What is exciting with Pi Network these days is not much on what is happening within its ecosystem but what is going on outside of it.
Those familiar knows that in the fast three days, Pi has been listed in cryptocurrency exchanges. Although what is being traded actually in xt.com and huobi.com platforms are IOU of Pi, the event have caused confusion if not outright controversy.
What is controversial in this Pi IOU listings is that it was not authorized by the Pi Network Core Team.
Hours later after the crypto exchange listing, the Core Team made the official announcement in their website:
“It is important to reiterate that Pi is currently in the Enclosed Network and is not approved by Pi Network for listing on any exchange or for trading, and Pi Network was not involved with any of these purported postings or listings.
“Currently, Pi Network recommends to all Pioneers and potential Pi users not to engage with any of these exchanges or third party actors as their actions are not affiliated with Pi Network, and could result in substantial loss or damage to Pi users. Pi Network is also requesting these posts and exchange listings removed, and evaluating additional actions with respect to the third parties and exchanges. In the interim, it is important to reiterate that the transaction of Pi through an exchange is explicitly prohibited during the Enclosed Mainnet period, and doing so would be a violation of Pi’s policies.”
Despite this official announcement though, transactions are still going on the said exchanges up to this time. Information is circulating that there are still more firms that will follow to do similar listings.
Pi is now trading at $229, down from its highest price of $323 with a transaction volume valued at $34.27 million. As of January 2, 2023 it is ranked 2600 in the coinmarketcap.com.
What is IOU and how will it affect Pi?
A cryptocurrency IOU (I Owe You) is a promise by one party to pay another party a certain amount of cryptocurrency, and in this case Pi, at a later date. In an IOU trade, one party gives the other party an IOU for a certain amount of cryptocurrency, and the other party pay them a different cryptocurrency or fiat currency in return.
IOU trading can benefit crypto exchanges and trading clients by allowing them to trade cryptocurrencies that they do not currently hold. For example, if a trader wants to buy a certain cryptocurrency but the exchange does not have it available for purchase, the exchange can offer the trader an IOU for that cryptocurrency. This allows the trader to buy the cryptocurrency they want without having to wait for it to be available on the exchange.
There are several risks involved in engaging in IOU trading. One risk is the risk of default, which is the risk that the party issuing the IOU will not fulfill their promise to pay the other party the agreed-upon amount of cryptocurrency. There is also the risk of liquidity, which is the risk that the market for the IOU may be illiquid and it may be difficult to sell the IOU for a fair price. Also, there is the risk of regulatory uncertainty, as the legal status of IOUs and their use in trading cryptocurrencies is not always clear.
So at this setting, how will this unofficial listing affect Pi Network? The answer may depend on the results and outcomes of this IOU transactions, more particularly once Pi will be available during the Open network.
If these platforms delivers what it had promised based on the IOU contracts, meaning it can satisfy the clients orders on a particular volume as earlier executed irrespective of current prices, especially when prices is quite high, this will boost the image of Pi as a promising digital asset. If not, in certain degree this will have unfavorable impact even though transactions were initiated and done by a third party without Pi Network authorization. Most likely it will create doubt as to the overall credibility of Pi even if the Pi Core Team doesn’t have anything to do, and did not grant approval on this IOU listing.
What is clear though is that the Pi IOU transactions that is going on is a reflection of the current reality. That thousands of crypto enthusiasts are excitedly interested, waiting to get hold of real Pi despite that it is still not available yet for cryptocurrency exchange trading while its blockchain is still on an enclosed network phase. Those cryptopreneurs and investors that recognize the potential of Pi Network with its thirty million plus users base distributed in over 230 countries throughout the world.
Moreover, this proves the fact that crypto firms are very eager to have Pi in their platforms. Possibly a welcome scenario that can bring many possibilities for Pi.
The thousands of Pioneers rushing to the websites of exchange platforms listing the Pi IOU indicates their interest to see how Pi will most likely performs during the actual trading of the real Pi coin that will happen comes Open Mainnet launching.
Although it is a known fact that Pi is primarily designed to be a peer to peer digital money that will be used in marketplaces globally by its holders, its listing in cryptocurrency exchanges though not a priority by the Core Team, is one important mechanism for its universal circulation and the build-up of its inherent value.
While parties initiating and participating in the IOU trading in the name of Pi coin may have been enjoying some financial gains much ahead already, still the millions of users of Pi app are still waiting for the Open Mainnet for them to enjoy certain benefits that is forthcoming. This is the ground reality now.
As year 2022 ends, Pi Network is just a little over two months short of its 4th year in existence. The occurence of the events discussed earlier should be a compelling reason for the Pi Core Team to accelerate and fast track the mainnet timeline.
Many awaited events are still in the offing, foremost of which is the launching of the Open network, of which millions of Pioneers throughout the world are now very excited for the fulfillment of their expectations. To be able to use their Pi for consumptive and productive purposes. That eventually for some, Pi will bring significant changes in their financial lives. Particularly those people surviving on their day to day existence.
Such as those in the developing countries of which upliftment of the quality of life for their families is a long time dream. These are the themes on thousands of posts we read in Pi chat rooms and social media platforms every day where Pi community presence is common sight.
I’m a believer of Pi, of its vision and mission as explicitly explained in the white paper. Whatever people had been saying about it, I open my mobile phone daily to mine this valuable digital gem for free.
What I am hoping to see is that Pioneers will be able to use and manage their Pi holdings prudently for it to be able to fulfill their hopes and dreams. And possibly some of them will agree that this task is easier said than done, and a great challenge for individual Pi holders.
There are Pioneers who believe that Pi will be a game changer in the cryptocurrency space. What I hope to see is that it can help transform lives. That it can be an instrument for inclusive growth worldwide…
