What is Icon (ICX)?
Icon ICX is a protocol that’s trying to achieve something different than most other blockchains. Rather than marketing itself simply as another medium of exchange or smart contract platform, Icon’s goal is to become a connecting hub between different protocols.
Similar to Polkadot and Cosmos, Icon wants to connect blockchains and other digital systems to create a large, interoperable network. They are betting that the Icon network’s superior technology and talented development team will give them a chance to become the dominant hub of the cryptocurrency ecosystem.
The Icon Blockchain
Icon’s goal is to become the hub for a new digital economy. In the Icon community this is often referred to as a “digital nation.” Even though Icon’s primary use case is connecting blockchains, the goal of interconnectivity doesn’t just stop with crypto.
The Icon ICX network can also be used to connect businesses, tokenize contracts, transfer tokenized securities, store digital deeds, keep track of loans, transfer all sorts of digital currencies, make payments and store business records.
Ultimately the Icon network could become a series of connections between various blockchains and hundreds or thousands of non-blockchain computer systems. At the center of the network is Icon, specifically the P-Reps and Citizen nodes.
P-Rep stands for public representative. P-Reps have the opportunity to vote on governance decisions that affect the day to day operations of the Icon blockchain. P-Reps are also responsible for validating transactions on the Icon blockchain.
Every node that’s not a P-Rep is a citizen node. Citizen nodes cannot vote on governance decisions in the protocol, nor can they validate transactions. The primary purpose of a citizen node is to allow a user to initiate transactions or to use decentralized applications on the Icon blockchain.
A unique consensus mechanism secures the Icon ICX blockchain. Icon uses a LFT (Loop Fault Tolerance) protocol, which is based on a modified BFT (Byzantine Fault Tolerant) algorithm. We won’t go into the LFT protocol’s technical specifics here, but a full explanation is available on the Icon Medium page.
There are two main advantages of the LFT protocol,
- By using trusted nodes, LFT can reach consensus very quickly. The Icon ICX blockchain can scale to approximately 9,000 TPS.
- LFT allows the Icon network to reach fast finality while also making it impossible for the network to fork.
Similar to Delegated Proof of Stake, Icon users can stake their coins for a chance to validate blocks and earn the block reward. One of LFT’s advantages is that it can use spinning to come to consensus faster than DPOS.
What Icon ICX Does Well
There are several features that set Icon ICX apart from other blockchains. For example, the development team is continually improving the protocol and adding new features to the Icon coin.
The Icon ICX developers launched the Gangnam testnet in October of 2020. The testnet can be used to build out and implement new technologies without breaking the main chain. Once the developers are satisfied that everything is working, they will launch Icon 2.0. The Icon 2.0 chain will further expand Icon’s interoperability features as it will allow Icon users to connect to other blockchains like Ethereum.
This will represent the largest upgrade to the Icon network to date, not unlike the Ethereum 2.0 upgrade. The full Icon ICX development roadmap is available on Icon’s Medium page.
One of the problems with Ethereum is that developers who want to build on top of it have to learn a new programming language. All Ethereum smart contracts are written in Solidity, which is not an especially common language to code in.
Developers on Icon have more flexibility because they can code smart contracts in Python. Since Python is a common coding language, it’s easier for new users to create smart contracts on Icon ICX.
The ICX Token
ICX’s primary use case is to function as a value transfer mechanism on the Icon network. It’s similar to ETH on the Ethereum network. Users can send each other ICX and use ICX to pay transaction fees.
The ICX coin is also used for staking and to pay stakers a block reward. The current staking reward is 11.8%, although this can change at any time. Up to date staking reward information is available here.
After Icon 2.0, the team intend to start work on cross chain DeFi, so ICX will likely have more use cases here as a collateral and settlement token.
The Future for Icon ICX
While many ICOs have come and gone, Icon has proven itself to be a project with a long-lasting vision and the right team to make that vision a reality.
They will likely face stiff competition from projects with similar aims such as Cosmos and Polkadot however, both of whom are showing significantly more on-chain activity than Icon at the time of press. The Icon network currently hosts 13 DApps, of which 3 only appear to show any activity:
But whilst many more projects are being built on Polkadot, the project is also still at a nascent stage, so it can’t be said that the battle to be the no.1 interoperable blockchain is over yet.
The Icon ICX developers are continually improving the protocol and 2021 could still come good for the project if they manage to make headway on their goals and bring in some real user adoption.
Anyone who wishes to learn more about Icon can read the whitepaper, or check out the Icon website.
This content is for informational purposes only and is not investment advice. You should consult a qualified licensed advisor before engaging in any transaction.