image source: coingape.com
In recent years, the world of cryptocurrency has expanded beyond Bitcoin with new projects aiming to make digital currencies more accessible to the masses. One such project is the PI Network, a mobile-based cryptocurrency mining platform that has gained significant attention globally, including in Nepal. This blog explores what Pi Network is, how it works.
What is Cryptocurrency?
Cryptocurrency is a type of digital or virtual currency that uses cryptography for security. Unlike traditional currencies issued by governments (like Rupees, US Dollar, Euro etc), cryptocurrencies operate on decentralized networks based on blockchain technology. this decentralization means that no single entity, such as a bank or government controls the currency. Instead, transactions are verified and recorded by a distributed network of computers. It can be accessed and used by anyone with an internet connection, making them particularly useful for cross-border transactions. Popular Cryptocurrencies are Bitcoin, Ethereum, Binance Coin, Cardano etc.
What is Pi Network?
Pi Network is a cryptocurrency project founded by a team of Stanford graduates in 2019. Unlike traditional cryptocurrencies like Bitcoin, which require expensive hardware and high energy consumption for mining, Pi Network allows users to mine its native cryptocurrency, Pi Coin, directly from their smartphones. The project aims to create a decentralized and inclusive digital currency that can be accessed by everyday, even those without technical expertise.
The Pi Network app is free to download and use, and it operates on a consensus algorithm called the Stellar Consensus Protocol (SCP), which is more energy-efficient than Bitcoin’s Proof-of-Work (PoW) system. Users can mine Pi Coin by simply opening the app once a day and clicking a button to verify their presence.
How Does Pi Network Work?
1. Mining Pi Coin: Users can mine Pi Coin by logging into the app daily. The mining rate depends on factors like user engagement and the size of their referral network. Early adopters have a higher mining rate, incentivizing users to join early and invite others.
2. Security Circle: To prevent fake accounts and ensure decentralization, Pi Network uses a "Security Circle" system where users vouch for each other’s authenticity. This builds trust within the network.
3. KYC Verification: To ensure compliance and prevent fraud, Pi Network requires users to complete a Know Your Customer (KYC) process before they can withdraw or transfer Pi Coins.
4. Mainnet Launch: Pi Network is still in its development phase, operating on a testnet. The transition to the mainnet, where Pi Coin will become a fully functional cryptocurrency, is highly anticipated. (mainnet : it refers to fully operational blockchain network that is ready for public/ final product of blockchain)
Pi Network in Nepal
Nepal, with its growing internet penetration and smartphone usage, has seen a surge in interest in digital currencies and blockchain technology. Pi Network has gained popularity among Nepali users due to its simplicity and low barrier to entry.
Nepal’s regulatory stance on cryptocurrencies is unclear. The Nepal Rastra Bank (NRB) has previously banned cryptocurrency transactions, which could pose a risk to Pi Network users.
Disclaimer: This blog is for informational purposes only and does not constitute financial advice neither advice to involve in any cryptocurrency activities. Cryptocurrencies are highly volatile and speculative as well as it is illegal in Nepal.
Comments
Post a Comment