What's Going on with all the Dissolved ICP?

There's a lot of dissolved ICP sitting on the NNS...

As of 23NOV21 100.1M ICP is sitting dissolved in neurons; this is more than 20% of the total supply.  It’s interesting behavior to leave ICP in a completely dissolved neuron and understanding when these ICP tokens move provides insight into the ICP token market.  Let’s explore…

Unknown Genesis Neurons

The vast majority, 66.9M ICP, are from unknown genesis neurons.  Neurons 1000-1141 still have 65.4M ICP in them, down from the original 71M they originally had.  We don’t know who owns these neurons, but they seem to be pulling ICP from the upper range neurons (1130-1141) while keeping the lower range untouched.  The account numbers for these neurons are unknown, so we are unable to track down the movement of ICP out of these neurons, which would be useful for understanding the purpose of these neurons and for anticipating future ICP movements out of these neurons.  Neurons 4001-4007 are also unknown genesis neurons that have dissolved and they have 1.5M ICP in them, out of an initial allotment of 28.8M.  These neurons are believed to be owned by Dfinity for the purpose of providing equity to employees per employment contracts.  This is backed up by the fact that some of the ICP that left these neurons ended up being re-staked in new neurons (often in 8-year neurons) and by the fact that neurons 4001-4007 have common accounts that ICP gets moved into.  The bulk of the 1.5M ICP in these neurons are in neuron 4007, with a few thousand left over in 4001-4006.  It seems likely that the remaining 1.4M ICP in neuron 4007 will be liquidated within the next few weeks.

ICA

The Internet Computer Association has neurons 3005 – 3039 with a total of 16.8M ICP dissolved.  The ICA also has neurons 3000-3004, which have 2.5M ICP in them, but these neurons are locked for 8 years.  The ICA has only moved ICP out of neurons 3005 (~400k ICP moved out) and 3006 (~300k).  The ~700k ICP that the ICA has moved has all ended up on an exchange (Huboi).  It was all moved in the months of May and June, with no additional movements since.

Seed and Early Contributors

Seed round and early contributors have 3.1M ICP in dissolved neurons.  The early contributor neurons (which make up 1.1M of the 3.1M) all have either 16604 ICP or 1660 ICP (the original staked amount) which suggests that these are neurons in which the owner has yet to interact with the neuron (either for KYC reasons or technical reasons).  It’s possible that the 1.1M ICP in these neurons may always remain dissolved and never moved.  For seed round investors, the amount of ICP in each neuron is inconsistent, however there are many cases where the same amount shows up 2-5 times.  This suggests that some of the dissolved ICP belongs to people who have never interacted with their neurons (similar to the early contributors) and suggests cases where the owner has moved all of the ICP from some of their neurons, but not all (let’s call these lazy seed investors since they only occasionally interact with their neurons).  In either case, it seems that when a seed round investor interacts with a dissolved neuron, they choose to move all the ICP at one time.

Non-Genesis Neurons

There are of course non-genesis neurons that have dissolved and still have their ICP in the neuron.  Most of these are reward neurons with small amounts of ICP.  However, there are 8 neurons with 13.1M ICP.  Given the roundness of these staked amounts and their size, it seems likely that these neurons were created from ICP dissolved from a genesis account, that was then staked in a new neuron with a very short dissolve delay.  The ICP then never moved after those neurons dissolved.  I’ll leave it to the community to speculate as to the purpose of this strange behavior or to speculate which genesis neurons produced this ICP.