Vietnam’s Node Crackdown Rattles Pi Network—Decentralization in Peril?

Another day, another ’decentralized’ project facing centralization pressures. Vietnam’s aggressive node control measures have Pi Network’s community on edge—just as retail investors were starting to believe the ’next Bitcoin’ hype.

When regulators play whack-a-mole with nodes, who really holds the power? The Pi team’s silence speaks volumes. Meanwhile, VC-backed chains keep rolling out compliance-friendly validators—funny how that works.

Memo to Pi miners: maybe diversify beyond that mobile farming app. The crypto graveyard is full of projects that mistook viral growth for unstoppable decentralization.

TLDR

• Pi Network has nearly half of its total nodes located in Vietnam, creating concerns about decentralization.
• Vietnam hosts 154 out of 319 global nodes, making up 48.2 percent of the network’s infrastructure.
• Local regulations in Vietnam restrict the use of Pi Coin for payments, increasing legal risks for network participants.
• The Vietnamese government is considering new rules that could affect cryptocurrency custody and node operations.
• Pi Network has only two validator nodes controlled by the core team, raising governance concerns.

Pi Network is experiencing operational imbalance as nearly half of its global nodes are located in Vietnam, raising decentralization concerns. Recent figures show Vietnam hosts 154 out of 319 total nodes, or 48.2%, creating a regional concentration. This imbalance, combined with tightening Vietnamese regulations, puts Pi Network’s stability and long-term functionality at risk.

Pi Network Struggles with Node Imbalance

Pi Network faces a structural issue as Vietnam continues to dominate its node distribution, potentially undermining its global infrastructure. At the time of reporting, 33 of the 76 connected nodes also operated from Vietnam, reinforcing this trend. Such a geographic imbalance limits the global reach and fair participation in PI Network’s operations.

This centralization risks giving users in one region disproportionate control over network monitoring and oversight activities. Other countries have far fewer nodes, reducing their influence on network activities and decisions. As a result, Pi Network’s claim to global accessibility weakens under the weight of regional dominance.

Moreover, Pi Network’s reliance on a single country exposes the project to regional legal disruptions that could harm network reliability. Vietnamese laws currently restrict using cryptocurrencies, including Pi Coin, for payments or transactions. Consequently, ongoing changes in legal frameworks could hinder local operations and impair node connectivity.

Regulatory Pressure Adds to Structural Risks

Vietnamese regulators have increased scrutiny on Pi Network due to rising concerns about its operations and token usage. Local laws classify Pi Coin outside the legal payment framework, making its use subject to fines and legal penalties. Authorities have also warned about potential criminal implications under financial regulations.

The Vietnamese Ministry of Finance is preparing stricter rules that may restrict digital asset activities to licensed entities. If enacted, this policy could impact Pi Network miners and operators in the region. Any disruption to Vietnam-based nodes could reduce the platform’s operational resilience and network consistency.

In 2023, Vietnamese agencies investigated Pi Network to assess its compliance and business model transparency. The findings raised doubts about the project’s structure and sustainability under current laws. These developments further stress Pi Network’s reliance on nodes within a legally sensitive jurisdiction.

Pi Network Faces Token Control Concerns

Pi Network centralization issues extend beyond node distribution, as token supply remains mostly controlled by the Core team. According to Piscan, Pi Foundation wallets hold over 60.7 billion of the 100 billion Pi supply. This creates an uneven distribution, limiting community ownership and economic fairness.

With only two validator nodes operated by the CORE team, governance remains highly centralized and closed to external participation. This limited validator structure also raises concerns about transparency and decision-making power within the network. A project promoting decentralization must allow broader access to validation rights.

Claims of insider selling have surfaced within the community, which could further erode confidence in Pi Network’s leadership. While unconfirmed, such concerns underline the need for transparent token management.