Cosmos (ATOM) and the Interoperability Solution
Cameron Tuths
Cosmos (ATOM) is a unique blockchain that strives to be the foundation for the future explosion in DeFi apps coming to market in this decade. Unlike other chains that focus on their decentralized economies, Cosmos instead works on being a central link between different blockchain networks. Cosmos is also innovative in this space as it incorporates a “plug and play” design, meaning that new DeFi apps can be quickly produced. These new individual decentralized economies can then be “plugged” into the Cosmos ecosystem that is connected with the larger crypto space such as Bitcoin and Ethereum. The Cosmos founders refer to their chain as the internet of blockchains because of this interoperability.
The only significant competitor to Cosmos is Polkadot, which tries to fix the interoperability difficulties currently plaguing DeFi. The difference between these chains is that Cosmos allows chains to maintain their sovereignty of independent blockchains. They must secure themselves, institute their governance, and operate their validators. The Cosmos system is complete with three layers of technology that will allow the chain to flourish as more DeFi apps build on the system.
Tendermint is a consensus technology that allows developers to form a quick, scalable, and secure proof-of-stake blockchain. Tendermint is an open-source software that can be used in decentralized networks like Cosmos to achieve Byzantine fault tolerance (BFT). In layman’s terms, BFT indicates that a decentralized network can continue to operate safely and reach consensus on its current state even if some of the actors involved in the process have failed or are malicious. BFT is considered extremely reliable, even in the event of a heavy workload on the blockchain. Terra and Ethermint are already running on this technology.
The Cosmos SDK enables developers to create blockchain-based apps using Tendermint. Using plug-ins, developers can complete the key functionalities of their projects in days rather than months. Consider it similar to a website builder. You can choose from a number of options, including staking, governance, and token details.
The Inter-Blockchain Communication Protocol (IBC) allows for connecting and communicating between different blockchains. The IBC enables independent blockchains to transact and exchange tokens along with other data. This allows for scaling and is vital in an interconnected network.
Users can make a passive income by staking their coins on a PoS network. You must stay in the top 100 stakers to be eligible to become a node in the Cosmos network. This technique is effective because it deters unscrupulous nodes, who stand to lose the most from any financial losses.
Governance Nodes now have the ability to vote while the amount of ATOM you staked determines your voting power. You can also delegate your tokens to other validators while still getting a piece of the block rewards.
Cosmos has announced several high-level upgrades for the entire ecosystem, including the Vega, Theta, Rho, Lambda, and Epsilon upgrades. Upgrades to the cross-chain bridge, Atomic Exchange, Privacy, Virtual Machine, Smart contract languages, and Rollups are all in the works.
Since the April 2017 ICO that brought in over $17 million in initial funding, the ATOM token has hit a high of $40 a token and has been hovering around $30 currently. As much of the cosmos ecosystem remains undiscovered, Atom has a lot of room for growth in terms of market cap and price. Blockchain technologies are entering the Cosmos ecosystem at a rapid pace, and this rate is only going to increase as we move towards a blockchain-driven financial future.
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Sources:
https://coinmarketcap.com/currencies/cosmos/
https://capital.com/cosmos-atom-price-prediction