Preface

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Pi Network is an innovative platform designed to allow ordinary people to easily participate in the world of cryptocurrency. Unlike traditional cryptocurrency mining methods, Pi Network allows users to mine through mobile devices without the need for high-power hardware devices. This article will delve into the operation principles of Pi Network, including its consensus mechanism, role division, mining process, and future development direction.

Pi Network’s consensus mechanism

Pi Network uses the Stellar Consensus Protocol (SCP) as its consensus mechanism. SCP, designed by Stanford University professor David Mazières, is a consensus algorithm aimed at ensuring transaction security while improving transaction processing speed. Unlike the proof-of-work (PoW) or proof-of-stake (PoS) mechanisms of Bitcoin or Ethereum, SCP allows nodes to reach consensus without requiring significant computational resources.

In Pi Network, the implementation of SCP includes the establishment of “Security Circles”, which is a network composed of user trust relationships. Each user can add other users they trust to their own Security Circle, and these intertwined Security Circles collectively build the trust foundation of the entire network, thereby ensuring the authenticity and security of transactions.

Role Division in Pi Network

In the Pi Network ecosystem, participants are divided into four types of roles:

• Pioneer: This is the most basic role, referring to users who prove their activity by clicking the “mining” button on their mobile devices every day. Pioneers are the main participants of the Pi Network, and their behavior directly affects the production of Pi coins.
• Contributor: After becoming a pioneer, users can further become contributors, who need to establish their own secure circle, add trusted users to improve the network’s security.
• Ambassador: The main duty of an ambassador is to promote the Pi Network, invite new users to join, and whenever a new user registers and starts mining with the ambassador’s invitation code, the ambassador can receive corresponding rewards.
• Node: A node refers to a user running Pi Network node software on a computer, these nodes are responsible for validating transactions and maintaining the integrity of the blockchain, and working in conjunction with applications on mobile devices.

The four roles collaborate with each other to jointly maintain and develop the Pi Network ecosystem.

The mining process of Pi Network

The mining process of Pi Network is different from traditional cryptocurrency mining. Users do not need to buy expensive hardware equipment or consume a large amount of electricity. They only need to follow the steps below to participate:

• Daily Check-In: Users need to open the Pi Network app every 24 hours, click the “mining” button to prove their activity. This process does not consume a lot of resources and will not drain the phone battery.
• Establish Security Circle: Users who want to become contributors need to add trusted friends or family members to their security circle. Each security circle needs at least 3 to 5 members, which helps to enhance the overall security of the network.
• Inviting New Users: As an ambassador, users can invite new users to join the Pi Network by sharing invitation codes. Whenever a new user successfully registers and starts mining, the inviter can receive additional mining rewards.

It is important to note that the mining rate of Pi Network will gradually decrease as the number of users in the network increases to control the total supply of Pi coins, so early users can obtain Pi coins at a higher rate.

The transaction fee mechanism of Pi Network

In Pi Network, transaction fees are optional. When there are not many unconfirmed transactions in the network, users can choose to pay lower fees or even transact for free. When there is a backlog of unconfirmed transactions, nodes will prioritize transactions based on the fee amount, processing higher fee transactions first. All transaction fees for the day are pooled into a temporary wallet and distributed proportionally to the stable miners on the network at the end of the day, while the active mining mechanism is also in operation.

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Summary

This article delves into the operation principles of Pi Network, including its unique consensus mechanism, role allocation, mining process, and transaction fee mechanism. As an innovative platform aimed at lowering the barrier to entry for cryptocurrencies, Pi Network adopts the Stellar Consensus Protocol (SCP) and establishes a secure circle to ensure transaction security and processing speed, while avoiding the high power consumption devices required by traditional mining. As Pi Network continues to develop, its low threshold and innovative design are expected to attract more users to enter the cryptocurrency field and propel it towards complete decentralization.