ICP TOKEN — UTILITY AND GOVERNANCE

The ICP token serves three purposes:

1. GOVERNANCE

ICP holders can stake tokens in the NNS to vote on proposals. Voting power is proportional to stake. Staking duration multiplies your voting power (8 year staking = 3x multiplier).

2. CYCLES CONVERSION

ICP can be converted to cycles to power canisters. This is a one-way conversion: ICP goes in, cycles come out. This creates demand for ICP.

3. REWARDS

Node providers are rewarded in ICP. stakers receive voting rewards. This incentivizes participation.

TOKENOMICS:

Total supply: ~520 million ICP

Circulating: ~480 million ICP

Locked in staking: ~300 million ICP

DISTRIBUTION:

- DFINITY Foundation: 23.86%

- Team and advisors: 18.00%

- Public sale: 4.95%

- Seed contributors: 9.50%

- Strategic contributors: 9.93%

- Early token holders: 3.56%

INFLATION AND DEFLATION:

ICP has both inflation and deflation:

- Inflation: Node provider rewards, staking rewards

- Deflation: Cycles burned, governance proposals

The net effect depends on usage. More canisters running = more cycles burned = deflationary pressure.

This creates a direct link between network usage and token value.

Next: Part 11 — Network Nervous System (NNS)

$ICP #InternetComputer #Course