2022 has been a terrible year for crypto investors and enthusiasts. The year alone has witnessed the collapse of juggernauts like Terra Luna, Celsius, Voyager and more recently, the second-largest crypto exchange, FTX, threatening to bring down the entire industry. These unforeseen collapses have triggered massive losses in the crypto market (the market has lost over 100% in value since the beginning of this year) as well as the fall in Internet Computer Protocol Crypto.
Table of Content
- Reasons why ICP is falling
- Internet Computer price prediction
- Internet Computer price movement
- What is ICP crypto? How does ICP crypto work?
- Who developed the Internet Computer?
List of Reasons Why ICP Crypto Fall
1. Adoption is Still Slow
The adoption of ICP crypto by the public has been slow since its launch last year in May. And it’s not about to change as the price of the token is projected to trend downward to near zero.
2. New Investors Are Not Keen
New investors are sceptical about the current and future of Internet Computer Protocol especially after seeing early investors of the token barred from exiting their position amid a fall in ICP/USD daily price earlier in the year.
3. Alleged Insider Trading By DFinity
It was alleged last year that the Dfinity Foundation dumped billions of dollars worth of Internet Computer tokens after misleading investors into believing that Dfinity and its insiders would not — and could not — sell their ICP tokens.
This allegation might not be the main cause of the continuous downward trend of the ICP token price index since its launch, but it must have brought some sort of cynicism around the project.
4. Projects Built on The ICP Platform
Low demand for governance (holders who vote on the future of the ICP network) and transaction fees have seriously triggered the sell-offs of ICP crypto, driving the price down. This low demand is a result of fewer projects being built on the platform.
5. Poor Marketing and Partnerships
ICP token is partnered with several companies, yet there is little evidence that any of them are using the product.
The website does have a list of existing partnerships, but it doesn’t explain how those companies are utilising ICP token. The partnerships section of the website is vague and doesn’t explain how any of these companies are benefitting from their partnership with ICP token.
6. Competition from other Platforms
Most projects are usually built on major alternative blockchain platforms like Ethereum, making it difficult for ICP to attract newer and larger projects.
For Internet Computer Protocol to remain relevant in the crypto community, it has to attract these projects to increase the demand for the token, but the current bearish situation of the crypto market will make it insanely tough for that to happen.
Internet Computer Price Prediction
Since the launch of ICP crypto in May 2021, the price of the coin has consistently dropped in value only rising intermittently. It opened at a high of $750 on May 10 losing instantly over $50 of its value the next day.
The price fell sharply a week later on May 19 to $100 after a major cryptocurrency market sell-off. It is currently trending at its lowest value of just $4.
Even the recent news of ICP’s direct integration with the Bitcoin network to enable quicker delivery of smart contracts leveraging the use of the world’s largest cryptocurrency hasn’t pushed up the price point.
The outlook of ICP crypto isn’t looking favourable based on the trend of the price above. According to Wallet Investor, an algorithm-based forecasting service, the price of ICP will continue on a bearish path, possibly trading as low as $0.6 by the end of the year and $0.3 by October 2027.
On the flip side, the website also predicted that the price of ICP cryptocurrency could rise to $0.6 by the end of 2023 and $0.7 by the end of 2025.
Also, the negative trend of the market at the moment (a trend not about to abate for the foreseeable future) will keep impacting badly on the price value of ICP.
According to Coincodex, a cryptocurrency data-tracking platform, the short-term outlook for ICP will continue to remain bearish as the price is expected to drop by 5 per cent and reach 43,56 by December 23, 2022. This outlook is based on 21 technical analysis indicators that show a bearish signal against 4 indicators which show a bullish signal.
Even worse, Gov Capital, another cryptocurrency analysis platform, predicted that the price of ICP token will virtually plummet to zero in a year.
But other data-tracking platforms have forecasted a more bullish outlook for ICP. DigitalcoinPrice predicts that the price of ICP crypto will reach $4.6 by the end of the year, $9.6 by 2023, $13.4 in 2024, $17 in 2025, $20 in 2027 and as high as $72.4 in 2030.
Tradingbeasts are optimistic as well with their price prediction of ICP. The trading platform forecast the cryptocurrency to reach $10 by the end of 2023 and $14 by the end of 2025.
These price predictions and analysis above put ICP crypto as a potentially bad investment both in the short and long term.
But the ICP cryptocurrency could potentially go upward if the crypto market suddenly makes a bullish run.
Note: It is important to do your research if you have plans in investing in ICP crypto or any tokens as the cryptocurrency market remains extremely volatile. Therefore, you should always follow the popular maxim that says only invest money you can afford to lose.
Internet Computer Price Movement
ICP achieved all-time highs on the day of its debut, rising to over $750 and ranked third in terms of market size among all cryptocurrencies. Within a few days, it had dropped to a little over $100. It ultimately hit $50 and remained there for several months. ICP fell further toward the end of 2022 and into the first half of 2022, hitting a low of roughly $6 in May 2022.
Its price point is currently trending around the $4 mark as of the time of writing this article.
As we can conclude now in 2023, the ICP highest price by the end of 2022 was $4.12, and it is still raising in 2023. In January 18, it was $5.45 according to Coincodex, and if the price growth maintains the same trend, the figure will be quite impressive by the end of the year. But do not hope just for the best outcome, because the market is very volatile, and the price could fall again, as we have seen in 2022. But we can already say that the situation is improving and the price began to go up in January, 2023.
But this isn’t the only trigger causing the fall of ICP as some other factors are much at play. In this article, we take a look at the five reasons why the price of ICP token is falling.
Before we get to the ‘whys’, let’s touch on the ‘what’, “how’ and ‘who’.
What is ICP Crypto?
The cryptocurrency space is crowded with diverse projects that aim to solve teething challenges faced by centralised platforms, not least the Internet Computer Protocol, to revolutionise the internet.
ICP crypto is a set of protocols that bands together independent data cloud centres creating an alternative to current centralised internet cloud providers like Google Cloud, Amazon Web Services and Microsoft.
The ICP token does two things; governance and transaction fees. For governance, the token can be used to cast votes on proposals to give the community a say in which direction the project goes.
For transaction fees, ICP can be used to cover the costs of smart contract deployment and data storage.
How does ICP Crypto Work?
The ICP project is at the core of Web 3; a completely decentralised world wide web. The project main’s objective is to wrestle control of the internet from the aforementioned big tech companies and place it on the users.
But how can this be achieved? ICP crypto allows developers to build and host web applications in a much more decentralised format without running them through dedicated servers owned by Google, Microsoft or Azure.
The applications or software built by developers will have no fixed server to be hosted on but will bounce around different independent computers that will serve as data centres.
This means that applications and software will be built by anonymous organisations or individuals and hosted on no particular server unlike apps created on known servers like Google cloud.
Who Developed the Internet Computer?
ICP was developed by Dfinity Foundation, a not-for-profit organisation whose main office is based in Zurich, Switzerland. The foundation was founded by Dominic William, a fierce proponent of a free-for-all internet. As stated earlier in this article, the project is built around the concept of peer-to-peer services and anonymised networks similar to the concept behind cryptocurrency.
Dfinity raised $102 million in a cryptocurrency token sale in 2018, valuing the network at $2 billion. Andreessen Horowitz and Polychain Capital, both major Silicon Valley venture capital firms, are among the investors.
Already, some popular applications have been replicated on the Internet Computer protocol by developers; examples of such applications include Cancan, a TikTok clone and LinkedUP (no guess what replica that is), both built using the Internet Computer protocol source codes.
Now to the reasons ICP crypto has fallen in price since its launch last year.
Enough reasons, outlined in this article, have been ascribed to the continuous fall of ICP crypto, but none is as pertinent as the current bearish mood of the crypto market which has put off a lot of investors. The longer the market continues trending downward, the less likely the ICP crypto will recover.
Updated on 01/25/2023: added news about the ICP price in 2023.
Should I Invest In ICP?
Investing in some assets, such as ICP, is a personal decision you must make based on your unique circumstances, risk appetite, and trading experience. You should always conduct your research to make educated trading decisions and never invest money you cannot afford to lose.
Is ICP a Good Investment?
This answer is not straightforward. Generally, it is advised you buy during the dip as currently experienced. But, as you must have read above, ICP price prediction by major crypto analysis platforms like Coin Codex and Gov Capital, investing in ICP crypto will be termed as a bad investment. While for platforms like Digitalcoin Price and Trading Beasts, investing in the coin right now produce a favourable outcome in the long run.
Will ICP Ever Go Back Up?
Again, this is not an easy question as a lot is based on different variables, not least the movement of the crypto market which is currently bearish. More importantly, the prospect of reaching its previous highest price mark depends greatly on the ability of the platform to attract more projects from developers and web 3 hopefuls.