Crypto enthusiasts opening CoinMarketCap today, May 11, 2021, to check the current state of affairs are likely to be shocked. Not because most crypto projects have fallen by a few percent, but because there was no unknown crypto project at number 5: The Internet Computer.
This cryptocurrency appeared out of nowhere and on day one managed to conquer a place in the top 10. “How?” I hear you think. There are several explanations for this, but a very important factor is the fact that The Internet Computer, also known as Dfinity, was listed on the largest exchanges on day one: Coinbase Pro and Binance.
That is quite an achievement in itself. After all, you are not just listed on these exchanges. That begs the question: what is The Internet Computer?
The Internet Computer was built by the non-profit organization DFINITY. DFINITY is a Swiss non-profit scientific research organization that oversees research centers around the world. DFINITY has locations in Japan, the United States and Germany.
DFINITY was founded in 2016 by CEO Dominic Williams. Dominic is a crypto theorist and entrepreneur. You can also call him a scientist, as he has several studies to his name and has proposed new ideas such as “The 3 E’s of Sybil Resistance”.
He also previously ran an MMO game that used his own blockchain system and housed millions of users. A real all-rounder.
The Internet Computer was founded and first announced in 2015, then conducted an ICO in 2018, raising a total of $ 195 million.
DFINITY’s mission is to build, promote and maintain The Internet Computer:
Our mission is to build The Internet Computer, thereby reinventing the Internet as a computer that hosts secure software with superpowers.
The team behind The Internet Computer consists of many of the world’s top cryptographers and experts in blockchains and programming language. Collectively, DFINITY contains nearly 100,000 academic citations and holds as many as 200 patents.
Currently, DFINITY has 189 employees, 3 research centers and the team regularly holds events where they give presentations about The Internet Computer.
What is The Internet Computer?
The Internet Computer (ICP), like any other smart contract platform such as Cardano (ADA), Polkadot (DOT) and Binance Smart Chain (BNB), is fighting against Ethereum (ETH).
Like all the aforementioned crypto projects, The Internet Computer is a layer 1 blockchain, or a first layer blockchain. This means that The Internet Computer has its own blockchain network with its own nodes that control the network. Many of the crypto projects you know are layer 2 projects that build on top of another blockchain. For example, Uniswap (UNI) is building on top of the Ethereum blockchain and PancakeSwap (CAKE) is building on top of the Binance Smart Chain.
The Internet Computer therefore describes itself as “The Last Layer 1 Blockchain”. The purpose of The Internet Computer is to extend the functionality of the public Internet by hosting the backend software. In non-developer language, this means that The Internet Computer wants to become a global computer platform on which developers can build.
Using The Internet Computer, developers can build not only Ethereum’s well-known dApps, but also websites, corporate IT systems, and Internet services, by installing their code directly on the public Internet. Developers no longer have to work with server computers and commercial, centralized cloud services.
The Internet Computer is an open-source crowd computing platform designed to transform the traditional Internet into a new, secure, decentralized Internet.
The Internet Computer therefore has a rather ambitious mission. DFINITY, the organization behind The Internet Computer, has developed ICP in such a way that it is able to ‘host’ a new, modern Internet, in which all kinds of applications run on The Internet Computer.
Competition with Big Tech
Big Tech companies such as Google, Microsoft and Facebook have enormous power today. The main purpose of such companies is to obtain a monopoly position. For example, Google has eand monopoly on internet advertising
The problem that The Internet Computer outlines is that the biggest players in Big Tech are so big that they oppose innovation. This is also called “Too big to fail”. DFINITY indicates that there are thousands of entrepreneurs around the world with fantastic internet services, but thanks to Big Tech, actually setting them up is almost impossible. In many of the cases, small internet services are bought directly by these Big Tech companies.
According to DFINITY, the problem stems from the fact that internet services share their data and functionality via APIs built by Big Tech companies. An example of this is Zynga, which was the largest social games company using Facebook’s APIs. One day when Facebook changed its rules to the detriment of Zynga, the company lost 85% of its value. The power that Facebook has in this example is what DFINITY wants to take away with The Internet Computer.
Due to this problem, many venture capitalists will not invest in smaller startups with services that rely on Big Tech’s APIs. After all, Big Tech can change course at any moment and push these startups to the abyss. Even if the startups have a unique, innovative and valuable idea, they can be capped by not being able to raise enough capital. This is not only a problem for these startups, but also for us, because innovation is prevented.
The Internet Computer addresses this problem by providing technology that supports the creation of a new kind of “open Internet service” that runs as part of the fabric of the unowned Internet. The Internet Computer can provide users with better guarantees about how their data is processed, as well as ensuring that developers can create permanent APIs that they can be assured will never be revoked or changed by a company.
This is partly due to the decentralized and immutable property of blockchain technology.
For example, with The Internet Computer’s software development kit, an open-source and decentralized equivalent of Facebook can be created that provides an API that other Internet startups can use, without having to worry about withdrawing or modifying the API.
An important goal of the Internet Computer is to redesign the most important internet services in an open source and decentralized form, so that monopolistic Big Tech companies no longer have control over your data.
The ultimate goal of The Internet Computer is to create a much more dynamic, collaborative, richer and ultimately more successful internet ecosystem.
How does The Internet Computer work?
Just like any other layer 1 crypto project, The Internet Computer’s network must be secured. Ethereum does this with the Proof of Work consensus algorithm and is in the process of moving to Proof of Stake.
The Internet Computer is based on a blockchain computer protocol called Internet Computer Protocol, which is also where the ticker ICP comes from. This protocol combines the collective computing power of a large number of nodes into a single computing platform capable of supporting applications of any scale and complexity.
The scalability of the network up to “web speed” is achieved by means of Chain Key Technology. This technique, currently only known from The Internet Computer, ensures that transactions on the network are completed within 2 seconds.