What is ICON (ICX)?
ICX is the native token for the ICON Network. ICON is a decentralized layer 1 network that acts as a multi-chain bridge, connecting the Binance Smart Chain, Ethereum, Moonriver, Polkadot, as well as numerous other blockchains.
ICON is known for its unique Blockchain Transmission Protocol (BTP), which enables cross-chain operations such as token swapping and communication. Its interoperability aims to accelerate the mass adoption of cryptocurrencies and blockchain technology as a whole.
Who Founded ICON?
One of the co-founders of ICON is Min Kim. He’s a prominent figure in the East Asian blockchain space and has previously worked as the Chief Strategy Officer at the FinTech giant DAYLI. Additionally, Kim is part of ICONLOOP, a Web3 blockchain development company.
Prior to the Mainnet release, ICON held an initial coin offering (ICO) in September 2017. During this time, the ICX price raised for the tokens was $43 million, accounting for about 50% of the token supply available at the time.
The core goal of ICON was to create a platform that would enable the interoperability of various blockchains. Decentralized blockchain-based networks typically cannot directly communicate with each other, and users need to jump through various hoops to conduct cross-chain transactions.
ICON aims to be the solution to this issue. By enabling multi-chain communication, the platform hopes to improve the process of crypto adoption and make the process of trading different assets simpler, without compromising the security and decentralization of each bridged network.
In January 2018, ICON was officially launched. At this time, ICX was valued at around $10. The early months in the market were highly volatile, with the asset experiencing both sudden hikes and declines. Its first year on the market ended on a lower note, with the ICON price dropping down to $0.20.
For around two years, between late 2018 and late 2020, the token had stabilized, with the volatility remaining low and the value staying under $1. However, 2021 saw some more activity in the token’s market performance. The ICX price went up to nearly $3 twice – in April and November.
What Are the Features of ICON?
ICON is an inflationary asset. It doesn’t have a set maximum supply limiting the number of ICON tokens in circulation. The ICX price may be more difficult to predict than for a deflationary asset. However, the protocol has had its inflation rate set to 36 million new ICX minted annually. The inflation rate can be altered by a governance vote.
The main service provided by ICON is the Blockchain Transmission Protocol (BTP). According to the platform, there is no limit on how many connections can be made using BTP. The technology is blockchain-agnostic. This means that it can be implemented on any network to bridge two blockchains and enable interoperability.
The Protocol uses decentralized relays to enable multi-chain messages to be transferred. All messages are verified on-chain. The BTP enables not just regular cryptocurrency transactions and communication but also NFT ownership transfers. It facilitates the complicated process of cross-chain NFT ownership verification.
Additionally, the ICON network can be used to support DeFi technology, particularly decentralized applications (dApps). The platform hosts its own decentralized exchange (DEX), which allows faster cross-chain transactions via gateways. The ICON crypto ecosystem is KYC-free, making it both decentralized and anonymous.
Developers are offered an opportunity to participate in the Contribution Proposal System (CPS). It’s ICON’s grant program that provides financial support for development, marketing, and blockchain community building. All funds are decentralized. Due to the relatively volatile ICX price, the grants are paid using the bnUSD stablecoin at a predictable rate.
The ICON network is secured using the Delegated Proof-of-Stake (DPoS) consensus mechanism. Two types of ICON coin holders are part of this process – the stakeholders and the validators. Stakeholders are required to delegate a share of their assets to the selected validators.
Both the delegators and the validators are both able to make a profit from their contributions and active participation. The stakeholders that delegate their assets can earn a passive income adjusted to the ICON price value of their staked amount. The technical validators receive transaction fees as block rewards.
The DPoS processes are closely tied to network governance. ICON functions as a decentralized autonomous organization (DAO). Validators directly participate in the governance processes. They handle both on- and off-chain responsibilities and are considered Public Representatives (P-Reps) of the ICON Network.
Validators that wish to become P-Reps must pay the registration fee. The ICON price for participating in the DAO is 2000 ICX. Network nodes can be penalized for failure to actively participate in the network processes. Users that don’t vote on network proposals receive a Missed Network Proposal Vote Penalty, which affects their rewards.
As part of their on-chain duties, P-Reps produce blocks, control the routine server maintenance, vote on network proposals, and manage the Contribution Proposal System. Off-chain, users are encouraged to participate in discussions on social media and act as community moderators. Their main job is to educate prospective users about ICON.
