Blockchain

How did Internet computers (ICP) become the top ten cryptocurrencies overnight?

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On Monday, traders valued the Internet Computer (ICP) at $630, and the currency made its debut on Coinbase. However, on Binance, as of Tuesday, U.S. dollar buying of tokens soared to $3,093. At the same time, HitBTC reported that the peak value of ICP is about $407.

This Huge price difference Transactions across multiple cryptocurrency exchanges show the crazy trading atmosphere in the Internet computer market. ICP is included in the list of top ten cryptocurrencies by market value, and even exceeds XRP, Dogecoin (Dog) And Cardano (Have) And reached fourth place.

ICP 1-hour candle closing price of multiple cryptocurrency exchanges. Source: Tradingview

After the profit-taking sentiment was over, there was a substantial price correction. Entering the trading session on Wednesday, the ICP/USD exchange rate of Coinbase and Binance is approximately US$338. On HitBTC, it rose by $14. On the downside, the ICP ranking dropped from fourth to eighth.

Why is the price of ICP rising?

The sudden arrival of ICP among the top cryptocurrencies caught many crypto traders and analysts by surprise. A quick glance at Internet Computer, the issuer of the token, described it as a “blockchain-based cloud computing project” that aims to build an open public network.

However, for traders, the biggest gain is that the project has attracted the participation of well-known institutional investors. These include the U.S.-based angel investor Andreessen Horowitz (Andreessen Horowitz), known for his early Twitter support; and New York-based cryptocurrency-focused hedge fund Polychain Capital, funded by Olaf Carlson. Olaf Carlson-Wee takes the lead, and Olaf Carlson-Wee previously served as the company’s head of risk. Coinbase.

At the same time, the ICP token was listed on top cryptocurrency exchanges immediately after its launch on Friday. This reflects a strategy carefully devised by the Zurich-based non-profit organization Internet Computer DFINITY, which brings ICP tokens directly into the conscience of everyday traders.

What is Internet Protocol?

Looking back, DFINITY aimed to develop a blockchain-based infrastructure in which the Internet itself supports software applications instead of cloud hosting providers. Its Internet computer protocol proposes to host online services such as social media, messaging, search, storage, and peer-to-peer digital interaction on top of it. A public Web 3.0 cloud computing protocol similar to the Web.

The goal involves more reliance on large data centers and high-end node machines (aka validators), whose capacity is much larger than that provided by the leading Ethereum blockchain.

In short, DFINITY hopes that it will provide the first truly global blockchain network that runs at the highest network speed and has unlimited expansion capabilities to support any number of smart contract calculations.

Mira Christanto, a researcher at the cryptographic analysis platform Messari, said: “If IC succeeds in replacing traditional IT, there will be no need for centralized DNS services, anti-virus, firewalls, database systems, cloud services and VPNs.”

DFINITY recommendations Decentralization by introducing a unique consensus model It is called threshold relay, coupled with its blockchain nervous system to ensure algorithmic governance.

At the same time, ICP acts as the native asset of Internet computers. Its role in the platform involves allowing users to participate in the rights and interests of the blockchain nervous system and a security deposit, which allows private entities including client software and cloud networks to connect to the Internet Computer’s public network.

ICP’s growth prospects

DFINITY earlier raised $163 million through private financing. At the same time, the non-profit organization also received $4.1 million in Bitcoin and Ethereum tokens in February 2017.In May 2018, it Airdropped $35 million worth of ICP tokens (Formerly known as DFN) among its early supporters. This marks 0.8% of the initial supply of ICP.

Airdrop participants received the IOU version held by ICP in September 2020. They were able to transfer the token back to the ICP on May 10, the day before the token debuted on Coinbase.

After ICP’s bid on Binance exceeded $3,000, its stock price plummeted by 89%. Source: Tradingview

Dfinity aims to expand its data center and developer network. As of now, the non-profit organization is operating seven subnets in 12 independent data centers with 68 nodes. The goal is to reach 123 data centers by the end of 2021, hosting 4,300 nodes.

Similar to Bitcoin and Ethereum, the growth prospects of infrastructure in the Internet computer ecosystem may cause speculators to increase long-term bids for ICP-enabled currency pairs.along with Investors continue to seek protection against concerns about macroeconomic inflation.