What Is ICON (ICX)?

What Is ICON (ICX)?

Let me explain ICON to you directly: it's a platform built to make interactions between independent blockchains— what we call communities— straightforward and efficient. In this setup, a community is just a network of nodes operating under one governance system, where a node is simply a computer hooked into a cryptocurrency network.

You know how networks like Bitcoin or Ethereum function as communities? Well, ICON extends that to include banks, businesses, hospitals, schools, and even governments. The whole thing runs on a cryptocurrency token called ICX, and it was started in 2017 by the Icon Foundation out of South Korea.

My point here is that ICON's main aim is to build a platform where players from all sorts of fields— finance, security, insurance, healthcare, education, and commerce— can interact and handle transactions on one unified network.

Key Takeaways

Here's what you need to grasp: ICON is essentially a blockchain tech and network framework that lets separate blockchains talk to each other. These communities link up to the ICON Network via a decentralized exchange. But keep in mind, a big hurdle for ICON is pushback from those traditional centralized crypto exchanges.

Understanding ICON (ICX)

Back in September 2017, ICON held an initial coin offering for ICX that pulled in about $43 million, covering half of their token supply. They officially kicked off their blockchain in January 2018, and ICO participants got their ICX by June that year.

Then in 2019, they rolled out their own token standard, IRC16, which lets you use ICON's software to build your own tokenized assets and securities. These are digital tokens representing ownership in something, like equity shares, so businesses can raise funds by issuing digital versions of their stock.

ICON puts it this way: they're out to create a 'digital nation' where different economic players can issue and manage their own value under rules they choose. Their site says the goal is to 'hyperconnect the world' by building one of the biggest decentralized networks around.

They drew inspiration from real economies, where businesses, nonprofits, and governments all use a shared currency but stay distinct and interoperable. The ICX token and blockchain tech let participants in this decentralized system meet at a central point, forming an interconnected network.

You should know a blockchain is a database that stores data in chained blocks chronologically. It's not just for crypto; it can handle securities, contracts, deeds, loans, IP, or IDs— anything that involves exchanging information.

Historically, blockchains were isolated because each has its own network, but ICON is trying to bridge them. Unlike centralized systems that force their rules on everyone, ICON lets communities keep their own policies, which should make adoption easier.

Goals of ICON

ICON is pushing for a massive network of individual networks, all powered by cryptocurrencies. If you're part of a participating blockchain, you can swap currencies using their decentralized exchange (DEX).

The DEX holds reserves for each community, enabling real-time value exchanges. Rates get set by an AI model, and ICX acts as the go-between currency.

Breaking it down, ICON has five key parts: the ICON Republic, communities, community representatives (C-Reps), community nodes (C-Nodes), and citizen nodes. Communities are node networks with their own governance— they might be consensus-based like Bitcoin or hierarchical like a bank.

C-Nodes keep each community's blockchain running. C-Reps are elected from communities to link with the ICON Republic and get paid in ICX for it.

The ICON Republic governs the whole network, with decisions made by C-Rep votes. Think of it like the US federal government, with communities as states— it doesn't dictate community rules but handles new ICX minting.

Citizen nodes are regular participants without votes; they can transact within and across communities and the Republic.

The Republic's blockchain is the 'nexus,' powered by loopchain, which connects communities into a consortium with shared rules via the Blockchain Transmission Protocol (BTP).

Like Ethereum, you can build and use decentralized apps (DAPPs) on ICON's public channel, and they're available in their DAPP store for anyone with a citizen node.

Criticisms of ICON

ICON has big plans to link communities, but there are real challenges. Many investors stick to centralized exchanges, which go against crypto's decentralized ethos but dominate the market in 2021. If those exchanges avoid listing ICX because it threatens their model, that could hurt adoption.

Plus, the crypto space is crowded, so ICON risks getting lost in the competition from other coins.