What Is ICON?

According to its website, project ICON wants to “Hyperconnect the World” by “building one of the largest decentralized networks in the world.”

To do this, the team is building a massive platform that allows various blockchains to interact with each other via smart contracts.  Existing within what developers brand the ICON Republic, communities connect with each other using the projects loopchain technology.  The end game is to provide a platform where players from financial, security, insurance, healthcare, educational, and commerce industries and beyond can coexist and transact on a single network.

This project is aiming to be one of the largest decentralized networks in the world.

ICON has been in development for two years to date. It was founded by Dayli Financial Group, a Korean Fintech company valued at $4 billion that also owns the popular Korean exchange Coinone.

Let’s get into the thick of it, shall we?

Using its loopchain platform, ICON connects an ecosystem of blockchain communities through the ICON Republic. As the name suggests, the Republic functions as the governing head for a federation of otherwise independent blockchain bodies. You can picture the ICON Republic like the United States with each ICON community representing a state.

Communities are linked to the Republic at large through community representatives (C-Reps) that connect to Nexus, the loopchain-based blockchain that underpins the ICON Republic. C-Reps act as Portals for communities to interact with Nexus and, by extension, other communities through the ICON Republic. Blockchains that use ICON can exchange currencies using the platform’s decentralized exchange (DEX).

An illustrated example from the white paper showing how communities connect within the network via their C-Reps

Simply put, an ICON Community is an individual blockchain or protocol with its own governing system. Community Nodes (C-Nodes) comprise the infrastructure of each community. C-Nodes are responsible for governing and maintaining their respective community’s blockchain. Each community operates according to its own rules and own consensus algorithm, meaning the project itself has no control over how its community members conduct their programs outside of the ICON Republic.

Citizen Nodes are gateways for the average individual to connect to ICON’s network. You can use these nodes to create transactions and utilize DAPPs. But, they have no governing power in either their native blockchain’s community nor the ICON Republic at large.

C-Reps function as elected officials for their respective communities. Each community chooses their own representative, and each C-Rep is responsible for governing matters, such as transaction verification and otherwise, within the ICON Republic.  Like delegates in a DPoS system (see Ark), C-Reps receive compensation for their work in the form of ICX, the native currency.

A snip from the white paper showing the various connections in the network

Supported by loopchain, the ICON Republic is the hub that accommodates the individual communities that coexist on the platform.

While separate communities can follow their own consensus mechanisms, the ICON Republic runs on the Loop Fault Tolerance (LFT) consensus algorithm. LFT functions much like DPoS, wherein C-Reps act as delegates for their respective communities in ICON’s larger government. As representatives, C-Rep nodes are responsible for voting on ICON Republic’s currency issuance and reward policy, resolving transaction discrepancies on the DEX, and maintaining network integrity. Again, the ICON Republic functions solely as a communications channel for ICON communities, and the group of C-Reps that comprise it have no control over individual blockchain communities.

ICON sports its very own decentralized exchange. This DEX sets currency reserves for each blockchain community so that the communities can exchange value in real time through the ICON Republic. In this way, the DEX complements C-Rep portals by establishing another gateway for Communities to connect to the Republic.

Instead of the focus being on governance, as it is with C-Reps, the DEX’s focus is on value and currency transfer. The exchange enables transactions and trading across blockchain’s connected to the ICON Republic. And the DEX’s reserve sets exchange rates for these transactions using an A.I. analysis model. Additionally, the native ICX coin is used as an intermediary currency for this exchange.

UPDATE: As at November 2018, the DEX has not yet gone live. There is currently no available information on when this may happen. Similarly, there is no indication that it isn’t still planned for release at some future date. 

The ICO ended in October 2017 and exchanges began listing it at the tail-end of the same month. It’s now been around for over a year and consistently ranks among the top 50 coins on Coin Market Cap.

ICX coin value spiked in January 2017 when the mainnet went live, hitting its all-time high value of more than $12. Since the crypto market’s cooled off, it has generally followed a similar pattern to other cryptocurrencies. However, the value of ICX hit another spike in May, around the same time that news broke of an ICON partnership with Line Plus, Japan’s most popular messaging app. 

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Since then, ICON has seemingly flatlined, trading under $0.50 for the two months leading up to November 2018. The company ended its token swap in October, where you could exchange their initial ERC20 ICX tokens for the ones issued on the mainnet. 

Most recently, there was a sudden 18 percent increase of ICX tokens in circulation, leading to an outcry from the community about pumping. ICON addressed the issue by stating that the tokens were released as part of a planned vesting schedule. 

How the wallet works

Binance dominates ICON’s trading market, accounting for just over 60% of its 24/hr volume. It’s also possible to buy ICON on OKEx and Huobi. 

Since the 2018 token swap, it is no longer possible to store your ICX in an ERC20 wallet. The ICON team has now launched its own web, software, and Android wallet. Ledger wallets like the Ledger Nano S also support ICX. 

ICON’s team comes replete with individuals from across the business, A.I., engineering, blockchain, and marketing industries. Its advisors include Don Tapscott, a Canadian business executive who has built his career on fostering technological innovation and adoption, and Jason Best, a Forbes top 10 crowdfunding organizer. 

The company’s most recent hire is Ricky Dodds as Head of Institutional Markets and Contributor Relations. He joins with experience in the investment banking and equity research markets.

The project team has not published any formal roadmap since the summer of 2018, drawing criticism from members of the Reddit community. particularly given that some felt the token swap process was slow following the January mainnet launch. The team most recently issued a blog post addressing the fact that they needed to be more communicative. However, a formal roadmap is still unavailable. 

There are several other projects focused on finding a solution for blockchain interoperability, although ICON is currently ahead of them all in terms of ranking. Its closest competitors are currently AION and Wanchain with ARK not far behind. 

Two similar projects that have yet to launch their mainnets are Polkadot and Cosmos. It’s still unclear whether either of these projects will prove to be a serious competitor.

If this project can function as well in the real world as it does on paper, this network may very well be the skeleton key that unlocks blockchain interoperability and connects these services to existing industries. The project’s whitepaper hashes out how ICON would fit into established industries, including healthcare, education, business, insurance, capital markets, and so on.  

Individuals and entities could not only use ICON for data transfers and monetary transactions, but they could also use blockchain I.D. on the platform for identity verification and enhanced security measures.

That said, progress during this year has either been slow, or it has been limited to a lot of back-end updates to the mainnet that haven’t delivered any immediately obvious impacts to the overall case for adoption. While the project remains one of the more interesting in the space, and the value is holding up compared to other alts, whether it will achieve all its initial goals remains to be seen. 

Editor’s Note: This article was updated by Sarah Rothrie on November 15 2018 to reflect the recent changes of the project.

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