Launched in May 2021, ICP struggled in its first year. Could it be about to turn things around?
Internet Computer has the ambitious goal of changing the internet, aiming to make it a decentralised paradise. But the blockchain is haunted by its past, which saw large amounts of ICP tokens dumped in its first month of operating.
The internet currently works by sending data from large centres to devices. For example, this article is stored in a data centre and is being sent to the laptop or other device that you are reading it on. Internet Computer wants to fundamentally change this, by allowing individual computers and data centres to store the information, which would result in a decentralised network.
ICP is the native utility token designed to power this system. It encourages people to engage with the network, as it is rewarded to those hosting the data and voting in key blockchain decisions.
It has been a bumpy journey for Internet Computer, with claims that DFINITY, the organisation behind Internet Computer, was involved in a scandal having similarities to a pump and dump scheme. DFINITY denies this, but it certainly has its work cut out if it wants to regain the trust of its community. Some ICP price predictions think a resurgence is possible, while others are not sure.
The Internet Computer buzz
DFINITY gathered a lot of hype around its decentralised network. This buzz was justifiable, as the blockchain’s goal was ambitious: it wanted to fundamentally change the internet. The idea of not having to pay hosting fees to technology giants was appealing to developers, while a more equal internet was attractive to potential users.
Internet Computer also had the support of some high-status venture capital firms. It had raised $120m (£91.4m) from firms including Andreessen Horowitz, Aspect Ventures and Polychain Capital.
The network showcased what it was capable of in 2020, where it demonstrated two applications built on the decentralised network: a LinkedIn clone called LinkedUp and a TikTok replica titled CanCan.
It was looking as if ICP had what it took to become a successful blockchain. The hype it had been building since its 2016 inception culminated on 10 May 2021, launch day. The token was almost immediately available to be traded on Coinbase, which pricked up ears but ultimately led to its downfall.
The BTC integration will be launched as part of DFINITY’s ‘Chromium Satoshi Release’, scheduled for Q1 2022, and will add smart contracts to the blockchain using ‘Chain Key cryptography’ that will reduce bridge usage, which can expose the network to malicious actors.
The ETH integrations are set to be rolled out in Q3 2022 with the ‘Vanadium Vitalik Release’.
The ICP crash
What followed after ICP’s launch were some incredibly volatile price fluctuations, even for a cryptocurrency. The token surged to $750 on its first day of trading and then lost 90% of its value within a month. By 10 June, ICP had dropped to $75.
Reaching a market capitalisation of $300bn, even if it was just for one day, is no easy feat. This is almost as high as Ethereum’s market capitalisation, which it took the cryptocurrency more than six years to reach.
But ICP’s downfall was not because of its hefty valuation. A report by Arkham, a cryptocurrency intelligence organisation, found that “insiders connected to DFINITY have been dumping billions of dollars of ICP on exchanges at the expense of small early supporters and retail investors”.
Arkham located an address that it suspected to be linked to DFINITY’s treasury, as the treasury holds the most ICP. This address deposited ICP worth $3.6bn at the time. Arkham also found 34 other addresses suspected to be insiders connected to DFINITY: these deposited ICP worth $1.6bn.
The depositing of the vast number of tokens would clearly explain ICP’s crash, as any cryptocurrency would struggle to maintain its price with that downward pressure.
Arkham claimed DFINITY acted in bad faith. It said: “DFINITY has not followed industry practices meant to demonstrate good faith and assure investors that project insiders won’t trigger a price collapse through massive selling.”
In a statement, DFINITY said it was not to blame. According to The New York Times, DFINITY said: “Day traders with alternative agendas and unethical crypto projects have used Reddit and Twitter to confuse the public.”
DFINITY clarified that it had moved the initial supply of ICP to a Coinbase account to transfer to the various categories of investors. It was these investors that had then “immediately transferred the tokens,” according to DFINITY.
ICP’s recent price history
After ICP fell to $75 in June, it continued to drop but at a less rapid pace. By the beginning of August, it started gaining support at the $30 level and stopped falling. It briefly saw a bullish trend that month, peaking at $84.75 on 6 September.
Internet Computer was not able to sustain this price and eventually continued its downward trend. ICP performed bearishly for the rest of 2021, and by 20 December it reached its all-time low of $21.04, according to CoinGecko.
The new year was a new slate for ICP. It raced from $25.36 on 1 January 2022 to $36.55 five days later. This came after the launch of the Terabithia bridge, a function designed to improve interoperability between Internet Computer and Ethereum.
Terabethia could be the next step for Internet Computer to scale. This bridge allows smart contracts to operate between the two blockchains, meaning assets can be created that function on both Ethereum and Internet Computer. For example, ERC-20 tokens can exist on the Internet Computer blockchain.
The excitement did not last for long, however. The price of ICP corrected on 6 January to below the $30 mark, and at time of writing on 31 January, the coin was trading at roughly $19.16. Is this just a momentary fall and will ICP start climbing again? Read on for experts’ Internet Computer price predictions.
ICP price prediction
Things are not looking hopeful after ICP’s latest price correction. WalletInvestor’s ICP coin price prediction says it is a bad long-term investment. It expects the coin to fall dramatically, dropping to $2.142 by the end of March and to $2.980 by December. Its ICP price prediction for 2025 is not much better, expecting it to fluctuate around the $1.20 level.
However, PricePrediction’s latest forecasts seem unaffected by ICP’s recent drop. Its ICP price prediction expects a steady rise over the next decade, which will surpass the $100 mark. Its ICP price prediction for 2022 is to reach an average price of $29.53, which will race to $87.96 in 2025. Its ICP price prediction for 2030 is a big $586.36.
There are other optimistic ICP price predictions, although not as ambitious. DigitalCoin expects a steady price growth for Internet Computer, from $26.27 in 2022 to $40.25 in 2025. Its furthest ICP price prediction forecasts the cryptocurrency to be trading at $81.89 in 2029.
The TradingBeasts ICP crypto price prediction estimates the coin to reach $68.575 in January 2024. Its ICP price prediction for the end of 2025 is $84.519. Meanwhile, CryptoNewsZ said: “Based on our Internet Computer price forecast, there are no sudden jolts or a stony path ahead for the major crypto coins.”
Internet Computer has certainly had a rocky past, with its price fluctuations last May making it an especially volatile cryptocurrency. ICP has its work cut out if it is to start reaching these optimistic targets.
It might be: ICP price predictions vary depending on who you ask. DigitalCoin expects a steady rise for the coin, predicting it will reach $81.96 in roughly a decade. Meanwhile, WalletInvestor forecasts another crash for the internet coin, with the cryptocurrency expected to lose most of its value over the next few months.
Remember, cryptocurrency prices can be extremely volatile, so you should never invest more than you can afford to lose.
It could. The consensus from most price predictions, except WalletInvestor, predicts ICP to rise over the next decade, but the speed of this growth varies. PricePrediction expects it to reach $586.36 by 2030, meanwhile DigitalCoin forecasts it to only hit $81.96 by then.
Investors should always do their own research before deciding to put any money into a cryptocurrency.
It depends. ICP is haunted by its controversial past, with Arkham claiming DFINITY, the organisation behind Internet Computer, exploited small investors. However, DFINITY said in a public statement that bad actors were to blame.
The organisation has proved it is still working hard on Internet Computer with the release of the Terebethia bridge, but you should always do your own research before investing.