ICP to add 20% revenue burn in new tokenomics shift
ICP adds 20% revenue-funded burns and usage-based node rewards to align supply with demand.
- 80% of Internet Computer cloud engine revenue will go to node providers, while 20% will buy and burn ICP, creating a usage-linked supply reduction.
- Node providers will shift from fixed subsidies to compensation tied directly to compute demand, aligning incentives with real network activity.
- The updated model mirrors other compute-focused chains that use fee-funded burns and demand-driven payouts to reward infrastructure and curb token inflation.
The DFINITY Foundation announced plans to update Internet Computer’s tokenomics to include a burn mechanism funded by network revenue, according to a statement from the organization.
Under the new model, 80% of revenue generated by Internet Computer cloud engines will be distributed to node providers operating the infrastructure, while the remaining 20% will be used to purchase and burn ICP tokens, the foundation stated. Node provider associations have begun preparations to market cloud engines, according to the announcement.
The current system provides node providers with fixed payments for maintaining network operations regardless of workload demand. The updated structure will tie node compensation directly to usage-driven revenue from compute services, linking incentives to actual network activity, the foundation said.
The change represents a shift from a fixed-subsidy model toward a usage-based economic framework for the Internet Computer network, according to DFINITY.
The revenue allocation directs a portion of funds to token burns, creating a demand-linked supply reduction mechanism as network adoption increases. The majority of revenue will flow to infrastructure operators to incentivize capacity provision and service reliability, the foundation stated.
Similar usage-based token economic models have been implemented in other compute-oriented blockchain networks, industry observers noted.
The transition aligns network incentives with usage while introducing a structural supply reduction mechanism tied to adoption levels, according to the foundation’s announcement.
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