Here’s Why Pi Coin Price is Falling as Bitcoin and Altcoins Rebound

Pi Coin price has been in a freefall this month, erasing some of the gains it made last month. The token traded at $0.2160, its lowest since November 14. It stood 25% below the November 8 peak.

This crash happened even as Bitcoin and most altcoins rebounded ahead of the Federal Reserve interest rate decision.

Pi Coin Price Falling as Headwinds Rise

Pi Network price has remained in a steep sell-off that has cost investors millions of dollars. This plunge occurred as it continued to face major headwinds. This included a lawsuit that was filed in the United States.

The lawsuit alleged that Socialchain, its creator, was involved in a big fraud that had cost investors billions of dollars. The plaintiff pointed out that Pi’s team had promoted the app as a decentralized cryptocurrency project.

In reality, he noted that it was a centralized project where the Pi Foundation has all the control. Additionally, the plaintiff contended that Pi Network’s team engaged in numerous obscure transactions that contributed to the sell-off.

As a result, he is seeking $10 million in damages. Pi’s team has not responded to the lawsuit.

Pi Token Unlocks are Continuing as Demand Stalls

Pi Coin price has also underperformed the market as its token unlocks continue rising. Pi Scan data indicates that the network will unlock over 144.7 million more tokens in the remainder of the year.

It will unlock over 1.216 billion tokens worth over $262 million in the next 12 months. That makes it one of the most dilutive players in the crypto industry.

The average monthly unlocks are over 18.6 million, which are worth over $4 million today. Token unlocks hurt a cryptocurrency’s price by increasing the supply in circulation.

The ongoing supply increase is happening at a time when demand remains subdued. Pi Network’s volume stood at over $18.5 million in the last 24 hours.

It’s a tiny figure for a cryptocurrency with a market capitalization of nearly $2 billion and a fully diluted valuation (FDV) of $21.47 billion.

There are other reasons why the Pi Coin price has slumped in the past few days. More tokens are entering the mainnet. Developers announced a new feature to speed up KYC.

It has faced historical challenges. The lack of additional exchange listings has hurt growth. A weak ecosystem has dampened industry sentiment.

Additionally, traders are likely selling the recent Pi Network news. This includes its MICA application in Europe and the investment in CiDi Games and OpenMind.

CiDi Games is a top game developer that aims to integrate Pi token in its operations. At the same time, OpenMind is a top player in the artificial intelligence industry.

Pi Coin Price Has Formed a Double-Top Pattern

Technical analysis suggests that the Pi Coin price has formed a potentially risky pattern. This may trigger more downside in the near term. It has formed a double-top pattern at $0.2828 and a neckline at $0.2020. This pattern is one of the most bearish signs in technical analysis.

The token has flipped the Supertrend indicator from green to red, a sign that bears are prevailing. Also, it has remained below the 50-day moving average, while the MACD indicator has moved below the zero line.

The Relative Strength Index (RSI) has moved from the overbought level of 70 to the current 40. A decline in these oscillators indicates that bears are gaining momentum.

Therefore, the most likely scenario is that it continues to fall, potentially to the key psychological level at $ 0.20. A drop below that level indicates further downside, potentially reaching the all-time low of $0.1528.