The Internet Computer (ICP) token is showing market growth for the third consecutive day, mainly due to the increased token burn cycle.
Significance of ICP Burn Cycle
The ICP token has reached an intraday high of $12, significantly above last month's low of $8.83. A likely reason for this surge is the latest data showing that ICP's burn cycle continues to rise. The burn rate has jumped over 8,800% year on year. The cycle burn rate now stands at over 849 billion cycles, surpassing the 90-day average of 512 billion.
State of Internet Computer Ecosystem
Data shows a record high in the number of canisters (smart contracts) in the Internet Computer protocol, reaching 879,670. This is a significant increase from 374,000 during the same period last year. However, the growth of ICP's ecosystem has recently stalled. According to DeFi Llama, the network has only 11 decentralized finance apps with a total value locked of just over $52 million, making it much smaller than other popular chains like Base and Sui. Chain-Key Bitcoin, the digital twin of Bitcoin on the Internet Computer, is also struggling to gain traction.
ICP Price Analysis
The daily chart shows that the ICP token has bounced back after hitting a low of $8.83 in December. It has broken above the critical resistance level at $10.97, the highest point from July last year. ICP has moved above the 50-day and 200-day Exponential Moving Averages, indicating that bulls are gaining momentum. The token has broken through the key resistance level at $11.60 and is likely to continue rising towards the next major resistance at $15.58.
ICP is showing an upward trend due to the increased token burn cycle and a steady increase in the number of canisters, though the growth of the current ecosystem is slowing down. Price analysis indicates the token might continue rising towards the next key level.
