Pi Network will release Protocol v25 on 22 Jul, introducing network-stability improvements alongside BN254 cryptography and Poseidon hashing. These tools support zero-knowledge applications, allowing users to prove information without revealing the underlying data, including identity or eligibility checks. For Pi, however, the upgrade also needs to show that a project best known for viral mobile "mining" can ship credible blockchain infrastructure.
Pi Network's v25 Upgrade Tests Its Technology, Credibility
21 July 2026 - 19:00 CEST
What Pi actually is
Pi is a mobile-first Layer-1 network built around distributing its PI token to a large, identity-verified user base. Users "mine" by opening the app and tapping a button once every 24 hours to confirm that they remain active. They can increase their earning rate by inviting users, interacting with applications and creating "security circles" of three to five trusted members.
The word mining deserves scrutiny. A phone running Pi is not solving cryptographic puzzles, validating transactions or contributing meaningful computing power. Consensus is performed by desktop nodes using a system derived from the Stellar Consensus Protocol. The daily tap is therefore better understood as a token-accrual and engagement mechanism than mining in the Bitcoin sense.
Pi's referral structure also invites criticism. Users join through an existing member, while inviters earn more when referrals remain active. That resembles the growth mechanics used by multi-level marketing and pyramid-style schemes, although Pi is not a classic pyramid: users do not pay to join, and rewards are not built around an endless hierarchy of paid recruits. Still, the model is optimized for viral acquisition, while its terminology overstates the technical contribution of ordinary users.
Mandatory identity verification creates another tension. Users must complete Know Your Customer checks before earned balances can migrate to Mainnet and become usable. This limits bots and supports Pi's "one person, one account" goal, but moves the network away from the permissionless and pseudonymous ideals associated with Web3. Pi is not an anonymous monetary network. It is a managed, identity-based distribution system.
A real upgrade, but not yet real demand
That does not make Pi a fake project. It has a functioning blockchain, transferable tokens, desktop consensus nodes, wallets, applications and external connectivity. Protocol v25 is further evidence that the team is developing real infrastructure. Zero-knowledge tools could let users prove identity, age, location or eligibility without exposing all their personal information. But enabling technology is not adoption. V25 does not immediately create fee demand, change token emissions or guarantee useful applications. The market appears to understand that distinction.
In the five days after the 15 Jul announcement, average futures volume rose to $40.99mn from $27.61mn during the preceding five days, a 48% increase. Average spot volume rose a smaller 23%, from $10.96mn to $13.50mn. The futures-to-spot volume ratio increased from 2.52 to 3.04. Attention rose, but derivatives traders responded more aggressively than spot buyers.
Chart
Source: Coinmetrics
Open interest jumped 34% on 15 Jul, from $9.12mn to $12.18mn, while funding fell to an annualized -82%. That combination shows traders initially approached the upgrade defensively, adding leverage with a pronounced bearish bias. As PI held up, those shorts were forced to unwind, pushing funding back to roughly +10% by 20 Jul. Positioning is therefore mildly bullish heading into v25, but not strongly so: open interest has already fallen 12% from its announcement-day peak, suggesting traders are reducing exposure rather than aggressively front-running a fundamental repricing.
Serious enough to study, not yet strong enough to trust
Pi's technology is becoming harder to dismiss, but its investment case remains weakly evidenced. Referral-driven acquisition, misleading mining language, mandatory KYC, administered allocations, low circulating supply relative to maximum supply and uncertain future issuance reduce its credibility against mature permissionless networks. More importantly, Pi has yet to prove that its enormous community wants to transact, build and pay rather than simply collect tokens.
Protocol v25 is a constructive technical milestone. The real test begins afterward: whether developers use the new cryptography, whether applications generate persistent activity and whether market interest shifts towards durable spot demand. Until then, Pi is best understood as a heavily managed crypto distribution experiment, not a grassroots decentralized mining network.
