Yerevan (CoinChapter.com) – ICP, the native token of Internet Computer Protocol, a new decentralized computing protocol for software services developed by DFinity, traded at $105 in the early European session Wednesday, losing over 80 percent after debuting on May 10 at $633 on Coinbase.
ICP surprised traders with its high-profile associations and listings right from the beginning. As it turned out, the token debuted directly on some of the leading cryptocurrency exchanges, including Coinbase, Binance, OKEx, and others, days after its launch.
Meanwhile, as a project, Internet Computer Protocol boasted about backings from globally recognized venture capitalists, including Twitter-famed Andreessen Horowitz, Polychain Capital — a New York-based hedge fund.
Carlson-Wee, who heads Polychain, earlier served Coinbase as its head of risk.
Change of wind
But the solid backings did little in maintaining ICP’s massive debut rates. The token started facing extreme selling pressure from the start that eventually led its prices down by more than 80 percent as of June 2.
Rumors pointed to early market participants behind the ICO’s free-fall. In retrospect, Dfinity raised $163 million via private funding rounds. The nonprofit also received $4.1 million in Bitcoin and Ethereum tokens in February 2017. The next year, in May, distributed $35 million worth of ICP tokens among its early backers, allocating about 0.8 percent of the total token supply.
Internet Computer kept token beneficiaries from selling off their ICP holdings by offering them the tokens’ IOU versions. The airdrop participants were able to transfer their IOUs back to ICPs only on May 11, a day before the token’s debut on Coinbase.
The free tokens create selling pressure, which could have triggered the ICP’s fall.
Later, ICP attempted to recover on May 20 but got swept with the rest of the crypto market’s decline that picked momentum on May 19.
Internet Computer token has a total supply of over 469 million coins.
What Is ICP And Is It A Good Investment?
The Zurich-based DFinity Foundation launched the Internet Computer Protocol as a gateway to a “new internet”.
One that is not in the hands of dominant corporations such as Google, Amazon, or Facebook. Initially, the project offers a system where the internet can support software applications instead of hosting them in a cloud. According to Mr. Williams, the protocol provides a “hackproof platform.”
Internet Computer hopes to achieve freedom from large corporations by relying on data centers – validators – to oversee the blockchain. The protocol claims to have a much larger capacity than Ethereum. ICP hopes to offer unlimited scaling possibilities that can support an ever-growing volume of smart contracts.
The reasons behind the launch of ICP remain the same, despite the fallen price. The token has strong fundamentals. The DFinity Foundation aspires to create a revolutionary new form of internet that tackles problems with the current system. Poor system security, monopolization of internet services, and misuse of personal user data, to name a few.
Moreover, the DFinity released a 20-year roadmap for their further development and goals they hope to successfully achieve.
The long-run viability of the project is not yet certain, but it was substantial enough to attract investors. Many traders in the Twitterverse are eager to ‘buy the dip.’ They believe there’s a big break ahead for ICP.