The ICP ledger
The Internet Computer Protocol (ICP) implements management of its utility token (ticker "ICP") using a specialized canister, called the ledger canister. There is a single ledger canister which runs alongside other canisters on a special subnet of the Internet Computer - the NNS subnet. The ledger canister is a smart contract that holds accounts and transactions. These transactions either mint ICP tokens for accounts, transfer ICP tokens from one account to another, or burn ICP tokens, eliminating them from existence, e.g. while converting ICP tokens to cycles. The ledger canister maintains a traceable history of all transactions starting from its genesis state (initial state).
This section is structured as follows:
- This page provides an introduction to the basics of ICP and the ledger. For a more detailed explanation of the complete public interface of the ledger canister head over to the specification in the references section.
- ICP-Ledger local setup walks you through the steps to deploy a ledger canister to your local replica for development.
- Account trimming explains the mechanism to trim the dust accounts from the ledger.
An account belongs to and is controlled by the account owner who must be an Internet Computer (ICP) principal. No account can be owned by two or more ICP principals (no "joint accounts"). However, since a principal can refer to an external user as well as to a canister, joint accounts can be implemented as canisters.
An account owner may control more than one account. In this case, each account corresponds to a pair (account_owner, sub_account). The sub-account is an optional bitstring which helps distinguish between the different sub-accounts of the same owner.
An account on the ledger is identified by its
AccountIdentifier, which is derived from the principal ID and sub-account identifier.
In this context, you can think of principal identifiers as a rough equivalent to the hash of a user’s public key for Bitcoin or Ethereum. You use the corresponding secret key to sign messages and therefore authenticate to the ledger canister and operate on the principal’s account. Canisters can also have accounts in the ledger canister, in which case the address is derived from the canister’s principal.
The ledger canister is initialized using administrative operations that are internal to the Internet Computer. As part of the initialization process, the canister is created with the set of accounts and associated ICP token balances.
AccountIdentifiers and not just Principal IDs?
The main reason for introducing accounts was to allow a principal to control multiple accounts. While this could be abstracted away for a user by a the wallet software, this is not possible for canisters.
There are three operations that can change the internal state of the ledger canister:
Minting ICP tokens for accounts.
Transferring ICP tokens between accounts.
Burning ICP tokens.
All operations are recorded as transactions in the ledger canister.
The ledger maintains the transactions as a hashed blockchain, i.e., a blockchain running inside a canister smart contract (the ledger canister), which in turn is running on the NNS subnet blockchain.
As state changes are recorded, each new transaction is placed in a block and assigned a unique index. The entire chain is regularly authenticated by signing the latest chain link. The signature used to authenticate the chain can be verified by any third party who has access to the root public key of the Internet Computer. Specific transactions can be retrieved by querying the ledger.
Basic properties for ICP utility tokens
The ICP token is similar to utility tokens governing decentralized networks such as Bitcoin, but also differs in important ways.
The ICP token is similar to Bitcoin in the following ways:
Each ICP token is divisible 10^8 times.
All transactions are stored in the ledger starting with the genesis initial state.
Tokens are entirely fungible.
AccountIdentifiers are 32 bytes and are roughly the equivalent of the hash of a public key, optionally together with some additional sub-account specifier.
The ICP token differs from Bitcoin in the following ways:
Rather than using proof of work, staked participant nodes use a variant of threshold BLS signatures to agree on a valid state of the chain.
Any transaction can store an 8-byte memo — this memo field is used by the Rosetta API to store the nonce that distinguishes between transactions. However, other uses for the field are possible.