Pi Network’s long-expected enlistment on stock exchanges has made the early adopters to urgently rush to their wallets only to discover that many of them have lost their important pass-phrases, making them easily fall prey to fraudsters and losing everything. This explosion of desperate users underscores the intrinsic dangers associated with self-custody within the digital money business, especially for those who are not familiar with its details.
The Scramble for Unknown Passwords:
This is the situation of many including Hong Hoa a pioneer of Pi Network from Quang Tri province. After owning over 4,000 PI tokens; she now has no access to her mainnet wallet which contains about 1,000 tokens worth much money. Hoa bemoans “my tokens are now worth about $2,000 ever since some exchanges listed Pi at $2 on Feb. 20 but I am locked out of my account and I have been trying to retrieve my old wallet’s passphrase”.
In this context, the desperation sweeping through the Pi Network community is brought into sharp focus by Hoa’s willingness to give half of what she owns just to get her funds back. Social media platforms are filled with appeals for assistance in wallet recovery with Facebook groups such as that of Anh seeing an astonishing number of requests. Anh clarifies, “Previously there were very few posts regarding recovery of wallet passphrases.” He adds, “It seems that early adopters are re-installing the app to access their Pi but forgot their passwords.”
Risks Associated with Holding Your Own Cryptocurrency and Seed Phrases:
The crux of the matter lies in how wallets within Pi Network operate – they rely on a 24-word seed phrase for authentication. In contrast with traditional passwords, it is this sentence that once lost makes the wallet useless forever.
This fact has led to an increase in scammers, who take advantage of the vulnerability of blocked users.
The Hoang, a Pi Network user since 2022, narrates his close shave with a scam. “I have nearly 800 Pi in my mainnet wallet hence I approached Facebook for support.” he says. They gave me a quote of VND5 million (US$196) and required that I install extra software and let them record my device’s screen. I sensed it was not true and declined the proposal.”
The Ongoing Illusion of Recovery:
Vo Do Thang, Athena cybersecurity firm director explains why seed phrase recovery is difficult. Some tools may be able to recover a single missing word, but recovering multiple lost words is all but impossible. “Users may need to get in touch with the original creators themselves; however, this is no simple task,” remarks Thang.
He strongly suggests not to trust online recovery services as these are very often scams. “In case they decide to seek help from outside agencies; people should only rely on famous individuals within the cryptocurrency community and never pay more than 5-10% upfront as an assurance against monetary risks,” warns Thang.
Pi Network’s Journey and the Importance of Security
The Pi Network came into existence in 2019, with its claim to fame being the promise of free cryptocurrency mining through a mobile app. However, late February saw the mainnet launch happen finally, thus revealing the vulnerabilities to security that confronted its user base.
This situation highlights how crucial it is to keep seed phrases secure and why self-custody is inherently risky when it comes to cryptocurrencies. As fortunes are forever lost by Pi Network users, this incident serves as a warning for any holder of digital currency.
