At this point, it’s absolutely clear that the world is becoming more and more digitalized.

So, cryptocurrencies are a natural next step for our progression as a civilization.

Pi is the first digital money that you can “mine” directly on your smartphone.

The team behind this project are people graduated from Stanford. And they are actually making a real step toward the mass adoption of cryptocurrency all around the world.

Distributed ledgers…

Let’s take a look at distributed ledgers for a moment.

Bitcoin, of course, was the first network to achieve the implementation of this feature, which we call blockchain.

Basically, it’s a public record of transactions, which is maintained by validators who have access to that public ledger and who are constantly updating it. Thus, they validate that all that is happening on the network is authentic.

The actual breakthrough with blockchain technology is that it allows people to maintain all the information, and to reach consensus for the truthfulness of transactions, without having to rely on centralized intermediaries like banks (who are taking a serious portion of every single transaction that’s been executed).

Also, banks and governments no longer have the ability to censor or seize any of our money.

The catch here is that everybody is responsible for their own funds, which is possible because of a feature we know as a private key.

So, in order to protect your funds from hackers and thieves, you have to keep your private keys safe. Plus, you need to realize that nobody will be able to help you recover your money if you lose access to these keys.

Problem…

First, the current state of mining cryptocurrencies demands an excessive amount of computing power, and it’s consuming a lot of energy. Thus, validators actually have to be paying first, in order to be able to get any rewards for their work.

Plus, the times when you could use your personal computer for this purpose are long gone. And you must have a specialized tool, called ASIC, so you stand a chance for making any profits.

Second, as mining farms began to appear, it became very difficult for regular users to make any money using only one or two mining tools. And the reason is simple, you now have to compete with thousands and thousands of powerful chips, all mining simultaneously.

Solution…

What the team behind Pi is trying to do is to give the opportunity to everyday people to earn cryptocurrency.

So, they employ a consensus algorithm, which enables mining on personal computers, laptops, and mobile phones.

Their software is user-friendly too, so every single person can handle it.

Consensus algorithms…

There are two widespread types of consensus algorithms right now.

The first type elects a single node as a leader. That means, that the first node who is lucky to solve the riddle (which is mining in essence), is determined to produce the next block on the blockchain. Therefore, only one computer gets the whole reward for the block.

The second type operates without a leader, and all the nodes come to a consensus of what the next block will look like. That’s done by exchanging messages between all the computers on the given chain. So, everybody gets a reward.

However, Pi uses another type of consensus algorithm, which builds on top of the Stellar Consensus Protocol and the Federated Byzantine Agreement algorithm.

Rewards…

A very appealing property of Pi’s core protocol is that it coordinates consensus between a distributed system of nodes. That means it can be used to record new transactions in the blocks every few seconds, and also to make more complex computations than other algorithms.

(For example, computing the daily Pi coins distribution across all the users who were active during the day.)

The advantage of this is that the rewards are computed only once a day, and not on every single block, like it’s happening on other blockchains.

So, the rewards are accumulated in a temporary wallet during the day.

This wallet has an unknown private key, and it automatically distributes rewards to all the users who have participated in that day. And this whole activity is forced by the protocol itself, under the consensus of all of the nodes.

Pi’s model…

The team is seeking to accomplish a balance between a sense of scarcity and assurance that a large amount of coins isn’t accumulated by only a small number of people.

They want to make sure that users will earn Pi in correspondence with their contributions to the network.

Hence, to build an economic model that is practical enough, while the app remains easy for people to use.

Pi coin’s maximum supply will be equal to the total mining rewards + total referral rewards + total developer rewards. And its value will be supported by a basket of goods and services, which will be growing over time.

They are also considering the implementation of a marketplace into the application, so users will be able to offer their skills or services directly on the platform.

For example, they could offer programming, design, copywriting, or whatever other skill they have to other people on the network. They could also offer a place, which they are giving for rent, or sell a product that they are creating.

Plus, when a broader ecosystem takes place, people will be able to build decentralized apps on top of Pi, leveraging the already framed infrastructure and shared resources.

Types of users…

There are four functions Pi users can perform.

For every one of them, they get daily rewards, proportional to their contribution to the network.

Pioneer is a user of the mobile app, who is simply confirming they are not a robot every 24 hours

is a user of the mobile app, who is simply confirming they are not a robot every 24 hours Contributor is a user of the mobile app, who is providing a list of pioneers, who they know and who they trust

is a user of the mobile app, who is providing a list of pioneers, who they know and who they trust Ambassador is a user of the mobile app, who is inviting new people to the Pi network

is a user of the mobile app, who is inviting new people to the Pi network Node is a user who is a pioneer and a contributor, and who also is running the node software on their computer

Pi’s node software is still in development but it’s coming soon. It will run the core algorithm and will take into account the trust graph information provided by the contributors of the network

The good news is that a user can play more than one role at a time.

Final words…

As the team claims, Pi makes crypto mining easy.

It utilizes a breakthrough tech, which allows you to mine on your computer, on your laptop, or on your phone.

It doesn’t affect your device’s performance, drain your battery, or use your network data.

It’s secure, immutable and interoperable digital money, but most importantly, the app is super easy to use.

It doesn’t require KYC to mine, and you don’t even need to leave the app open.

All you have to do is check-in every 24 hours, for which you’ll get a simple notification. Then you hit a little “lightning” button and that’s it, you’re now mining.

Once you are a user, you can boost your hourly earn rate by inviting your friends to join.

Keep in mind, earlier members of the network mine at a higher rate than those that come later.

If you decide to download this dApp, put my invitation code when you’re registering, so we can connect and mine more Pi together. [ivankrwrites]

For more information about the Pi project, visit their FAQ page or Whitepaper.

Follow me on Twitter.