On the centralization of Pi Network
I’m back! Yesterday, I discussed the network effect—how a network becomes more valuable as it grows—and why it’s crucial for Pi Network. Today, I want to talk about centralization: why Pi Network started out centralized, what the goal is, and whether full decentralization is necessary or not.
TL;DR: Pi Network is centralized—for now. The core team made this choice to control the supply while they build utility. Some of the network’s existing utility relies on this centralization. I disagree with the idea that full decentralization is necessary from the start. Transitioning from a centralized system to a decentralized one takes time, and some level of control is needed in the early stages to keep things stable.
Why Centralization?
The centralization of Pi Network has sparked debate. Many worry that it gives the core team too much control over how we use our coins. After all, cryptocurrency is supposed to be decentralized—so why did Pi Network choose this path?
The answer: to ensure fair distribution and prevent early hoarding. Cryptocurrencies often become centralized over time as early adopters accumulate large amounts. Bitcoin, for example, is now dominated by a few major players like BlackRock (400K BTC) and MicroStrategy’s Michael Saylor (500K BTC). This makes it nearly impossible for the average person to participate meaningfully.
By controlling the flow of coins, Pi Network aims to avoid this problem. Limiting supply in the early stages prevents people from exploiting the system before real utility is established.
The Role of Verification
Another key reason for centralization is user verification. In a world increasingly dominated by AI and bots, ensuring that real humans participate in the network adds tangible value. Decentralized systems often lack protection against bot-driven accumulation, making them vulnerable to manipulation. KYC (Know Your Customer) verification helps safeguard the network against such threats.
The Path Forward
The core team’s approach is designed to protect the network and create a fairer distribution system before moving toward decentralization. While full decentralization is the end goal, doing it too soon could lead to the same problems that plague other cryptocurrencies.
That said, the community needs more transparency. Since the network is centralized for now, the core team must communicate more clearly about what they’re doing—even if they don’t explain every decision in detail.
In short: centralization was a strategic choice to ensure fairer distribution, security, and long-term sustainability. The key now is making sure the transition to decentralization happens in a way that benefits everyone.