What is Cosmos Network: Guide to the ‘Internet of Blockchains’. The Cosmos Network enables distributed ledger communication without a central server. After the 2016 Cosmos white paper, the network was dubbed the Internet of Blockchains by its founders to facilitate interoperable transactions between open-source blockchains. Interoperability has been a challenge for developers since the advent of blockchain. Interoperability allows system communication. Imagine Gmail and Hotmail emails. An Android phone that can share data with iOS.
As with a blockchain, single structures are built first. Communication between systems is still important. Otherwise, they’re useless and may hinder technology uptake. The first open platform to facilitate interoperability between systems like Binance Chain, Terra, and Crypto.org, Cosmos manages over $151 billion in digital assets. Cosmos ATOM $7.17 is the cryptocurrency that secures and fuels a scalable, interoperable blockchain ecosystem.
How does Cosmos work?
The Cosmos network is a growing ecosystem of connected apps and services. Hubs, the Tendermint consensus algorithm, and the IBC protocol secure blockchain communication. Some platforms use intelligent contracts for communication. This procedure locks tokens on one platform and mints the asset’s amount on the other. Wrapped tokens are a classic example of this technique.
Instead of transferring $34,090 from Bitcoin to Ethereum, the BTC is stored on a working blockchain that performs the service. Wrapped Bitcoin (BTC) is released in pegged tokens on another blockchain. Cosmos provides open-source tools for developers to construct zones and decentralized blockchain applications instead of relying on one chain. Zones are Cosmos intelligent contracts.
With Cosmos’ SDK, developers can make zones faster, easier to get to, and less expensive than Ethereum. It uses well-known and straightforward software development platforms like GO to give the most common blockchain features, such as staking, governance, and tokens. Developers are free to make apps and add features however they want.
What problem does Cosmos solve?
The goal of Cosmos is to allow all blockchains to communicate with one another while also resolving the three primary issues plaguing blockchain technology today: sovereignty, scalability, and sustainability.
By using the open-source Cosmos SDK, programmers may create decentralized applications on the blockchain at no ongoing expense. High transaction costs due to network congestion can be avoided, and better scaling features can be developed if these blockchains can readily interact without requiring intelligent contracts to exist on a different blockchain. New financial technologies (DeFi), games, DAOs, social media, online marketplaces, and the internet-based economy will benefit, as will the ownership economy in which everyone has a say.
A scalable system can only do its job right if it can talk to other systems in the Cosmos. The Cosmos exchange model of shared standards for communication lets any sovereign blockchain speak to any other sovereign blockchain. It also allows each sovereign blockchain to help shape the future of its protocol design. Scalability can be reached in the Cosmos by copying a blockchain to reduce pressure or splitting the apps into many blockchains only used for those apps. The network works well because tokens can be moved between chains.
The PoS consensus method ensures the network is safe and will work in the long run. When compared to the PoW consensus method, PoS leaves 99% less of a carbon footprint.
Cosmos vs. Ethereum
Ethereum is not as stable as Cosmos because, even though developers have long pushed for a switch to PoS, the platform is still using a PoW consensus method. Even Ethereum has a big problem with being able to grow. It can take a few minutes to several hours for an Ethereum exchange to finish. Instead of Ethereum’s gas fees, which can get very expensive based on how busy the blockchain is, Cosmos Tendermint BFT proof-of-stake algorithms can handle thousands of transactions per second for much less.
Ethereum’s complex financial tools and the network are managed by smart contracts that don’t need permission and have specific functions. There is a blockchain for every Cosmos smart contract or program, ensuring transactions go smoothly.
The Cosmos system makes it easy for developers to create private blockchains quickly and cheaply. Its shared method lets blockchains talk to each other easily, which Ethereum doesn’t do without using sealed tokens, which are complex and insecure. Blockchains, on the other hand, are what Ethereum is most valuable for. It will likely stay the platform of choice for cutting-edge blockchain apps like DeFi, NFTs, and the Metaverse because it has such a significant effect on the network.
Cosmos vs. Polkadot
Even though Cosmos and Polkadot have similar regulations, they are very different in how they validate transactions and trade tokens for assets. Cosmos hub protocol mandates that the top 100 testers taking the most ATOM risk verify all transactions. As a delegate, you can change validators’ pools to stake tokens and get rewards. You can have a central hub with a different certification method for each zone, or each area can make its coin instead of ATOM.
At the same time, there can be both public and private safe blockchain zones, and it’s easy to move assets between them. Parachains work in Polkadot the same way that blockchain areas do in Cosmos. But they all use the identical validators. So, the network is safe and sound thanks to the Relay chain, the main blockchain. The Cosmos blockchains connected to a hub don’t have the same solid security.
While Polkadot’s smart contracts handle token transfers between parachains, Cosmos’ IBC makes it simple to exchange assets and communicate with other blockchains. Blockchains are essentially what Cosmos intelligent contracts are. This enables Cosmos to keep track of every exchange in three locations: the hub, the two zones that communicate, and a central database.
Who is behind Cosmos Crypto?
The progress made on Cosmos is the product of collaboration between many groups. The Tendermint team and the Swiss non-profit Interchain Foundation (ICF), which provides funding and support for open-source blockchain initiatives, contributed significantly to its creation. Cosmos was launched in 2014 by programmers Jae Kwon and Ethan Buchman. They also developed the consensus method known as Tendermint. In 2016, Kwon and Buchman published the Cosmos white paper, and in 2019, they made the corresponding software available to the public.
The ATOM token’s initial coin offering (ICO), held by the Interchain Foundation in 2017, raised nearly $17 million over two weeks. The 2019 Series A investment round for Tendermint Inc. brought in $9 million to keep the business moving forward. However, Jae Kwon promised to remain participating after leaving the project in early 2020. Ethan Buchman continues to serve as president of the Interchain Foundation Council. Several well-known cryptocurrency firms, such as Paradigm, Bain Capital, and 1confirmation, have put money into the Cosmos project.
Is Cosmos a good investment?
Since its beginning, ATOM’s value has increased significantly by around 600%. In September of 2021, ATOM hit its all-time high price of $38.78. While each zone can create and use digital money, ATOM is still the most widely used token throughout the Cosmos network. It keeps the network working and can be stored, spent, sent, or staked. As more and more nodes are added to the network and rely on ATOM’s safety. Transparency as a multiasset distributed ledger, the value of ATOM rises.
Cosmos users who own and stake ATOM not only get benefits but also have a voice in deciding whether updates to the network are implemented. Potential buyers of ATOM should note that there is no cap on the total supply. Instead, the amount of ATOM staked affects how many tokens Cosmos creates. Putting money into Cosmos (ATOM) is simple. The year 2019 marked the debut of the cryptocurrency on the market. All the major exchanges will facilitate purchases and sales of the token, so there’s no need to worry about where to buy cosmos crypto. There is a broad list of exchanges that provide this feature, including Coinbase, Binance, and Kraken.
To help keep the Cosmos economy and government stable, you need to stake ATOM units. As soon as you pick one or more Cosmos validation methods, you can start earning benefits in the form of cryptocurrency. This year, the average gain on ATOM staked is 9.7 per cent. It is common for users who risk 1000 ATOM to get 89.18 ATOM in rewards and 10.28% in commission.
Token holders receive staking rewards when Cosmos Hub charges transaction fees. Staking with numerous validators spreads risk if one fails. After betting, utilize your wallet to make a transaction without value or costs to get your winnings. None of the wallets support Cosmos—instead, various exchanges and crypto services support Cosmos’ networks and currencies. Web-based wallets include Exodus, Math Wallet, and Citadel One. ATOM can be sent, received, and stored with Ledger Live, Shapeshift, Trust, and others.
The Future of the Cosmos Network
The environment of Cosmos looks like it will do well in the future. The progress made by Interchain Security is expected to make security a lot better. This will make sure that all the chains that are linked are safer. IBC links will be more flexible, making it easier for DeFi transactions and NFT transfers between public and private blockchains.
Cosmos’ plans are ambitious and include many more features, but a dedicated team of developers backs the project so its participants can look forward optimistically.