Internet Computer’s Token Under Scrutiny as Criticisms Mount

Internet Computer Underperforms Amid Criticisms

Internet Computer’s token, ICP, remained stagnant on Friday despite a recent surge in the cryptocurrency market. Trading at $11.18, ICP is up 93% from its 2024 low but has failed to break out of its tight range. This stagnation is in contrast to other popular cryptocurrencies like Bitcoin and Ripple, which are hovering near their all-time highs.

Criticisms from a Prominent Crypto Researcher

Justin Bons, a well-known crypto researcher and hedge fund manager, recently criticized Internet Computer’s technology in a detailed thread. According to Bons, the Internet Computer network is highly centralized and insecure. He argued that the network’s dependence on at most 40 independent subnets, each responsible for its own security, is a major concern.

Bons also pointed out that Internet Computer openly lists the data center locations of its nodes, potentially exposing them to attacks. In his words:

ICP is centralized & insecure; ICP is dangerous! You can bring down ICP by only attacking 40 nodes in known & fixed data centers!

Scalability and Decentralization Concerns

Bons also criticized Internet Computer’s claim of having infinite scalability, arguing that the network’s scalability has limits since all subnets must communicate with one another. He believes that this limitation is a major issue, as scalability without decentralization is meaningless.

Oracle Problem and DeFi Applications

Another issue raised by Bons concerns ICP’s claim that it has solved the oracle problem using HTTP outcalls, which allow smart contracts to retrieve data from Web2 APIs. He believes that this approach is flawed because it relies on centralized tools. These criticisms may explain why Internet Computer has underperformed compared to other blockchains in the crypto industry.

ICP Price Analysis

The daily chart shows that Internet Computer’s price has risen slightly in recent days as most cryptocurrencies rebounded. ICP’s price increased after forming a double-bottom chart pattern at $9.33. A bullish breakout for ICP will be confirmed if the price moves above the double-bottom’s neckline at $12.72.

Tips for investors:

  • Keep a close eye on ICP’s price movement and wait for a confirmation of the bullish breakout.
  • Consider the criticisms raised by Bons and their potential impact on ICP’s price.
  • Stay informed about the latest developments in the cryptocurrency market and adjust your investment strategy accordingly.

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