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Cryptocurrency

The Pi Network: FAQs and Insights Before Mainnet Launch

2024-11-28

Everybody is buzzing about the Pi Network, a decentralized cryptocurrency project developed by Stanford graduates in 2019. It enables users to mine crypto right from their smartphones, aiming to make crypto more accessible to the masses. But with so many questions surrounding it, this article is here to provide all the answers.

Discover the Pi Network - Your Gateway to Decentralized Crypto

What is the Pi Network “Mainnet”?

The Pi Network is a unique cryptocurrency project that allows users to mine digital currency through a smartphone app. The Mainnet, or Main Network, is crucial as it facilitates real cryptocurrency transactions. It provides a decentralized and secure environment for users to store, receive, and send digital assets. The launch of the Pi Network Mainnet is expected by the end of 2024, generating a lot of anticipation. 1: The Pi Network's Mainnet is the backbone that will make the digital currency truly functional. It will allow for seamless transactions and the transfer of value between users. This is a significant step in the evolution of the Pi Network and will bring it closer to mainstream adoption. 2: Once the Mainnet is launched, users will be able to experience the full potential of the Pi Network. They will be able to trade their mined Pi coins with confidence, knowing that the transactions are secure and decentralized. This will open up a whole new world of possibilities for users.

What is the difference between Pi coins, tokens, and IOUs?

The Pi Network has a large user base called "Pioneers" who are accumulating "Pi coins" by engaging with the app. These Pi coins are the actual digital network currency, but they are not yet fully accessible or transferable as the Mainnet has not launched. Due to the high interest in the network, Pi IOUs have emerged as a more generic representation of the currency. 1: Pi IOUs are not real Pi coins but rather speculative assets that represent a promise by certain exchanges. When the Mainnet launches, these IOUs can be swapped for actual Pi coins. This creates a sense of excitement among users as they speculate on the future value of Pi. 2: The difference between Pi coins and IOUs is important to understand. Pi coins have intrinsic value as they are the native currency of the Pi Network. IOUs, on the other hand, are more like a placeholder until the Mainnet is launched. They give users a taste of what is to come but are not yet fully realized.

So, how do I get the Pi coins or Pi IOU tokens?

The only way to obtain Pi coins is by mining them through the Pi Network app on your smartphone and actively participating in the network during this development stage. The app is free to download and use, so there are no upfront costs. However, the coins cannot be exchanged for other currencies or commodities at present. 1: Mining Pi coins requires dedication and participation in the network. Users need to be active and engage with the app on a regular basis to increase their chances of mining more coins. It's a community-driven effort that rewards those who are committed. 2: While the current value of mined Pi coins is zero, there is potential for them to increase in value once the Mainnet is launched. This makes mining Pi coins an interesting proposition for those who believe in the future of the network.

Why am I hearing about KYC in the Pi Network?

To ensure that your Pi coins have value when the Mainnet launches, you need to complete the Pi Network KYC (Know Your Customer) verification. This process requires meeting certain criteria and providing legal documents. 1: Being 18 years or older is a basic requirement for KYC. Applicants also need to have original copies of government-issued IDs such as a national ID, driving license, or passport. These documents are used to verify the identity of the user. 2: In addition to providing documents, users also need to undergo a liveliness check via their phone's camera to match their ID. This adds an extra layer of security to the KYC process and helps prevent fraud.

Is Pi IOU Worth the Investment?

With the impending Mainnet launch, the prices of Pi IOUs have seen a significant increase, presenting an exciting opportunity. However, investing in them comes with risks as they are highly speculative. 1: The value of Pi IOUs is not guaranteed to maintain or increase after the Mainnet launch. There are many factors that can affect the price, such as market conditions and exchange policies. Investors need to be cautious and do their research. 2: Additionally, Pi tokens are currently available only on select platforms, so investors need to stay updated on the latest developments. It's important to make informed decisions and not get carried away by the hype.

Bitcoin has witnessed an astonishing surge to an all-time price peak, leaving many in the cryptocurrency world wondering about its future trajectory. With Donald Trump's return to the White House on the horizon, advocates of this digital asset hold high hopes for its continued growth.

Unraveling Bitcoin's Future Amid Political Tides

Bitcoin's Price Surge and Its Aftermath

After the price of bitcoin skyrocketed from approximately US$69,000 (£54,000) on November 5th to nearly US$100,000 currently, cryptocurrency enthusiasts are closely observing the next moves in US politics. This significant price jump has not only captured the attention of investors but has also sparked discussions about the potential impact of political decisions on the cryptocurrency market.Bitcoin's value has been on a rollercoaster ride, and its recent ascent to new heights has raised questions about its sustainability. While some believe that the cryptocurrency's growth is driven by fundamental factors such as limited supply and increasing demand, others are cautious about its volatility.

Trump's Crypto Pledge and Its Implications

During his campaign, Donald Trump pledged to make the US the "crypto capital of the planet" and even suggested that the US might pay off its national debt using cryptocurrency. Many of his future cabinet members and inner circle are reportedly pro-crypto, including Robert F. Kennedy Jr., who has stated that he holds "most" of his net worth in bitcoin.This crypto-friendly stance from the Trump administration has had a significant impact on the cryptocurrency market. It has led to increased interest and investment in bitcoin, as well as the introduction of various crypto-related policies and initiatives.For example, Republican Senator Cynthia Lummis of Wyoming has proposed the Bitcoin Act of 2024, which aims to increase the US government's ownership of bitcoin and enhance its supremacy in the geopolitical competition for this asset. In Texas, Dennis Porter, CEO of the Satoshi Act Fund, is in "discussions" to help introduce a bitcoin strategic reserve. Pennsylvania has also passed a new bitcoin "rights bill" and is considering creating a strategic reserve.

Reasons Behind Bitcoin's Bullish Outlook

Aside from political promises, several other factors are contributing to bitcoin's bullish outlook. One of the main reasons is the expectation that the US Federal Reserve will continue to print money to finance the country's growing debt. With the federal debt currently at around US$36 trillion and still increasing, many investors see bitcoin as a hedge against inflation.Since the supply of bitcoin is finite, with only 21 million coins to be mined, it becomes an attractive asset in a situation where the money supply is expanding. As more money flows into this scarce asset, its price is likely to rise.Another factor is the expected regulatory clarity from the Trump administration. While it doesn't necessarily mean more deregulation, a clearer set of rules for trading crypto assets will provide more certainty to investors and encourage greater institutional adoption.For instance, many bitcoiners have been critical of Securities and Exchange Commission (SEC) chairman Gary Gensler, who they believe has been overly restrictive on the crypto industry. However, with Gensler set to step down in January 2024 and a new Trump-appointed SEC chairman likely to be more crypto-friendly, there is hope for a more favorable regulatory environment.Finally, the increased institutional adoption of bitcoin by financial investment advisories and banks is also driving up its price. Earlier this year, the SEC was compelled to approve "spot" bitcoin exchange-traded funds (ETFs), which have made it easier for both corporate and individual investors to access bitcoin. This has led to the entry of major financial players such as Fidelity and BlackRock into the bitcoin space, signaling mainstream acceptance of the cryptocurrency.

The Partisan Divide in Bitcoin

A looming question about bitcoin is whether it remains a partisan issue. While Republicans have generally been more supportive of bitcoin as part of an economic "freedom" agenda, many high-ranking Democrats have been more skeptical.For instance, Massachusetts Senator Elizabeth Warren has been described as leading an "anti-crypocurrency crusade." However, other Democrats like New York Senator Chuck Schumer have sought to reduce federal restrictions on trading crypto assets.Republicans are trying to capitalize on their perceived advantage on this issue. Trump's pick for Treasury Secretary, Scott Bessent, has insisted that the "crypto economy is here to stay."Meanwhile, chief executives of major crypto companies are vying for a seat in Trump's proposed crypto council, which will provide advice on crypto policy.The future of bitcoin remains uncertain, and it remains to be seen whether Trump will truly champion digital assets or disappoint bitcoiners. As the cryptocurrency market continues to evolve, it will be interesting to see how political decisions and market forces interact to shape its future.

The cryptocurrency markets have witnessed a remarkable journey this year. Once plunged into a cold winter during 2022, with the cumulative value of every coin and token in the market falling to just $828 billion from a peak of $3 trillion in 2021, the industry has now emerged in a much stronger position. The total value of all cryptocurrencies in the market now sits at a new record high of $3.5 trillion.

Unraveling the Crypto Conundrum - Which Coin Reigns Supreme?

The Case for Dogecoin

Dogecoin, with a remarkable 362% gain this year, is still trading below its 2021 record high of $0.73. Just two months ago, it was near a 52-week low. However, everything changed when former President Trump won reelection with the help of Tesla CEO Elon Musk. Musk, a vocal advocate of Dogecoin in 2021, regularly promoted it on social media using memes and even participated in a related comedy skit on Saturday Night Live. But unfortunately, the cryptocurrency plunged by 92% after that event as investors realized there was no concrete plan to back up his support.Simply put, Dogecoin's 2021 rally was built on speculation, and this time seems no different. After Trump's election win on Nov. 5, he announced the formation of the Department of Government Efficiency, or D.O.G.E for short, with Musk set to run it. This seems to be a driving force behind Dogecoin's recent surge, although there is no indication that the token will play a role in the new government department. Even if Musk finds a use case for Dogecoin, it may not lead to more upside. Currently, only 2,520 merchants worldwide accept Dogecoin as payment, and many of them are obscure internet companies and online gambling platforms. This lack of utility is a significant hurdle for Dogecoin to create sustainable value for investors.

The Case for Shiba Inu

Shiba Inu rose to fame shortly after Dogecoin and delivered one of the best returns in financial market history in 2021, soaring 45,278,000%. If you invested just $3 in Shiba Inu on Jan. 1, 2021, your position would have been worth over $1 million by Dec. 31. But like Dogecoin, Shiba Inu lost over 90% of its peak value in 2022. Speculative frenzies don't last, and this meme token lacks a prominent figure like Elon Musk to keep investors interested.In 2024, Shiba Inu has gained 146% on the back of improving sentiment across the crypto industry. However, it is still not even halfway to reclaiming its 2021 all-time high. The Shiba Inu community has tried to create new use cases to support its value, such as building a metaverse where investors could spend their Shiba Inu tokens to customize virtual blocks of land. But three years later, the virtual world still hasn't launched. Only 1,032 merchants worldwide accept Shiba Inu as payment, indicating even less real-world utility than Dogecoin. Therefore, it's not surprising if the latest rally eventually fizzles out.

The Case for Bitcoin

Bitcoin is the world's largest cryptocurrency, with a market capitalization of $1.9 trillion, accounting for over half of the crypto industry's total market cap. With a year-to-date gain of 121%, Bitcoin is up less than Dogecoin and Shiba Inu but is actually trading at a record high.Unlike Dogecoin and Shiba Inu, Bitcoin doesn't have widespread acceptance as payment in daily shopping places. However, it has become a reliable store of value, with many experts comparing it to digital gold. The U.S. Securities and Exchange Commission (SEC) has approved dozens of Bitcoin exchange-traded funds (ETFs) this year, providing financial advisors and institutional investors with a regulated way to own the cryptocurrency. The top 10 ETFs alone manage almost $100 billion in client money, and as this number continues to grow, it foreshadows further upside in the price of Bitcoin.The value of above-ground gold reserves worldwide is currently $18 trillion. If the wider investment community truly adopts Bitcoin as a digital alternative to gold, it could imply a price-per-Bitcoin of around $909,000, representing a potential 826% upside from its current trading price. Some Wall Street analysts even think Bitcoin can go even higher in the long run. For example, Cathie Wood's Ark Investment Management believes the price of a single Bitcoin could rise to $1.48 million by 2030 based on eight potential factors, including adoption by institutional investors and becoming digital gold.

The Verdict

All three cryptocurrencies are speculative assets, and investors buy them mainly in the hope of higher prices in the future. However, Bitcoin probably has the best chance to deliver long-term upside. Despite several steep corrections over the last decade, it has always recovered to make new highs, instilling more confidence in investors about its effectiveness as a store of value. On the other hand, Dogecoin and Shiba Inu have not shown the same resilience and are unlikely to win the support of regulators or institutional investors in the future. Therefore, if you are considering buying either of them, proceed with caution.