Internet Computer (ICP) Struggles With Adoption Amid Proposed Tokenomics Overhaul and Market Volatility

Internet Computer (ICP) has experienced a sharp decline in value, trading at around $2.52 despite a recent 10.22% one-day price rally. Concerns persist over the project's lack of developer adoption, weak total value locked, and ongoing credibility issues following past legal disputes. A proposed tokenomics overhaul aims to reduce annual inflation by 70% but faces criticism for potentially driving away users due to higher onchain compute costs.

Internet Computer (ICP) has faced continued struggles in regaining market traction and developer interest since its high-profile launch in 2021. Once reaching a peak of $461.65, the token has since dropped over 90%, trading at approximately $2.52 as of early 2026. This decline has been attributed to a lack of transparency, legal issues, and failed expectations around its promise to reshape the internet as a decentralized cloud.

Recent on-chain price activity revealed a 10.22% one-day surge, bringing ICP to $2.50, but the price remains below all major moving averages and is still in an oversold state according to technical indicators like RSI and Stochastic oscillators. Analysts are divided on whether this represents a temporary bounce or a sign of potential consolidation.

In an effort to address ongoing challenges, ICP founder Dominic Williams proposed a tokenomics overhaul in a paper titled "Mission 70." The plan aims to cut network inflation by 70% this year through reduced node and governance rewards and a 5x increase in onchain compute costs. While some community members support the move toward a deflationary model, critics warn the changes could deter developers and users.

What Is Driving Internet Computer's Recent Price Movements?

Internet Computer (ICP) saw a short-term price rally amid bearish technical indicators, but the broader market context remains challenging. The token has not seen significant fundamental improvements in developer activity or real-world adoption, which are key drivers for long-term value.

The rally was attributed to the token hitting oversold conditions, but analysts note the absence of major news or catalysts to sustain the momentum. The price remains below key technical levels, and the market is waiting for signs of stronger demand.

What Are the Key Risks in the Proposed Tokenomics Changes?

The tokenomics overhaul aims to shift the network from inflationary to deflationary, but this comes with potential trade-offs. Increasing onchain compute costs by 5x could make the platform less attractive to developers, reducing innovation and slowing network adoption.

Node operators and governance participants stand to see reduced rewards under the proposal, which may discourage participation in the network. The success of the overhaul will depend on balancing these changes with user affordability and long-term network sustainability.

What Is the Outlook for Internet Computer in 2026 and Beyond?

Analysts project a potential price of $25 by 2030 if ICP sees stronger adoption in cloud computing and benefits from favorable regulatory developments. However, the current environment remains bearish, with ICP trading far behind major competitors like Ethereum and Solana in terms of developer activity and locked value.

Institutional adoption and enterprise use cases will be crucial for ICP to justify higher valuations. Until then, the token is likely to remain range-bound or continue its downward trend without significant positive catalysts.

For investors, the key will be to monitor on-chain activity, developer engagement, and the progress of the tokenomics overhaul. A successful shift to a deflationary model may attract long-term holders, but the current environment remains highly uncertain for ICP.