Barter Madness as Pi Network Closed Mainnet Launches
After over 3 years of faithfully mining and hoping, Pi Network pioneers are finally getting to enjoy the fruits of their labor. This comes with the recent launch of the Pi Network Closed Mainnet. In this current stage of the main network, KYCed holders of the Pi Coin can perform peer-peer transfers strictly for barter purposes (payment for goods or services rendered).
Interestingly enough, this barter stage has taken off in a fashion that resembles the launch of Bitcoin over a decade ago. Shortly after launching, an erratic pricing regime emerged. Some pioneers were seen spending the Pi Coins at a laughable value of 1𝜋 ≈ US $1. For instance, the Philippines pizza purchase that was reported by Pi Network News’ page on Twitter.
In Suwon, another transaction was reported with a much higher value of 1𝜋 ≈ US $76. This one was at a Java retail store for a pair of shoes. Earlier that day, other high-consensus transactions featured on the Pi Blockchain. Pioneers exchanged their coins for a wide range of barter products. Of note were airtime credit, watches, and even used pairs of Airforce 1 Sneakers at a Pi Coin value of 1𝜋 ≈ US $314 159!
Key Takeaways – Understanding Pi Barter
Given this erratic pricing stemming from differing consensus values, a lot of pioneers, myself included, have become hesitant to spend their Pi Coins. Naturally, the desire is to spend one’s coins where the highest value exists. However, the reality at this point is that not everyone has access to these high-value merchants. So, should we therefore panic and concede to any low consensus value offered? Absolutely not, and here’s why;
1. It’s just the beginning, a good one too!
Remember how we likened the launch of the Pi Network Mainnet to the launch of Bitcoin? Well, the similarities are hard to deny! Bitcoin kicked off with the famous purchase of two Papa John’s pizzas. These were valued at approximately US $30 in May 2010, only a few weeks after the coin launched. The ‘pioneer’ Laszlo Hanyecz paid a whopping 10,000 Bitcoins which translated to a meager value of 0.3 US CENTS per coin. Those coins are now valued at over US $30 000!
As much as we may laugh at this pioneer’s folly, this transaction was very detrimental in triggering the utility value of Bitcoin. It ignited faith in Bitcoin. Everyone quickly realized that they could actually attach a real-time value to it and spend it similarly to fiat currency.
2. The Willing Buyer – Willing Seller policy applies to Barter!
Frankly speaking, it’s very wrong to mock any pioneer who chooses to accept or decline a particular consensus value at this point. As much as we may desire to attach a higher value to the Pi Coin, the actual value is still subjective to every individual’s opinion. If you like the value offered, then go ahead and spend. If not, kindly decline. It’s that simple.
Indeed, a tendency to attach a higher Pi Coin value by pioneers would be beneficial. However, remember that the coins at this point are limited. As such, this limited ability to spend will cause a rise in Pi Coin value as per supply and demand norms. Such an approach is definitely better than just leaving it to pioneers to decide the price of the coin. (Kudos to the Core Team on this!)
3. No Barter = No Pi Coin Utility
Consider this; we can only talk of Pi Coin value IF there is an actual exchange of the coins for goods or services happening, regardless of the price! At this point, we should be happy that people are willing to accept PI Coins in exchange for products. Even if the exchange value is pegged at 1 cent, the exchange itself is far more valuable. Why? Well, simply put, barter exchange creates value for Pi Coins in the long run!
Hold on, the best is yet to come!
There’s no doubt that we’re already headed in the right direction. There’s a staggering amount of serious enterprises already eager to participate in the Pi Coin ecology by accepting Pi payments. These include well-established multi-million corporations like Far Chau (@FARCHAUINT on Twitter). Also, innovative startups like Pi Taxi (@taxi_pi on Twitter) are already creating utility for Pi way before open Mainnet. That alone is sufficient to drive the price of Pi to unimaginable highs, perhaps even higher than the generally desired US $314 159.
My advice? Hold on to your Pi Coins – literally! Pretty soon we’ll be referencing the Philippines pizza purchase as the 2nd folly of the century after the Papa John’s pizza purchase – a mere case of history repeating itself. However, we’ll also be thanking the pioneer that initiated that barter transaction. He has effectively kick-started the era of the Pi Coin!