The Pi Network price has witnessed a sharp decline, losing significant value in recent days. The token, which recently gained traction among crypto investors, has dropped below a crucial support level as its latest recovery attempt lost momentum. On Sunday, Pi Network’s price hit $1.3340, marking a staggering 55% drop from its February peak. The coin’s market capitalization now stands at approximately $9.7 billion, raising concerns among investors about its future trajectory.
Why Is the Pi Network Price Crashing?
Several key factors have contributed to Pi Network’s recent downturn, including concerns over token unlocks, broader crypto market weakness, and bearish technical patterns. Let’s break down these factors in detail.
1. Concerns Over Token Unlocks and Dilution
One of the primary reasons behind Pi Network’s price decline is the concern surrounding upcoming token unlocks. Data from the Pi Network explorer reveals that the circulating supply stands at 7.22 billion tokens, while the total supply is set at a staggering 100 billion. This means that approximately 93 billion tokens remain to be unlocked gradually over the coming years.
For March alone, Pi Network is expected to unlock 188 million tokens, adding to the circulating supply. Moreover, over 1.4 billion tokens are scheduled for release throughout the year. A significant portion of these unlocks will take place between 2027 and 2028.
A rapid increase in the token supply without a proportional rise in demand could lead to further price drops. When a large volume of tokens enters the market, it typically results in dilution, reducing the value of each token. Investors appear to be reacting to this potential devaluation by offloading their holdings.
2. Crypto Market Weakness Weighs on Pi Network
The broader cryptocurrency market has experienced a downturn, and Pi Network has not been immune to this bearish sentiment. Bitcoin, the flagship cryptocurrency, has recorded a substantial decline, with the total market capitalization of all digital assets falling by 3.65% to $2.75 trillion.
The recent market-wide decline follows critical events in the U.S., including former President Donald Trump’s crypto summit. While the summit brought attention to digital assets and introduced discussions about a strategic crypto reserve, the market reaction has been largely negative. Investors appear to be engaging in a “sell-the-news” phenomenon, where they offload their holdings following major announcements.
Given the correlation between Bitcoin and altcoins, Pi Network has followed the broader market trend, exacerbating its already fragile technical position.
3. Bearish Technical Signals
From a technical perspective, Pi Network’s price crash was anticipated due to the formation of a Head and Shoulders pattern—a well-known bearish indicator in financial markets.
Pi Network peaked at $3 in February before steadily declining. The neckline of this pattern, which was located at $1.5020, was breached, confirming the bearish breakout. The token has since dropped below key technical levels:
- It has fallen below the 50-period moving average, indicating a shift in trend.
- The Relative Strength Index (RSI) is pointing downward, suggesting weakening buying pressure.
- The MACD (Moving Average Convergence Divergence) is also trending lower, further reinforcing bearish momentum.
These technical indicators suggest that Pi Network may continue its downward trajectory unless there is a strong reversal signal from buyers.
Where Is Pi Network Headed Next?
Bearish Scenario
If the bearish trend persists, Pi Network could decline further, with sellers targeting the $1.00 support level. A break below this level could accelerate losses, potentially pushing Pi Network to its post-listing lows. Such a scenario would represent an additional 50% drop from current levels.
Bullish Reversal Potential
On the flip side, if Pi Network manages to reclaim and sustain above the $1.50 resistance level, it could invalidate the bearish outlook. A successful push above this level could signal renewed buying interest and open the door for a potential recovery towards $2.00.
Final Thoughts
Pi Network is currently at a critical juncture. While its long-term fundamentals and adoption potential remain strong, short-term price action suggests heightened volatility. Investors should keep a close eye on upcoming token unlocks, broader market trends, and key technical levels to navigate the current price uncertainty.
As the crypto market evolves, Pi Network’s performance will largely depend on investor sentiment, adoption trends, and overall market conditions. Whether this dip presents a buying opportunity or signals further downside remains to be seen.
