The Pi Network is set to undergo a significant transformation in its cryptocurrency model, moving away from traditional mining and embracing a Delegated Proof of Stake (DPoS) consensus mechanism. This shift marks a pivotal moment for the blockchain project that began in 2019 with a mission to make cryptocurrency more accessible to everyday users.
Founded by Stanford graduates, Pi Network emerged as an approach to cryptocurrency mining. Unlike traditional crypto mining that requires expensive hardware and consumes massive amounts of energy, Pi Network allowed users to “mine” coins simply by tapping a button daily on their mobile app. The project utilized the Stellar Consensus Protocol, making cryptocurrency participation possible for anyone with a smartphone.
How the DPoS System Works
The network is transitioning to a DPoS system where token holders can stake their Pi coins and earn rewards. Instead of mining, users will now receive a 5% annual return on their staked tokens. This change represents a fundamental shift in how people will interact with and benefit from the Pi Network.
The move to DPoS brings several important considerations for the Pi community. By allowing token holders to vote for network delegates, the system aims to improve transaction. However, this approach comes with its challenges, particularly around decentralization.
Mining rewards will be Zero after launching the Pi Stable Coin, Only Staking!
— Himanshu (@himanshumgr2) March 28, 2025
✅ No mining, no rewards – Pi moves to DPoS for efficiency
✅ Stake Pi, earn 5% rewards instead of mining
⚠️ Risk of centralization – Large holders may dominate#PiNetwork #CryptoNews#himanshumgr pic.twitter.com/AFDGVWwFsJ
One major concern is the risk of centralization. Large token holders could potentially have a disproportionate influence on network governance. This goes against the original vision of making cryptocurrency accessible to everyone.
Read Also: Expert Calls Pi Network a ‘Straight-Up Scam’ — Here’s Why
Potential Impact on Pi Value
The staking model could have significant implications for Pi’s economic dynamics. By implementing staking, the network may create artificial scarcity as tokens get locked up, potentially driving up the token’s value. The new system could also make Pi more attractive to institutional investors, who often prefer more stable and scalable blockchain technologies.
As Pi Network moves forward with this transition, the crypto community will be watching closely. The success of this shift will depend on maintaining the project’s core principle of accessibility while introducing a more sophisticated economic model.
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