crash in price will discourage people; making them stop interacting with the Pi App.

The Pi App is a valuable source of advertising revenue to the developers; it is their cash cow. Would you kill your cash cow?

Is Pi A Scam?

Short answer is yes. It is not a cryptocurrency in the real sense of the word, it is not mined, and it is not likely to be released to the mainnet (blockchain, open cryptoverse) any time soon.

Pi is therefore a pyramid scheme in which users are required to bring in more users as down lines, thus gaining more as those they brought in keep bringing more people.

The Developers make money by selling adverts. In other words, they have no faith in the possibility of their own coin becoming an asset of value anytime in the future.

Further Reading:


While the market still looks good (as at November 2023) for Pi, there is need for caution. Pi may continue to make money in the next few years, but as with all Pyramid schemes, it will eventually run out of new users.

When new users stop coming, the price of the crypto will take a hit. Many new investors will see huge loses in their capital, and that will cause a panic. A panic is bad in speculative assets, and history has proven that it is especially terrible in crypto.

All bubbles burst eventually, and while there is still a chance that this one may continue for quite some time, there is no doubt that it will eventually go the same way as others before it.

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