Internet Computer (ICP) Tokenomics
Internet Computer (ICP) Information
The Internet Computer provides the first true “World Computer” that can run any Web 2.0 system or service, and web3 services, entirely on-the-blockchain, including demanding web3 social media, without any need for centralized traditional IT such as cloud computing services. On the Internet Computer, services like social networks can be completely controlled by community DAOs, because they run entirely from the blockchain, with the aim of making users owners and part of the team, and enabling decentralized fundraising and more sophisticated tokenization. The blockchain hosts advanced smart contracts with ground-breaking new features, which include securely serving interactive web experiences directly to end users, processing and storing data with efficiency comparable to traditional IT, and directly creating transactions on other blockchains, such as Bitcoin.
Internet Computer (ICP) Tokenomics & Price Analysis
Explore key tokenomics and price data for Internet Computer (ICP), including market cap, supply details, FDV, and price history. Understand the token's current value and market position at a glance.
In-Depth Token Structure of Internet Computer (ICP)
Dive deeper into how ICP tokens are issued, allocated, and unlocked. This section highlights key aspects of the token's economic structure: utility, incentives, and vesting.
Overview
The Internet Computer Protocol (ICP) token is the native utility token of the Internet Computer blockchain. It is central to the network’s governance, resource allocation, and incentive mechanisms. Below is a comprehensive breakdown of its token economics, including issuance, allocation, usage, incentives, locking, and unlocking mechanisms.
Issuance Mechanism
- Inflationary Model: ICP is an inflationary token. New tokens are minted primarily to reward node providers and governance participants (neurons).
- Node Provider Rewards: The Network Nervous System (NNS) mints new ICP monthly, based on the 30-day moving average price of ICP in Special Drawing Rights (XDR). Rewards are distributed to node providers for operating network infrastructure.
- Governance Rewards: ICP holders who stake tokens in neurons and participate in governance receive daily inflationary rewards (maturity), distributed proportionally to voting power and participation.
- Inflation Rate: As of May 2024, the annual inflation rate is approximately 6.91%, projected to decrease to 5% eight years after Genesis.
Allocation Mechanism
The initial and ongoing allocation of ICP is as follows:
| Recipient | Allocation Description | Unlock Type | Unlock Schedule | Start Date | End Date | Amount Unlocked per Period | Total Periods |
|---|---|---|---|---|---|---|---|
| Early Contributors | 9.5% allocation, 100% unlocked at TGE | Cliff | Instant | 2021-05-10 | 2021-05-10 | 50,440,250 | 1 |
| Team Members | 18% allocation, 100% unlocked at TGE | Cliff | Instant | 2021-05-10 | 2021-05-10 | 95,571,000 | 1 |
| DFINITY Foundation | 23.86% allocation, 100% unlocked at TGE | Cliff | Instant | 2021-05-10 | 2021-05-10 | 126,684,670 | 1 |
| Internet Computer Association | 4.26% allocation, 100% unlocked at TGE | Cliff | Instant | 2021-05-10 | 2021-05-10 | 22,618,470 | 1 |
| Node Operators | 0.22% allocation, 100% unlocked at TGE | Cliff | Instant | 2021-05-10 | 2021-05-10 | 1,168,090 | 1 |
| Initial Community & Developer | 0.48% allocation, 100% unlocked at TGE | Cliff | Instant | 2021-05-10 | 2021-05-10 | 2,548,560 | 1 |
| Advisors & Other Third-Parties | 2.4% allocation, 100% unlocked at TGE | Cliff | Instant | 2021-05-10 | 2021-05-10 | 12,742,800 | 1 |
| Strategic Partnerships | 3.79% allocation, 100% unlocked at TGE | Cliff | Instant | 2021-05-10 | 2021-05-10 | 20,123,005 | 1 |
| Pre-Sale | 4.96% allocation, 1m cliff, 12m vesting | Cliff | Monthly (after 1m cliff) | 2021-06-10 | 2022-05-10 | 2,194,593 | 12 |
| Strategic Investors | 7% allocation, 1m cliff, 36m vesting | Cliff | Monthly (after 1m cliff) | 2021-06-10 | 2024-05-10 | 1,032,403 | 36 |
| Community Airdrop | 0.8% allocation, 1m cliff, 12m vesting | Cliff | Monthly (after 1m cliff) | 2021-06-10 | 2022-05-10 | 353,967 | 12 |
| Seed | 24.72% allocation, 1m cliff, 48m vesting | Cliff | Monthly (after 1m cliff) | 2021-06-10 | 2025-05-10 | 2,734,393 | 48 |
Note: TGE = Token Generation Event (mainnet launch).
Usage and Incentive Mechanism
ICP tokens serve multiple roles within the Internet Computer ecosystem:
- Governance: Stake ICP to create neurons, participate in on-chain governance, and earn voting rewards. Voting power is a function of the amount staked, lock duration (dissolve delay), and neuron age.
- Resource Payment: Burn ICP to mint “cycles,” which are used as gas for computation and storage in canister smart contracts. The ICP-to-cycles rate is pegged to XDR.
- Node Provider Rewards: Node operators are compensated in ICP for providing compute and storage resources.
- Medium of Exchange: ICP can be transferred between accounts, used in dApps, and traded on exchanges.
- SNS Swaps: Participate in Service Nervous System (SNS) DAO token launches by swapping ICP for SNS tokens.
Locking Mechanism
- Staking (Neurons): ICP holders can lock tokens in neurons via the NNS. The minimum lock period is 6 months, and the maximum is 8 years.
- Voting Power Formula:
Voting Power = (ICP staked + maturity staked) × Dissolve Delay Bonus × Age Bonus- 6 months lock: 1.06x Dissolve Delay Bonus
- 8 years lock: 2.0x Dissolve Delay Bonus (linear scaling in between)
- 4 years neuron age: 1.25x Age Bonus (linear scaling up to 4 years)
- Neuron Commands: Users can start/stop dissolving (unlocking), increase dissolve delay, or disburse tokens when the lock period ends.
Unlocking Time
- Vesting Schedules: As shown in the allocation table, most allocations (except for TGE unlocks) have a cliff (typically 1 month) followed by linear monthly vesting over 12, 36, or 48 months.
- Neuron Unlocking: Once the dissolve delay reaches zero, the neuron can be disbursed, returning the staked ICP (and rewards) to the user’s account.
- Minimum Claimable Reward: 1 ICP.
Additional Notes
- Burn Mechanisms: ICP is burned when converted to cycles, when paying transaction fees (0.0001 ICP per transfer), and when submitting (and failing) governance proposals (10 ICP fee, returned if proposal passes).
- No Capital or Profit Rights: ICP does not confer claims on capital, profits, or legal rights in the DFINITY Foundation or Internet Computer Association.
- Liquid Staking: As of September 2024, liquid staking solutions (e.g., Meta Pool) allow users to stake ICP and receive liquid tokens (stICP) usable in DeFi, enhancing flexibility and composability.
Summary Table: ICP Token Economics
| Aspect | Details |
|---|---|
| Issuance | Inflationary, rewards for node providers and governance participants |
| Allocation | See detailed table above |
| Usage | Governance, resource payment (cycles), node rewards, exchange, SNS swaps |
| Incentives | Voting rewards, node provider rewards, DeFi opportunities via liquid staking |
| Locking | 6 months to 8 years (neurons), voting power increases with longer lock and neuron age |
| Unlocking | Linear vesting for most allocations; neurons unlock after dissolve delay ends |
| Burn Mechanisms | Cycles minting, transaction fees, failed proposal fees |
| Liquid Staking | Available via Meta Pool and similar protocols |
This structure ensures robust network security, decentralized governance, and sustainable economic incentives for all participants in the Internet Computer ecosystem.
Internet Computer (ICP) Tokenomics: Key Metrics Explained and Use Cases
Understanding the tokenomics of Internet Computer (ICP) is essential for analyzing its long-term value, sustainability, and potential.
Key Metrics and How They Are Calculated:
Total Supply:
The maximum number of ICP tokens that have been or will ever be created.
Circulating Supply:
The number of tokens currently available on the market and in public hands.
Max Supply:
The hard cap on how many ICP tokens can exist in total.
FDV (Fully Diluted Valuation):
Calculated as current price × max supply, giving a projection of total market cap if all tokens are in circulation.
Inflation Rate:
Reflects how fast new tokens are introduced, affecting scarcity and long-term price movement.
Why Do These Metrics Matter for Traders?
High circulating supply = greater liquidity.
Limited max supply + low inflation = potential for long-term price appreciation.
Transparent token distribution = better trust in the project and lower risk of centralized control.
High FDV with low current market cap = possible overvaluation signals.
Now that you understand ICP's tokenomics, explore ICP token's live price!
How to Buy ICP
Interested in adding Internet Computer (ICP) to your portfolio? MEXC supports various methods to buy ICP, including credit cards, bank transfers, and peer-to-peer trading. Whether you're a beginner or pro, MEXC makes crypto buying easy and secure.
Internet Computer (ICP) Price History
Analyzing the price history of ICP helps users understand past market movements, key support/resistance levels, and volatility patterns. Whether you are tracking all-time highs or identifying trends, historical data is a crucial part of price prediction and technical analysis.
ICP Price Prediction
Want to know where ICP might be heading? Our ICP price prediction page combines market sentiment, historical trends, and technical indicators to provide a forward-looking view.
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Disclaimer
Tokenomics data on this page is from third-party sources. MEXC does not guarantee its accuracy. Please conduct thorough research before investing.
Buy Internet Computer (ICP)
Amount
1 ICP = 4.892 USD