The conversations around Pi Network have been heating up after reports of a $10 million lawsuit filed by an Arizona investor in the United States came up. The case has unearthed long-standing doubts among users who have spent years mining PI but still face limits on how they can access or move their tokens.
There’s also some frustration building up around unresolved KYC reviews, as well as delayed mainnet migrations and restrictions on transfers. Many have complained about completing verification months ago, yet they’re still stuck in “tentative approval” status. Others are reporting issues with accessing their wallets or missing balances during migration.
Questions about PI coin legitimacy are also starting to increase as users wait for features tied to the open mainnet. These concerns shape the larger discussion around risk, transparency, and the future of the project. This article reviews the verified facts behind the Pi Network lawsuit. We’ll look into how the project responds and its current structure.
Pi Network’s $10M Lawsuit Explained
The lawsuit at the center of the controversy was filed by Harro Moen, an Arizona-based investor, in late 2025. The case names SocialChain Inc., Pi Network’s parent company, along with key company executives. The filing accused the company of fraud, unauthorized token transfers, and misleading representations.
According to the complaint, Moen’s claims state that roughly 5,137 PI tokens disappeared from his wallet in April 2024. He also alleges that 1,403 additional tokens never completed migration. Based on prices that appeared on some IOU listings, he estimates total losses exceeding $2 million. The lawsuit further alleges undisclosed insider token sales totaling two billion PI and centralized control through a small number of validator nodes.
PI Network responded with a formal rebuttal in December 2025, describing the claims as “deeply flawed.” They denied any unlawful token sales and stated that PI never traded at the price levels referenced in the lawsuit. They note that IOU prices across exchanges never sustained values near the figures cited in the complaint.
Currently, the case is still ongoing, and no official judgment has been made yet.
Lawsuit Timeline
| Duration | Event | Status |
| Dec 2025 | $10M lawsuit filed | Ongoing |
| Dec 2025 | Pi Network rebuttal released | Court Pending |
KYC delays and supply unlock schedules play a role in shaping public narratives around the lawsuit. Limited access to tokens makes valuation disputes more visible. These issues also appear in broader market discussions covered in the analysis on how PI token unlocks could move price, which explains how restricted liquidity affects Pi coin price discovery.
Legitimacy Review: Scam Red Flags vs Real Weaknesses
Legitimate Strengths
Pi Network built a real infrastructure that sets it apart from typical crypto scams. Over 10 million users completed KYC verification. The project processes roughly 500,000 Pioneer accounts through mainnet migration each week, showing consistent progress toward full functionality.
Legitimate partnerships add credibility to Pi’s claims. Banxa, a regulated firm operating across multiple countries, holds 30.5 million Pi tokens for fiat conversion services. A company with regulatory oversight wouldn’t risk its reputation on obvious fraud. More than 250 apps run in the Pi ecosystem, meaning developers invested time and resources building on the platform. This signals that some people genuinely believe in the project’s future potential.
Major Red Flags
Even with some legit infrastructure and partnerships, PI Network has a few red flags. The network runs on extreme centralization, with a few validator nodes controlling everything. This setup defeats crypto’s entire purpose of distributed control.
It’s been five years passed since PI launch, yet the team still won’t put out clear timelines about when liquidity will unlock or when they plan on lifting restrictions.
Major exchanges ignore Pi completely, with only OKX, MEXC, and Gate.io listing it under multiple restrictions. Exchanges like Binance and Coinbase do extensive due diligence before listing tokens, so their absence brings up serious questions about Pi’s compliance and long-term viability.
Locked liquidity is the project’s biggest weakness. Users can’t withdraw tokens to external wallets or sell them freely on open markets. The mainnet launched in February 2025, but nothing has changed for most users who still watch their tokens sit unusable in wallets. Without major exchange listings providing real market value, you have to ask whether these tokens are worth anything at all.
Pi Network doesn’t qualify as an outright scam because nobody pays money to join, and they built a working infrastructure that attracted millions. But calling it safe would be dishonest. High risk and high uncertainty are likely the best definition for this project right now.
Why Many Still Call Pi Network a Scam: User Pain Points
User experience plays a big role in how people judge Pi Network. For many users, the frustration starts with KYC. Some say they submitted their documents several times without getting clear feedback. Others are stuck in review for months, with no idea of what went wrong or when approval might come. Over time, that silence turns into doubt.
Technical problems make the situation worse. Users report multiple app crashes, login errors, and issues syncing Two-factor authentication, which basically blocks access to their accounts. Wallet-related problems also come up.
Some users claim their balances changed during migration or that tokens did not appear after the process finished. While many of these cases link back to incomplete verification or earlier account issues, those details rarely matter once the stories spread online.
Limited access to major exchanges adds another layer of frustration. After years of mining, users still can’t freely sell or transfer their PI. Without withdrawals, the PI value is more or less theoretical. For people who invested time and effort, that gap between expectation and reality feels discouraging. It also fuels questions about whether PI coin is real or fake.
On Reddit threads and community posts, users have been complaining about long migration queues, along with unclear updates from support, with the same message from PI Network’s team to “wait patiently.” While a few users eventually resolve their issues after multiple liveness checks, the majority report little to no progress.
These ongoing delays and technical hurdles have driven frustration to the point where many users label Pi Network a scam.
How to Protect Yourself if You’re a PI Token Holder
Verify official announcements
If you’re holding PI, there are a lot of risks that come with widespread misinformation. Protecting yourself starts with verifying all updates and announcements through official Pi Network app channels. Don’t just rely on Telegram groups, Twitter posts. Look out for direct messages claiming to have insider access or early withdrawals. Many scams mix in with fake announcements copied from real updates.
Avoid OTC PI trades
Avoid all kinds of over-the-counter Pi trades completely. Since PI cannot be freely withdrawn or sold on major exchanges, these trades often involve unverified buyers, disputed payments, or even misleading IOU pricing. Participating in such trades can easily lead to financial loss.
Never share wallet passphrases
Never, under any circumstances, disclose your wallet passphrase or private keys to anyone. Not even support. Pi Network support does not request these details. Your passphrase has full control over your tokens. Write it down. Store it somewhere physically secure. Don’t save it digitally.
Red flags of fake Pi support scams (“Send 1 PI to verify”)
Watch out for support scams. Messages like “send 1 Pi to verify your account” are always scams. Legitimate Pi support will never ask for tokens. Sometimes the variations read like this: “Send 2 Pi to unlock migration” or “Transfer 5 Pi to activate wallet.” They are scams. Block and report them immediately.
Use escrow only within the ecosystem
Use escrow for trades within the ecosystem. Pi has built-in marketplace features. If you’re buying or selling goods for Pi, use escrow. It holds your payment until both parties confirm satisfaction. Not exactly perfect, but it’s better than direct transactions with potential scammers.
Conclusion: Pi Network Is Not an Outright Scam, but Carries Structural Risks
Pi Network does not fit the typical definition of a scam. Millions of verified users, active infrastructure, and real partnerships argue against calling it an outright scam. The blockchain runs; development continues; yet centralization, locked liquidity, and the issue of unclear timelines are unresolved.
The lawsuit adds legal pressure, but operational problems matter more to users. After five years, many still cannot access what they mined, and PI is yet to be listed on any Major exchange. Right now, PI Network looks like a project struggling to move from closed control to open access.
If you hold Pi, keep expectations grounded. Do not spend money buying it. Do not plan around future value. Treat it as a long-term experiment with uncertain outcomes. For a deeper look at supply dynamics and possible price paths, review the Pi Network price prediction analysis.
