PI Network and the MLM model

They get you to log in each day, and invite others to ‘level up’

In the digital marketing world, it’s important to understand that building an audience takes time. One of the most effective ways to gain more users on a platform is by using a marketing technique known as level up. In this process, you invite one or more new users to your platform and offer them some incentives in exchange for their participation. This makes them gain more digital currency per day.

Pi uses the same methods as the MLM The Pyramid Schemes are always in search of new prospects. But the more people you have on your platform, the more money you can earn. With this, Pyramid Schemes are also referred to as Multi-level marketing or MLM.

This is a common model in pyramid schemes and Multi level marketing. The goal of this type of marketing is to recruit users who are willing to pay for the service, so that they can rise up the pyramid and earn more digital currency. This means that there are various incentives for users to make referrals, such as bonus points for referring people, which could be used to buy higher tiers of membership. But PI does this without the financial incentive but the methods are the same

Users are encouraged to log in everyday, for no tangible benefits as of yet, other than PI gaining market data on the users.

The app itself has no practical use, and is extremely basic with the ability to just send messages.

The idea that this is ‘mining’ is totally wrong

The PI app is an app that promises rewards for bringing in new users. It works as a direct selling or affiliate marketing system where users can sign up and earn points for referring their friends.

Is PI Network a Scam Pyramid Scheme?

Multi-level marketing is an economic strategy that recruits people into a pyramid structure to sell goods or services. The idea behind the practice is to sell the product directly to the customer, who in turn can make money by recruiting others in turn. The Pi app is similar in many ways since it’s an algorithm that mines coins for its users. It increases supposed benefits by providing benefits earlier to early users who started earlier.

Multi Level Marketing or MLM is a type of business which is commonly known as network marketing. It includes direct selling and provides increased potential benefits to early users (i.e. earlier users mine at an increased rate).

With this pointed out the similarity between PI and a MLM become more clear.

But no money is taken how is PI a scam?

The answer is obvious, they take time and customer data, which in turn equals money. Ad revenue is another income stream for the app which by now it should be obvious they are making a lot of money. But the ‘mined’ pi as of yet has no value.

A blockchain scam without blockchain infrastructure, OneCoin, relied on the McKinsey experience and education of its founder in it. It is evident they are relying on their creator to generate wealth rather than creating a system that is decentralized and secure. We have found that PI are doing the same, by heavily promoting the education of the creators. We find that many successful businesses that needed to market the owners education so heavily have never done well, compared to a Jeff Bezos, Jobs, etc, who put the product at the forefront. While of course a Stanford education is not a bad thing at all.

Founders are already seeing great benefits from their app. They launched optional video ads at launch to monetize the active user base. These video ads are an effective way to leverage the app and make it a revenue driver.

The app also has a KYC process of collecting passport information. Having a verified audience through a KYC process would increase advertising revenues.

Will Pi be valuable in the future

It could of course, no one can predict the future. We are only pointing out some issues we have, we could be wrong. The Pi network owners certainly know how to market, and leverage the app to make a lot of money, so could use this business acumen to make pi valuable, yes they could.

The team behind Pi Stack, a blockchain, have released their whitepaper which outlines their ambitions for the project. But a closer look, will show you the paper lacks any real details on how they can achieve their plans.

We don’t know when the mainnet will be released. There is no timeline for this decision to be made, so we will not know until we see it happen.

Will Pi make you rich

We think its unlikely to make any consumers of the app rich, we really wonder why they have not launched the blockchain and the exchange, much smaller/tiny companies have done this, its not at all a hard thing to do engineering wise.

So why haven’t they done something as simple as that?

It could be firstly they are worried that when they do list it, everyone will dump the coin in a sell off, damaging the companies reputation. And so at the moment they are happy enough to grow the app to hundreds of thousands more users and take in the ad revenue that it brings.

So in conclusion, do not bother wasting your time with this app.

And if you have the app and will continue to, then I hope you prove us wrong, who knows!