What Is Internet Computer (ICP) and How To Use It: A Beginner’s Guide

The Internet Computer is a network of sub-blockchains controlled by an ownerless master blockchain that aims to expand the functionality of the public Internet through a revolutionary serverless cloud model. The result is a more open, secure, and censorship-resistant Internet that is able to host any applications on a single platform. In addition to providing a more decentralized infrastructure for the Internet, the Internet Computer also has the potential to lower costs and increase speeds for users around the world. Here is everything you need to know about the new cryptocurrency from Dfinity.

How Does Internet Computer Work? 

As of today, the reality is that most blockchains are either too slow or too expensive to achieve DeFi and Web3.0 objectives. With the Internet Computer, we can finally have a blockchain that is fast enough and cheap enough to support all of the Web 3.0 and DeFi applications that we’ve been dreaming about. And, best of all, we don’t have to submit to the whims of Google, Amazon, Meta Platforms, or any other company. The future is here — and it’s looking bright.

ICP is a protocol that allows computers to connect to each other and share information without the need for a central server. Instead, ICP uses independent data centers — a decentralized network of nodes, which are independent computers that store data and relay information to each other. ICP is powered by blockchain technology, which means that it is secure and transparent. ICP is different from traditional Internet protocols because it does not rely on a single entity to provide identity or authentication. Instead, ICP uses a decentralized system of nodes to verify identity and authenticity. This makes ICP more secure and resilient than traditional protocols. ICP is still in development, but it has the potential to revolutionize the way we use the Internet and approach data storage.

What is the Internet Computer — the Dfinity Project at a Glance | by  TheLuWizz | Coinmonks | Medium

The Internet Computer uses a novel consensus protocol. Several machines must agree on which inputs to process and in what order to do so to maintain a coherent state. Instead of just one machine, several machines around the world run each piece of software, and the majority of those machines collectively define the software’s actual state. If the bulk of copies successfully run the software, it will not matter if some individual replicas (a replica is an instance of the Internet Computer software that runs on a node) report a modified state, have connectivity problems, or if they even are malevolent.

Chain Key cryptography is the power source and the technology facilitating the Internet Computer’s operation. It is a breakthrough in computer science that enables a whole new level of security and functionality. With Chain Key, every computer on the network is able to independently verify the authenticity of each piece of data, ensuring that no malicious data can be injected into the system. This makes the ICP protocol incredibly secure, highly scalable, and efficient.

The Chain Key technology consists of several other systems, like the Network Nervous System (NNS) and Internet Identity (IID). NNS is a decentralized system of algorithms that govern the operation of the Internet Computer network, while IID is an anonymous blockchain authentication framework.

ICP tokens’ allocation

ICP tokens are the native cryptocurrency of the Internet Computer ecosystem. They are used to reward network participants and to pay transaction fees.

ICP History & Founders

The development of ICP started in 2019 with the release of Copper, which introduced the software development kit (SDK) and Motoko — a programming language designed specifically for writing smart contracts.

ICP roadmap major achievements
Some of the major projects from the ICP roadmap that have already been completed.

Dominic Williams is the man behind the Internet Computer, a blockchain-based platform that promises to be a game-changer in the world of decentralized applications. Williams has a long history in the world of crypto, having worked on startups since the 2010s. He later went on to found Dfinity, a project that received a lot of attention in the crypto community due to its ambitious goals. However, it wasn’t until 2016 that Dominic Williams really started to make waves with the Internet Computer. The project aims to provide a platform for developers to build decentralized applications and enterprise systems that are scalable and secure. So far, the team has made great progress, and the platform is already live. With Dominic Williams at the helm, it’s safe to say that the Internet Computer is in good hands.

How to Stake ICP Tokens?

ICP uses the Threshold Relay consensus, a heavily optimized version of the proof-of-stake (PoS) consensus algorithm, which is more energy-efficient than Proof of Work. If you want to start staking ICP, you first have to install the Network Nervous System (NNS) software on your computer.

Advantages & Disadvantages of ICP

The Internet Computer is the newest kid on the block, offering a revolutionary new paradigm and technology with near-term goals of integrating Bitcoin and Ethereum.

The Internet Computer is designed to be fast, scalable, and secure. To achieve these goals, the DFINITY Foundation is building a network of distributed nodes that are powered by high-performance data centers. With the ambition to run at web speed, еhe Internet Computer is the fastest blockchain around, thanks to a finality time of 2 seconds and a query response time of 100 ms.

Additionally, its canister smart contracts offer real web 3.0 functionality, serving the web and interacting directly with users.

And if that wasn’t enough, scalability is unlimited on the Internet Computer, making it a highly adaptable blockchain that allows its community to vote on proposals through the Network Nervous System to manage the chain.

These are just some of the innovative and robust features that make the Internet Computer stand out. 

The foundation is also working on ways to make the Internet Computer more accessible to people around the world. The goal is to create a new internet that is free from censorship and government control.

The potential of the Internet Computer Protocol (ICP) is great, but its future is dependent on possibilities rather than certainties, and that is the biggest downside of ICP. While there is potential for great rewards, there is also potential for significant losses.

ICP vs Ethereum

So, the question is: How does the Internet Computer compare to similar blockchain platforms?

Although the project is frequently referred to as “Ethereum Killer,” the ICP team prefers to call it “Ethereum Savior.” That’s because ICP seeks to improve existing blockchains by making them faster, less expensive, more environmentally friendly, and sustainable rather than to replace or disrupt them.

We will compare the Internet Computer to Ethereum by several parameters.

  1. Transactions time and cost

When making a transaction on Ethereum, you have to take into account the gas cost. This is the amount of ether you’re spending on a transaction — it actually goes to miners. The gas cost is usually very low, but it can fluctuate depending on the network congestion. The other thing to consider is the time it takes for a transaction to be processed. On average, it takes about 15 seconds to receive confirmation. However, it can take much longer during periods of high network traffic. This can be frustrating for users who are trying to make a quick transaction. In contrast, transactions on the Internet Computer are nearly instantaneous and only cost a fraction of a cent. This is one of the reasons why ICP has the potential to become a top 50 coin. There is no need to worry about gas prices or wait times when making a transaction.

  1. On-chain storage cost

As more and more businesses begin to move their data onto the blockchain, the need for a cheaper, more efficient way to store that data will become more and more pressing. And that’s where the Internet Computer comes in. Thanks to its use of ICP canisters, the Internet Computer is able to offer a much cheaper and more scalable solution for on-chain storage. Currently, 1 gigabyte of data stored on the Ethereum blockchain for a calendar year would cost around $240,000,000. That same 1 gigabyte of data stored on the Internet Computer would cost roughly $5 per year.

  1. Smart contracts

Canisters — the type of smart contract used on the Internet Computer — are limitless smart contracts that make it possible to reimagine everything, including interactive web and decentralized applications (dApps) in place of Big Tech Clouds (Google, AWS, Azure, and others). Canisters are bundles of WASM code and memory pages that are used to store and execute applications on the Internet Computer. Canisters are the evolution and specialization of smart contracts and are more efficient and cheaper to use than traditional smart contracts.

While in the Ethereum network, developers pay to deploy smart contracts, and people pay to use them, the Internet Computer uses a “reverse gas model” where only developers supply the funds needed to run the applications that use their gas. Furthermore, on Ethereum, 1GB costs about $5,000,000, and on the Internet Computer, 1GB costs about $3–5. This makes the Internet Computer a more cost-effective platform for developers to deploy their applications on.

  1. Staking rewards

The Internet Computer staking delivers the largest return, starting from 15.4% per year for 6-month staking up to 28.9% per year for 8-year staking, as can be seen in the table below.

Source: dfinitycommunity.com

These are just some of the key differences between ICP and Ethereum.

ICP FAQ: Everything You Need to Know about Internet Computer

Who is the owner of the ICP coin?

Dominic Williams and the DFNITY Foundation created the Internet Сomputer.

Is ICP a coin or a token?

ICP is running on the Internet Computer blockchain, so technically, it’s a coin. Nevertheless, the DFINITY team and community often use the terms loosely and call ICP a token.

Is ICP crypto a good investment?

Given the current state of the cryptocurrency market, it is difficult to predict whether or not ICP will be a good investment. However, the altcoin has a number of factors working in its favor. First, the coin is backed by a strong team led by experienced industry veteran Dominic Williams. Second, ICP has a clear roadmap and ambitious plans to build a decentralized infrastructure that could challenge the likes of AWS, Google, and Facebook. 

While there is no guarantee that ICP will succeed in its long-term goal, the altcoin certainly has the potential to become a major player in the crypto space.

None of the content on Changelly is investment advice, nor is it a replacement of advice from a certified financial planner. Before deciding to buy ICP, we recommend you to do your own research.

Does ICP have a max supply?

ICP has a total supply of 469,213,710 coins.

Will ICP reach 100 dollars?

According to the latest ICP price predictions, ICP is likely to reach $115.17 by the end of 2030.

What is ICP’s all-time high?

The debut of Internet Computer (ICP) on Coinbase in May 2021 sent the token’s price soaring. On Binance, bids for ICP reached as high as $3,093, while HitBTC reported a peak of roughly $407. The huge price differences across multiple cryptocurrency exchanges showed a berserk trading sentiment in the ICP market, landing the token in the list of top 10 cryptocurrencies by market capitalization. While some traders see ICP as a hot new commodity, others caution against investing too heavily in the volatile token. 

Disclaimer: Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.

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