Lawyer: Pi Network may be suspected of pyramid scheme crime

according to the analysis by Lawyer Liu Zhengyao of Zhiheng (Shanghai) Law Firm, the promotion model of Pi Network may constitute pyramid selling crimes defined by Chinese criminal law after the opening of the secondary market trading on the exchange. According to the analysis, Pi currently has no physical project support, and it forms upper and lower level relationships through an invitation system, where the inviter can obtain benefits such as mining acceleration by developing downlines.

It is worth noting that if Pi is obtained through developing downlines and sold on the exchange, once the downline level exceeds three levels, the relevant organizers may face a maximum of less than 5 years of fixed-term imprisonment and fines; if the amount involved exceeds 2.5 million yuan or the number of developers exceeds 120 people, the sentence may be extended to more than 5 years.

In addition, in July 2023, the Hengyang Public Security Bureau in Hunan Province issued a statement stating that Pi has hidden risks.