Pi Network has responded to recent accusations labeling the project as a scam and a multi-level marketing (MLM) scheme. A spokesperson for the company stated that these claims are false and based on misunderstandings of how the project and its referral system actually work.
Allegations Sparked by Industry Leaders
The controversy began when Bybit CEO Ben Zhou publicly called Pi Network a scam and stated that Bybit would not list the PI token. Soon after, Cyber Capital’s founder Justin Bons echoed this sentiment, calling the project a “multi-level marketing type scheme” due to its referral system.
These comments have had a negative impact on Pi’s public image and its token value. After the mainnet launch on February 20, the price of PI reached a peak of $2.99 but has since dropped to around $0.82, according to data from CoinGecko.
Pi Network Rejects MLM Label
Pi Network strongly denies that its referral program fits the definition of a multi-level marketing model. In a statement, the company explained that there are no financial costs involved in joining the network or participating in the referral system—users can mine PI tokens for free using a mobile app.
The key point Pi Network emphasizes is that its referral program is only one level deep. If Person A refers Person B, only those two benefit from each other’s activity. If Person B refers Person C, Person A does not receive any bonus or benefit from C’s participation. This, the company says, clearly separates their model from traditional MLM structures, where commissions can trickle down across multiple levels.
The referral bonus offered by Pi Network gives a 25% mining reward boost to both the person referring and the one being referred—but only when both are actively mining at the same time. Pi describes this as a simple incentive to encourage user growth and participation, similar to referral programs used by many tech and finance companies.
Clarifying the Bybit Situation
In response to the specific claims made by Bybit’s CEO, Pi Network clarified that it never contacted Bybit about a token listing. The company pointed to a two-year-old post warning that unauthorized actors had been impersonating Pi Network to approach exchanges.