A lot of us are regretting not jumping on the cryptocurrency-wagon when it hadn’t become the hype that it is today. Like the internet in the 1970s, people just didn’t care to believe that it could manifest into something substantial. Now trusted worldwide by many banks and institutions as currency and being accepted as payment by big accounting firms such as KPMG, cryptocurrency is slowly becoming a part of the digital payments system. The only thing acting as a barrier is national governments regulating it and accepting it as a unit of value for carrying out transactions.
Assuming you know the basics of cryptocurrencies and what blockchain technology is, let us talk about Pi.
For all those late at the crypto party, there is a chance of redemption- Pi.
What is Pi Crypto?
Pi is a cryptocurrency that has been created by graduates from Stanford University in response to the following limitations posed by Bitcoin today:
1. Centralization of power– The ease of mining Bitcoin in the earlier days when it was introduced allowed various companies to use multiple processors’ computing power in order to reap the benefits of the Bitcoin Gold Rush. This led to 1 percent of the network owning 87 percent of the total available coins.
This has made bitcoin mining for all practical purposes fruitless for individuals since the net benefit from mining is quite less considering the vast amount of electricity resources one needs to mine bitcoin.
2. Bitcoin Consensus Algorithm– Bitcoin consensus algorithm makes use of the distributed system technology that elects the nodes in the system as a leader who produces the next batch of transactions. It then uploaded on the blockchain to be verified by the community. Trust and security are maintained due to the fact that becoming a leader requires vast computing power and energy resources. The ability to solve complex puzzles ensures that the node that achieves leader status inputs authentic and true transactions. This however is not an environmental-friendly option.
Stellar Consensus Protocol (SCP)
Contrary to Bitcoin’s ‘proof of work’ consensus, the Pi network uses a consensus algorithm based on Stellar Consensus Protocol or SCP. This technology doesn’t waste energy and is superior since it ensures that recording power does not accumulate only with the people possessing the highest computing power.
To determine if a transaction is valid or not, quick voting over the network takes place using cryptographic signatures to ensure authenticity. Pi builds on the SCP technology by allowing people to ‘mine’ through their mobile devices.
Pi miners can play 4 major roles in the Pi crypto network:
- Pioneer– A user of the Pi app that simply ensures they are not a robot by logging in and pressing the ‘mine’ button on the app on a daily basis
- Contributor– A user of the app that contributes to the Pi network by adding various other users that they know, thus ensuring trust in the network.
- Ambassador– User of the Pi mobile app introducing other members into the network.
- Node (to be released)- A user that will along with the above-mentioned duties also run the desktop software that will run the core SCP algorithm. This software is yet to be released.
Open Source Application
Pi Node software will be released as open-source software, relying on SCP technology which is also open-source. This means there will be suggestions for improvement within the community, and people will be able to message in their views and thoughts and interact with the Pi community.
1. Design and Distribution through Emulator – The Pi server is operating as a model or beta, emulating what the actual network will look and act like. All the mined coins belonging to users will be blocked and allocated equivalently in the actual network once the Pi network enters the Mainnet phase.
2. Testnet– Prior to launching the main net, the test net will be live with the core team adding nodes and encouraging other users to add nodes themselves by using the Pi Node software. This software will be launched in the Testnet to see if the network integrity sustains itself. The Testnet will be launched parallel to the emulator in phase 1, and continuous iteration will take place until the results of the emulator match with the Testnet, and that is when Pi will migrate to the final phase.
3. Mainnet – Once the software has been thoroughly tested on the Testnet, the official Mainnet of the network will be launched. In this phase, all the accounts which are unverifiable to individual accounts will be disposed off. So it is imperative to do your KYC on the Pi app as and when it becomes available. An intermediate KYC is available on the app today.
Once the main net is released, Pi can then be listed on crypto exchanges worldwide and can be freely traded between its users. Like Bitcoin and other blockchains, Pi will move to community ownership ensuring there is no individual node that can affect the blockchain and make irregular transactions.
The Team behind Pi
The Pi blockchain was founded by two Stanford Ph.D. graduates. You can learn more about the team here.