Pi Network (PI) Price Prediction: Stretched Valuation May Lead to a Crash Ahead of Ecosystem News

The Pi Network price has seen significant volatility in recent weeks, currently trading at $0.7796. While the token is up 6% in the last 24 hours

The price of Pi Network (PI) has shown signs of volatility in recent times, currently trading at $0.7796. While the token has seen a 6% surge in the past 24 hours, it’s still down 38% over the last seven days and over 70% from its all-time high of $2.99, which was reached in February.

As reported by AMB Crypto, there has been a slight increase in trading volume to more than $221 million in the past 24 hours, indicating renewed interest in the market despite the overall downtrend.

The recent price crash began after May 12, when Pi Network surged to $1.6631 ahead of ecosystem news. Since then, the price has dropped below several key technical indicators.

Analysis of the daily chart presents mixed signals. The relative strength index is approaching the 51 level, which suggests a neutral trend. The 20- and 30-day moving averages have turned positive, indicating that some buying strength is returning.

However, short-term indicators like the 10-day EMA and SMA continue to present sell signals. At present, support appears to be forming around $0.77, and resistance is at $0.84, which needs to be breached for a stronger recovery.

Technical Analysis: Bearish Pennant Could Send Pi Down 45%

Technical analysis of the eight-hour chart reveals a concerning pattern forming in the price of Pi Network. The cryptocurrency is forming what appears to be a bearish pennant pattern.

This pattern is characterized by a flagpole-like vertical line, followed by a triangular consolidation pattern. The pennant is typically observed after a sharp decline in price, presenting a final drop before a rebound.

In the case of Pi Network, the pennant pattern follows a decline of nearly 70% from the highs of around $2.56 to lows of $0.77.

If this bearish pattern completes with a downward breakout, it could push Pi’s price to a support level of $0.5580. This level corresponds to the previous lows reached on April 9 and April 30.

Failure to hold this support could result in further decline toward $0.40, rendering a 45% drop from current prices.

However, this bearish forecast could be invalidated if Pi manages to rise above the psychological resistance of $1.

Centralization Concerns As Pi Foundation Holds Billions In Tokens

One of the main hurdles for Pi Network is its centralized structure. According to reports, the Pi Foundation holds at least 72.7 billion tokens, currently valued at over $53 billion, in seven wallets, in addition to more tokens in thousands of other wallets.

This high level of centralization poses risks for token holders, as these wallets have not been subject to audits. If the foundation decides to sell these tokens or hackers gain access to the wallets, it could lead to a dramatic crash in the token’s price.

Moreover, the centralized nature of Pi Network poses a challenge for obtaining listings on major exchanges like Binance and Upbit. Most top-tier exchanges are typically reluctant to list cryptocurrency projects with such concentrated token distribution.

Chart Analysis: Pi Network Faces Token Unlocks And Ecosystem Growth Challenges

An analysis of Pi Network’s tokenomics reveals another challenge that could hamper price gains.

Data shows that the network will unlock 271.18 million tokens over the next 30 days, with a daily average exceeding 9 million tokens.

Looking further ahead, 1.49 billion tokens will be unlocked over the next 12 months. Considering that Pi has a maximum supply of 100 billion and a current circulating supply of 7.9 billion, the supply will grow by over 92 billion tokens over time.

These continuous unlocks increase the available supply, which can exert downward pressure on prices, especially if it’s not met with a corresponding rise in demand.

Furthermore, Pi Network has faced criticism as a potential “ghost chain,” with few developers actively building applications on its platform. Although the mainnet launched with 100 apps, most of them have failed to gain significant user traction.

The $100 million Pi Network Ventures fund was established to support the growth of its ecosystem. However, despite this initiative, there hasn’t been much progress to report yet.

Without strong applications driving usage, the Pi Network token primarily serves as a subject of speculation rather than having intrinsic utility.

Many users have also encountered difficulties accessing their coins since the February mainnet launch due to ongoing Know Your Customer (KYC) delays. This has frustrated early miners who anticipated being able to freely use or trade their tokens.

Finally, Pi Network’s absence from major exchanges like Coinbase and Binance has limited its liquidity and wider adoption. While the token is traded on