Internet Computer (ICP) has surged approximately 39% in the past week, outperforming major cryptocurrencies such as Bitcoin and Ethereum. This significant gain follows the DFINITY Foundation's publication of a whitepaper that proposes to cut the token's inflation rate by 70% through supply-side reforms and increased network demand.
DFINITY Releases Inflation-Cutting Roadmap
The DFINITY team released the MISSION70 whitepaper on January 13, outlining a dual strategy aimed at reducing ICP token inflation from its current rate of 9.72% to approximately 2.92% by the end of 2026.
The proposed strategy includes supply-side measures that account for 44% of the planned reduction. These measures involve lowering voting rewards, reducing node provider payouts, capping reward pools, and simplifying maturity modulation mechanisms.
"We estimate that the supply-side measures reduce ICP minting from 9.72% (January 2026) to 5.42% (January 2027), a 44% reduction," the whitepaper states.
The whitepaper argues that current node provider rewards exceed the underlying infrastructure costs, creating an opportunity to implement cuts without compromising network security.
The remaining 26% reduction in inflation is contingent on increased network activity.
DFINITY plans to stimulate demand by fostering the development of AI-powered on-chain applications and new cloud engine products. These initiatives are expected to lead to more computational fees, which will, in turn, burn more ICP, creating deflationary pressure on the token.
On-Chain Data Shows Market Conviction
Data from Santiment confirms that ICP has led large-cap assets in market cap gains over the past week. The token experienced a significant climb, rising nearly 26% in the past 24 hours alone, positioning it at the top of the daily leaderboard among the top 100 cryptocurrencies.
On-chain metrics suggest that holders are increasingly positioning for longer-term exposure to ICP. Data indicates that ICP exchange balances have declined by more than 58% over the past 24 hours, a pattern that is typically associated with reduced selling pressure in the market.
Network usage has also seen a notable acceleration. Chainspect recorded approximately 90 million transactions in a single day, marking the Internet Computer's highest daily activity in over a month.