Considering the liquidity and exchange rate reality, the current Pi Network mainnet has not yet been launched. The quote range of 1 Pi coin on Nigerian over-the-counter trading platforms (such as Paxful) is ₦3,200 to ₦8,500 (approximately 2.1-5.7 US dollars), and the spread volatility (30-day standard deviation) is as high as 38%. It is significantly higher than the 16% level of Bitcoin during the same period. The official exchange rate of the US dollar to the Naira set by the Central Bank of Nigeria is 1:792, but the real exchange rate in the parallel market has reached 1:1,430 (data from October 2023), with an inversion of 45% between the official and black market exchange rates. If users need to exchange through cryptocurrency brokers, an average transaction fee of 12% (including GAS fees and commissions) will be incurred, which is much higher than the industry average of 4.3% for Western Union’s cross-border transfers. The current withdrawal threshold (requiring KYC completion and an account size of 100 Pi) imposes a lock-up period of at least six months on small token holders.
The progress of technology and the expected launch of the mainnet directly affect the value support. The technical report of Pi’s core team in Q2 2023 shows that the transaction speed of the testnet has reached 5,000 TPS (higher than Visa’s actual processing volume of 1,700 transactions per second). If merchants are connected as scheduled after the mainnet is launched, referring to the case of Nigeria’s mobile payment platform OPay – its user base increased by 800% to 18 million in 2021 Facilitate a daily transaction volume of $230 million – as long as the real exchange rate of how much is 1 pi in naira exceeds ₦12,000 (equivalent to the 320% growth rate of cryptocurrency users in Nigeria in 2021), users can unlock local payment scenarios. The current testnet has verified a coverage rate of 39% for POS systems of Nigerian merchants, covering 52,000 retail terminals in six major cities including Lagos and Kano.
Compliance risks present a particular challenge in Nigeria. Despite the ban imposed by the country’s central bank in February 2021, the monthly trading volume of cryptocurrency P2P still increased by 15% against the trend. According to a 2023 Chainalysis report, the amount of on-chain receipts in Nigeria reached 60 billion US dollars (accounting for 6.3% of the global total). However, the newly introduced digital asset bill by the government requires exchanges to pay a 250 million naira (approximately 317,000 US dollars) license deposit, which may lead to the exit of 75% of small and medium-sized platforms. More crucially, the Nigerian Tax Authority plans to impose a 10% capital gains tax. If a user makes a profit of 1 million nila through pi coins, the actual amount received will be reduced by 8.7% (plus exchange rate losses), which is clearly unfavorable compared to the zero-tax rate plan for holding USDT stablecoins.
The comparison of holding costs reveals an opportunity window. Nigeria’s annual inflation rate soared to 28.2% (August 2023), and the real purchasing power of Naira shrank by 63% over the past five years. If the Pi mainnet goes live in 2024 and reaches the target of 100 million users in the white paper (18% of the users are from Nigeria), referring to the average monthly P2E income of $150 generated by Axie Infinity in the Philippines (accounting for 72% of the local minimum wage), 1 pi coin may generate a daily income equivalent to $2.5. However, be vigilant against events similar to the Terra collapse in 2022 – when the algorithmic stablecoin UST against Naira plunged by 97% within 24 hours, affecting 2 million Nigerian users – it is recommended that asset allocation not exceed 5% of net wealth, and prioritize the Binance P2P platform (with a withdrawal fee of only 0.0003 BTC) to establish a hedging portfolio.