First of all, I would like to state that ICON having an EVM compatible side-chain is probably the best strategic move, it is also way overdue and should have been implemented from very early on, so we could have been in a position where projects like Matic/Polygon are now.
For those who don’t know, $ICX is the governance token for ICE blockchain, but transaction fees for the blockchain are paid in a new currency called $ICE.
This is an utterly useless case, not only does this not make sense because it does not seem to be collateral for POS nodes, but it reduces the demand on $ICX. I imagine ICE blockchain will be a lot more active than ICON due to the ease of solidity dapps being forked on to ICE, rather than having to compile contracts on to the main chain.
Take AVAX for example, it has 3 chains, which all use the same token $AVAX - even if wrapping is needed.
This is the same example that ICON should be following to put more demand and usage on $ICX token, by making wrapped $ICX (through BTP) the native token of ICE, rather than creating two tokens.
If this is not the case, I hope someone can fork ICE and alter it to make BTP wrapped $ICX the native token.
This is something that I considered as well. There is one significant issue that led to the creation of ICE imo. Incentives for network participants on ICE.
To do what you suggested, it would require more inflation (or some allocation of current inflation) from the ICON Network to pay nodes operating the ICE network and stakers on the ICE network and the necessity to overcome significant technical complexities.
How would the inflation on the ICE network function? What percentage of ICX inflation (minted on the ICON Network) would go to ICE nodes vs ICON nodes, ICE voters vs ICON voters? How would the ICON Network know the state of the ICE Network after each block? How would the ICE Network communicate changes in staking/votes to the ICON Network in order to properly reward stakers/nodes? What would happen to ICE nodes/voters if BTP were to go offline temporarily? Not poking you for answers, but giving examples of questions that are not quite possible to overcome.
These are all major technical and economical hurdles with no precedents. The planning, analysis and development of this process/economic system would add considerably more time to bring to production. Given that there’s a debatable marginal benefit to even going down this route, the technical and economic hurdles are reason enough not to pursue it. I am sure the ICE team will come up with economics that benefit both ICE and ICX, and to be clear, I am not on the ICE team and don’t contribute to that project.
Thank you for the response. I do not feel that you are poking and discussion is great.
Is it not technologically possible to have Icon nodes run ICE? If so, I wouldn’t disagree with a little more inflation (~0.5) for ICON nodes to cover bloatage of ICE network. This inflation would be off-put by the increased demand of ICX and could be further off-put by burning tx fees.
If BTP were to go off temporarily, I wouldn’t see that as a big issue, AVAX has bridge issues constantly and is a centralised bridge. Secondly, we should be thinking futuristically and the plan should cover ICE to be some sort of ‘commit-chain’ or a L2 to icon, so that we could escape ICE on to ICON without having to rely on ICE. So $ICX being stuck in ICE shouldn’t be an issue in the long run.
Bearing in mind, that ICE is governed by ICX, a lot of these points should not be an issue?
I tend to agree with the points both of you are making. Just a few thoughts:
Assuming that the value of ICX will be split into two different tokens ICX and ICE (let’s say a single token ICX will have a market cap of 3B vs separate ICX and ICE tokens that will have a market cap of 1.5B each) then there’s no difference between having a single ICX with 5% inflation and having two separate tokens with 5% each (meaning: the value of inflation in $ terms would be the same in both cases).
I think Arbitrum and Optimism rollups on Ethereum do that (they are separate execution chains with each having their own nodes and are currently using ETH as their gas).
giving ICX double inflation is wrong IMHO, it just devalues the token, even if everyone get the same ratio. We do not have the activity right now to do this.
However, we could have increased inflation less than 1% to pay node operators of ICON to secure ICE (if technically possible)
ICE is not a rollup, it is a sidechain that has its own security (I guess?) but yes, wrapped ICX could have been used as its gas.