We recently released our $WTC canister where you can exchange native cycles by storing them in the canister and receiving WTC (1WTC per trillion cycles). Currently this canister is for testing purposes while we iron out any issues and finish adding features, but we have big plans in future.
Why do we need cycles?
Underneath it all, cycles are what run the Internet Computer. Everything from storage to computation on the IC consumes cycles — think ETH gas. The IC protocol has a built in method to mint cycles where you can exchange ICP tokens for these cycles. There will always exist a demand for these cycles as long as the IC exists in its current form.
Ok then that’s fine, but why do we need WTC then?
Cycles exist as the native “currency” built into the IC, but compared to tokens they are relatively hard to work with (i.e. to transfer between users). By wrapping these cycles as tokens we make them easily interoperable with wallets, exchanges and smart canisters.
This can allow for some really cool things — dapps can charge transaction fees in their own token which can be converted to WTC via an AMM and converted to cycles automatically.
Also, because the ICP to cycles conversion is one way developers may be stuck with an excess of cycles. WTC allows these to be traded and used as a stable coin.
That’s really cool, but what do you mean “stable coin”?
Now here’s the cool part — the exchange rate to mint cycles is 1XDR worth of ICP mints 1 trillion ICP cycles (TIC). XDR (or SDR) is an international reserve asset created by the IMF from a basket of currencies including the United States Dollar. At the time of writing, it is currently worth $1.44USD, and retains a relatively stable value.
Because there is constant demand for cycles, if the price of WTC were to fall below 1XDR then developers will choose to buy these to fuel their canisters as it is cheaper than minting cycles directly using ICP.
Conversely, buyers will stop buying above 1XDR as it is more affordable to mint ICP directly. This makes WTC a stable token backed by computation — pretty neat huh?
Ok this is really cool then, so what are the future plans?
As mentioned, we are currently testing and adding new features to WTC so it’s not in a state to be used as a stable token just yet. Feel free to test out the features if you wish though!
In the near future, we want to add transactions and integrate with explorers and more wallets. We are also working on ways to mint cycles (and therefore WTC) using ICP directly using our WTC Minter canister. This will make obtaining ICP stupidly easy.
Further down the track we’d love to see integrations with DEX’s, AMM’s and smart canisters in general. Having a stable coin backed by computation is just the beginning!
Any other questions away? Let us know below and we will get back to you!