Ethereum<\/a>. The Internet Computer is comparable to the internet in that it is composed of a large number of distinct subnets that are able to communicate with one another. It is possible to expand its capacity indefinitely by adding additional subnets.<\/p>\nIn conclusion, the Internet Computer’s native on-chain governance system, known as the Network Nervous System, allows for simple upgrades and expansions of its capabilities (NNS). By staking ICP, the utility token for the Internet Computer, in voting neurons within the NNS, anyone is able to take part in the governance of this network. Token holders who take part in the event can submit proposals to either improve or expand the network. These upgrades take place invisibly and do not involve any disruptive hardforks; consequently, the Internet Computer is able to rapidly evolve and improve.<\/p>\n
The internet computer is made up of a wide variety of different parts, including subnets, nodes, canisters, the NNS, neurons, proposals, votes, ICP, and cycles. Let’s take a quick look at each component to help you get a better grasp on what the Internet Computer is composed of.<\/p>\n
\n- Subnets<\/strong>: A subnet is a specific group of nodes. Anything that runs on a particular subnet is replicated across one to many nodes in the subnet.<\/li>\n
- Nodes<\/strong>: A node is a single machine running somewhere in the world. Nodes combine their computing power and run the Internet Computer Protocol.<\/li>\n
- Canisters<\/strong>: A canister is where an application runs on a subnet (or group of nodes). This means the canister is the code, state, memory, and storage for Internet Computer applications.<\/li>\n
- The NNS<\/strong>: The Nervous Network System (NNS). This is a system of neurons, proposals, votes, ICP, and staking that governs the Internet Computer. By governance, I mean almost all changes to the internet computer have to go through the NNS in a proposal.<\/li>\n
- Neuron<\/strong>: A neuron may contain staked ICP. When ICP is staked and the dissolve delay is greater than 6 months, the neuron is a voting entity in the NNS.<\/li>\n
- Proposal<\/strong>: In order to change the Internet Computer in any way, you have to do it through a proposal to the NNS (there may be a few edge cases that do not require NNS proposals). The proposal will outline a specific change, and then everyone with staked ICP in neurons will vote on it to decide whether to adopt the change or not.<\/li>\n
- Votes<\/strong>: Each neuron receives voting power based on how much ICP is staked in it, how long the ICP has been staked in the neuron, and how long the ICP has to be locked away (also called dissolve delay). When a neuron votes on an NNS proposal it earns rewards.<\/li>\n
- ICP<\/strong>: The Internet Computer Protocol, ICP, is a utility token that can be purchased at common exchanges (Coinbase, Binance) and staked in a neuron to participate in the governance of the internet computer. You also receive rewards in ICP for staking and voting on NNS proposals.<\/li>\n
- Cycles<\/strong>: ICP can be converted into cycles. For example, 1 ICP might be worth 5 trillion cycles. This conversion rate always changes based on NNS proposals. A cycle is an operation performed by a computer, so cycles are a more granular form of compute costs. Canisters (see definition above) do computations on the Internet Computer and consume cycles to do those computations.<\/li>\n<\/ul>\n
What is the ICP token?<\/strong><\/h2>\nThere are many different applications for the ICP token. To begin, it is essential because it serves as the payment for computation in the form of cycles. It is possible to obtain one trillion cycles by converting one SDR worth of ICP. The IMF keeps a close eye on a stable basket of currencies known as the SDR. At the time of this writing, one can purchase one for approximately $1.42 USD. In order to cover the costs of computation, storage, and serving of web pages, cycles are burned. More ICP tokens are converted and burned whenever there is an increase in the number of applications that are hosted on the Internet Computer.<\/p>\n
The NNS is the location of the second application of ICP. To participate in voting and receive rewards for voting within the NNS, you will need to stake some of your ICP tokens in a neuron. When you vote, you will receive voting rewards in the form of freshly minted ICP tokens as a thank you for your participation.<\/p>\n
ICP tokens are also created and distributed as rewards to node providers as a final point. Because the tokens are turned into cycles and then burned, the total supply of ICP has a deflationary effect. On the other hand, the total supply of ICP is inflationary. On the other hand, it leads to inflation due to the fact that rewards are created for node providers and neurons.<\/p>\n[\/et_pb_text][et_pb_text _builder_version=”4.19.0″ _module_preset=”default” custom_margin=”||0px||false|false” global_colors_info=”{}” theme_builder_area=”post_content”]\n
What makes Internet Computer (ICP) unique?<\/strong><\/h2>\nOne of the biggest questions about any cryptocurrency is how it differs from any other crypto. Here are three ways that Internet Computer stands out from other players:<\/p>\n
\n- It allows anyone to create software on the internet.<\/strong>\u00a0The technology allows anyone to use its blockchain technology to create apps and lets them do an end-run around the big tech companies.<\/li>\n
- It runs on a decentralized network, not the cloud.<\/strong>\u00a0In contrast to many other blockchains that run on the cloud, Internet Computer runs on a dedicated hardware set up by independent parties, according to Dominic Williams, founder of Dfinity.<\/li>\n
- It\u2019s fast.\u00a0<\/strong>While completing transactions using some cryptocurrencies may take 30 minutes or more, Dfinity boasts that its crypto operates at web speed.<\/li>\n<\/ul>\n