Lawyer: Pi Network or suspected of pyramid scheme crimes

According to a report by Golden Finance, Liu Zhengzheng, a lawyer from Zhiheng (Shanghai) Law Firm, analyzed in an article that after Pi Network goes online and opens up secondary market trading on the exchange, its promotion model may constitute pyramid selling crimes as defined by Chinese criminal law. According to analysis, Paicoin currently has no physical project support and adopts an invitation system to form a hierarchical relationship. Inviters can obtain benefits such as mining acceleration by developing downlines. It is worth noting that if the distribution of coins is obtained through offline development and sold on the exchange, once the offline level exceeds three levels, the relevant organizers may face imprisonment for up to 5 years and fines; If the amount involved exceeds 2.5 million RMB or the number of individuals involved exceeds 120, the sentence may be extended to more than 5 years. In addition, in July 2023, the Public Security Bureau of Hengyang City, Hunan Province, issued a statement stating that there were risks and hidden dangers in distributing currency.