Investors are calling for 'burning' some of their Pi Network holdings.

Burning Pi is seen as a short-term solution to save the cryptocurrency from its decline. Image: Created by AI .

After a week of significant volatility, Pi Network has lost over 20% of its value. In response, analysts have offered various suggestions to prevent the cryptocurrency from plummeting further. DrAltcoin, a supporter of the project, suggests the team could boost the price by burning a large amount of Pi Coin.

When the price of the cryptocurrency threatened to fall below $0.40 , DrAltcoin offered solutions to prevent the decline. According to his analysis on the X platform, he believes a sharp correction would make it difficult for Pi to recover.

To prevent further price drops, this investor urged PiCoreTeam to burn the billions of Pi they hold. He emphasized that destroying the cryptocurrency would reduce the circulating supply, making it scarcer and stimulating price increases.

Recent price movements of Pi cryptocurrency. Image: CoinMarketCap.

“A quick fix? PiCoreTeam should burn billions of Pi Coins currently held in over 20,000 wallets of the Pi Foundation,” the analyst stated. From the beginning, the development team controlled over 80 billion Pi distributed across various wallets. Burning the coins could help improve the price. However, pessimism among investors continues to mount after the recent token unlock, causing the price of Pi to fall below $1 .

Canceling a cryptocurrency might have an immediate positive impact, but the project's long-term prospects remain uncertain. "Be patient and hope Pi will be like Bitcoin, rather than ending up like XRP," DrAltcoin wrote on X.

In fact, burning coins/tokens is a very common practice in the cryptocurrency industry. This helps reduce the circulating supply, increasing scarcity and leading to price increases. ETH even has a dedicated wallet address where investors can send coins to "burn." The amount of cryptocurrency removed from circulation is also an indicator used by investors to predict price.

Millions more Pi are unlocked every day. Photo: Piscan.

However, in the case of Pi Network, the issue is much more complex. The 80 billion Pi held by developers is not included in the market capitalization calculations of specialized sites like CoinMarketCap or CoinGecko. Currently, these platforms only record 6.86 billion Pi in circulation, which has already been mined by investors. The 80 billion Pi held by the PiCoreTeam has no plans to unlock in the short term, thus not creating pressure to dilute the market capitalization.

In reality, only a small fraction of the 6.68 billion mined coins are tradable. According to Piscan, approximately 6-8 million Pi are unlocked daily. This is the amount that miners previously froze to speed up mining. It is this volume of coins that creates selling pressure, causing the price of Pi to continuously fall. With the free mining model based solely on daily check-ins, Pi holders are willing to sell without fear of losing money.

On April 14th, Pi was trading around $0.75 per coin, nearly doubling from its low of $0.40 last week. However, it has split three times from its peak of $2.90 at the end of February.

Source: https://znews.vn/nha-dau-tu-keu-goi-dot-bot-pi-network-post1545753.html