Pi Network's PI Token Drops 30% Despite $100M Venture Fund Announcement

Pi Network's native token, PI, experienced a significant drop of over 30% in the past 24 hours, despite the much-anticipated announcement of a major ecosystem development. At the time of reporting, the token was trading at $0.8405. This decline is particularly noteworthy given the recent bullish sentiment surrounding the Pi Network, which had seen the PI coin price surge past $1. However, the token remains more than 55% down from its February 2025 highs near $3.00, trading around $1.33 as of May 13.

The recent ecosystem announcement by Pi Network was intended to boost investor confidence and drive the token's value higher. On May 14, the Pi Foundation announced Pi Network Ventures, a $100 million fund to support startups that build real-world utility and drive adoption. The initiative will function similarly to a typical venture capital firm, focusing on startups in generative AI, gaming, FinTech, e-commerce, and social media platforms, in addition to blockchain-native companies. Despite the scale of the announcement, the market’s reaction was muted, and in fact, negative. Pi Network (PI) slid from a daily high of $1.30 to a low of $0.8552 before settling near $0.92, a nearly 30% drop.

The sharp drop suggests that the news may have missed market expectations. Traders possibly anticipated a major exchange listing, which could have brought real liquidity and price discovery. Instead, with no listing announcement, some investors may have viewed the fund launch as underwhelming or already priced in, triggering a “sell the news” reaction. The underwhelming market response to the ecosystem announcement highlights the challenges faced by the Pi Network in gaining broader acceptance and driving sustained growth. Despite the recent price increase, significant obstacles remain that could prevent the PI coin from reaching higher valuations in the near future. These challenges include regulatory hurdles, competition from other cryptocurrencies, and the need to build a robust and functional ecosystem that attracts users and developers.

Technical indicators show a neutral to bullish bias. PI is trading above important moving averages, including the 50-day SMA and the 10-day EMA, which both indicate buy signals. While the relative strength index at 57.24 is neutral and indicates market indecision, the moving average convergence divergence points to a short-term bullish potential. If PI holds above support at $0.85, there may be a brief recovery toward $1.10. On the other hand, PI might retest the $0.74 support area if it drops below $0.85. For now, the market appears to be digesting the announcement, with short-term traders rotating out, even as the project continues building.

The Pi Network's recent struggles serve as a reminder of the volatility and unpredictability of the cryptocurrency market. Even with long-awaited developments and positive news, market sentiment can quickly shift, leading to significant price movements. Investors in the Pi Network and other cryptocurrencies must remain vigilant and prepared for such fluctuations, while also considering the long-term potential of their investments. The market’s reaction to the Pi Network Ventures announcement underscores the importance of meeting or exceeding investor expectations in driving sustained growth and adoption in the cryptocurrency space.