Internet Computer price prediction: Can node rewards reform support ICP after sharp drop?

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Internet Computer drops 7.02% today

Highlights

DFINITY Foundation updated Internet Computer's economic model, allocating 80% of cloud engine revenue to node providers and burning 20% via ICP token reduction.
Node provider compensation now relies directly on service volume, linking network usage with ongoing ICP supply reduction and aiming to attract more enterprise adoption.
ICP trades at $2.12, well below resistance levels (MA-20 $2.41, MA-50 $3.02), with bearish momentum likely to confine price to the $1.90–$2.35 range near term.

Token burn and revenue shift as DFINITY overhauls incentive structure

The DFINITY Foundation has introduced a major update to Internet Computer's economic model, allocating 80% of cloud engine revenue to node providers based on performance, while 20% is set aside to burn ICP tokens. This change makes node provider compensation directly dependent on service volume, linking platform usage to ongoing ICP supply reduction and supporting long-term sustainability. The initiative aims to attract more enterprise adoption and strengthen the relationship between network activity and token value.

Bearish momentum strengthens as technical levels reinforce downside

Technical analysis confirms persistent bearish momentum, with ICP trading firmly below all relevant moving averages and encountering immediate resistance at the Ichimoku Kijun value of $2.70. Downside momentum is dominant, as the MACD signals a clear bearish bias and the ADX confirms sustained negative trends. Oscillators corroborate strong selling pressure with the RSI at 33.08, the Stochastic RSI and CCI both registering oversold conditions, and the Bull/Bear Power showing sellers clearly in control during intraday action. Intraday volatility remains elevated within today's $2.11–$2.22 range, reinforcing the outlook of ongoing bearish sentiment.

Lower move risk persists as volatility and bearish signals dominate

For the week ahead, ICP is expected to fluctuate within a $1.90–$2.35 volatility band relative to current levels. Given the dominant bearish signals across all momentum and trend indicators, the probability of a short-term rise is low (below 20%), while further declines remain more likely. The base scenario anticipates ICP moving sideways within this range; a break above $2.35 could pave the way for a test of resistance at $2.70, while a drop below $1.90 may lead to new short-term lows if selling intensifies.

Viktoras Karapetjanc, expert at Traders Union, notes that ICP remains technically weak as bearish pressure continues across all key momentum indicators. He sees the DFINITY Foundation's update as a promising shift toward sustainable tokenomics, potentially improving sentiment and laying the groundwork for future enterprise demand. However, the current setup suggests ICP is likely to remain under pressure in the short term, with only a modest chance of breaking resistance soon. Karapetjanc believes longer-term prospects could improve if supply reduction measures gain traction and usage grows. "ICP's outlook remains challenging for now, but policy changes supporting token burn and real-world adoption could set the stage for a constructive reversal in the medium term."

Previously it was reported that Internet Computer is exhibiting strong bearish momentum, trading well below all major moving averages with technical indicators such as MACD issuing a firm sell signal and RSI approaching oversold levels. The asset faces immediate support near $2.20, while ongoing negative sentiment and weak momentum increase the risk of a break below current volatility bands.

Source of Data: ICP Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.