The Internet Computer Protocol (ICP) ecosystem is witnessing significant activity, with notable drops in exchange-held supply and increasing accumulation trends. Recent data highlights a fascinating interplay of metrics, indicators, and market behaviours, suggesting potential long-term bullish signals for ICP enthusiasts.
Exchange Supply Dynamics
Since early December, the supply of ICP on exchanges has seen a marked decline. While short-term price correlation remains tenuous, historical data for Bitcoin underscores how dwindling exchange supplies can lead to price appreciation over time. The current ICP exchange supply is notably less than 10% of its circulating total, a smaller proportion compared to Bitcoin, which hovers around 12-13%.
The trend mirrors Bitcoin’s trajectory, where exchange-held supply has dropped significantly—from over three million to less than 2.5 million coins within a year—indicating increasing scarcity. Similarly, ICP is showing a steady accumulation pattern, with both retail and large-scale investors withdrawing coins for cold storage.
Growth in Address Activity
Active addresses within the ICP network have been steadily rising since October. Peaks aside, the trend points towards broader engagement, with more than 4,700 new addresses created on December 24th alone. This growth isn’t limited to casual users; addresses holding significant ICP balances are also on the rise.
- Addresses with 10+ ICP: Surpassed 100,000, up by 15,000 since May.
- Addresses with 100+ ICP: Continues to climb, indicating mid-level accumulation.
- Whale Addresses (10,000+ ICP): Near all-time highs, reflecting steady confidence among major holders.
Smaller holders (planktons, shrimps, crabs) and mid-tier investors (fish, dolphins) are also accumulating, further reinforcing the positive trend.
Revenue and Burn Metrics
ICP’s revenue metrics are a standout success story, with quarterly fees skyrocketing by over 50 times year-on-year. From a modest $75,000 in Q4 2023 to nearly $4 million in Q4 2024, the network’s fee generation is accelerating as demand for computation grows.
Burn activity—a critical indicator of deflationary pressure—also reveals a promising trajectory. After a significant spike earlier this year, weekly burns have stabilised at a higher baseline, suggesting consistent demand for network services.
Comparing Ecosystem Performance
When comparing ICP to competitors like Avalanche and Near Protocol, ICP demonstrates superior revenue generation relative to its market cap. December’s revenue for ICP stood at $1.8 million, outpacing Avalanche ($1.7 million) and Near Protocol ($858,000), even though both competitors have larger market caps.
Challenges and the Road Ahead
Despite these promising metrics, challenges remain. The total value locked (TVL) for ICP has increased 20 times since 2023, but this figure still lags behind expectations. Sentiment around altcoins remains neutral, and price action for ICP has been relatively lacklustre.
That said, ICP’s unique tokenomics, which align with its increasing demand for computational services, present a compelling case for long-term growth. As the network continues to expand its use cases, including artificial intelligence integration and large-scale decentralised applications, the fundamentals suggest a bright future.
The Bigger Picture
The boredom permeating the altcoin market doesn’t reflect the underlying momentum within the ICP ecosystem. With whales, retail investors, and mid-tier holders all actively accumulating, and with revenue metrics showcasing consistent growth, ICP’s prospects look robust for 2025 and beyond.
Investors seeking undervalued opportunities may find ICP to be an enticing choice as it positions itself for the next wave of market enthusiasm.
