Pi Network Coin price continued its strong downward spiral this week, plunging to a record low as the crypto market crash accelerated.
The token has now plunged by over 94% from its all-time high in February last year, a move that may attract bargain hunters. This article explores whether it is safe to buy the Pi Coin dip or sell the rip.
The Case for Buying Pi Network Coin as the Crash Continues
As we wrote in January, there are reasons why the Pi Network token may rebound this year. First, the coin may rebound if the ongoing gloom and doom in the crypto market eases. Historically, most altcoins, including ghost chains, have performed well during crypto market bull runs, and Pi may do the same.
Second, technical analysis suggests that the token has become highly oversold, with the Relative Strength Index (RSI) crashing to the oversold level at 27. Similarly, the two lines of the Stochastic Oscillator have moved to the oversold zone.
Third, there is still a slim chance that one or more crypto exchanges, such as Coinbase, Binance, Upbit, and Kraken, will list the coin, which could increase demand. Such a move would expose Pi Coin to millions of customers globally.
Additionally, Pi Network’s team may address the community’s main concerns, including decentralization, communication, product upgrades, and ecosystem growth.
The Case Against Pi Coin Token
Still, there are signs that the Pi Coin price may continue crashing in the coming weeks. First, the developers have made no effort to address the challenges the community has raised.
For example, the developers have not addressed supply dynamics by announcing token burns, which help reduce the supply. Also, the team has arguably not made any effort to list the token on major exchanges such as Coinbase and Binance.
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At the same time, the token unlocks have accelerated in the past few months. Data compiled by PiScan shows that the network will unlock nearly 200 million tokens this month and 1.29 billion over the next 12 months.
Pi Network demand has waned over time, with the 24-hour volume being $20 million, a tiny amount for a cryptocurrency with over $1.4 billion. It is one of the least traded tokens in the crypto industry.
Meanwhile, Pi Network does not have demand from whale investors. Data show there are only 20 whales, a figure that has continued to decline over the past few weeks.
The biggest whale has not made any purchase in the past 20 days, and there are signs that he has started to exit. The whale moved tokens worth over $1.35 million on Monday and $1.38 million last week. This could be a sign that the whale is starting to capitulate.
Pi Network is also highly centralized, with the team holding billions of tokens, which is risky for the long-term existence of the token.
Summary
Pi Network price has crashed by over 90% from its highest level in February last year. This trend will likely continue falling in the coming months because its risks outweigh its potential rewards.
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