Top Things You Should Know About Cosmos (ATOM)
Top Things You Should Know About Cosmos (ATOM)

By MuyAsk | Crypto Truth Lexicon | 2 Jun 2020


Hey guys :) I’m back with another comprehensive Q&A piece, this time for the innovative blockchain interoperability project – Cosmos (ATOM).

Cosmos is a cryptocurrency and blockchain project building blockchain infrastructure and protocols that enables an ecosystem of blockchains to scale and interoperate with each other. Cosmos is an incredibly interesting project with a lot of different facets to dig into.

That said, the following piece is a deep dive and is similar to my latest articles on Matic (MATIC), OmiseGO (OMG), and iExec (RLC), so if you haven’t already seen those, be sure to check them out as well. 

Hope you enjoy!

The list of Q&A is kind of long so first comes the list of questions that I have prepared the answers to:

  1. What is Cosmos?
  2. Who and When Created Cosmos?
  3. What Cosmos ATOM token is Used for?
  4. What is Tendermint? - https://cosmos.network/tools
  5. Who Builds on top of Cosmos?
  6. How Cosmos Competes with Ethereum? - https://cosmos.network/intro
  7. Is Cosmos Interoperable with other Blockchains?
  8. Where to Store Cosmos? (they recommend atomic wallet first on their list)
  9. Where to Buy & Sell Cosmos?

1. What is Cosmos?

de5a985786d1cdfd75c4a6ac604054e3a4718ab111c3ab83b00dd29dbb7ddf33.jpeg

Cosmos website homepage

Cosmos is a decentralized network of independent blockchains that can scale and interoperate with each other to create an ecosystem of blockchains. 

Through this interoperable ecosystem of blockchains, Cosmos aims to build the foundation of a new token economy by solving today’s hardest blockchain problems; ie. Scalability, Usability, and Interoperability.

Scalability
Cosmos is tackling blockchain scalability with an innovative consensus model called Tendermint – a byzantine fault tolerant (BFT) consensus engine that powers Cosmos Proof-of-Stake. 

All blockchains on Cosmos will be powered by BFT consensus algorithms like Tendermint and Cosmos Hub and its ATOM cryptocurrency is the first of thousands of interconnected blockchains that will comprise the Cosmos Network. 

Usability
Cosmos strives to make blockchain applications more simple and easy for developers to understand. It does this by providing developers with the Cosmos SDK (software development kit), which is a modular framework for building interoperable, application-specific blockchains.

Interoperability
Cosmos is bringing interoperability to the blockchain space through its proprietary Interblockchain Communication (IBC) protocol, which enables blockchains to communicate and transfer assets between each other. The IBC protocol is like a TCP/IP-like messaging protocol for blockchains.

The Vision of Cosmos

The end goal of Cosmos is to create an Internet of Blockchains – a network of blockchains able to communicate with each other in a decentralized way. 

Blockchains in the Cosmos Network will maintain sovereignty, process transactions quickly, and communicate with other blockchains in the ecosystem. 

Cosmos aims to make it easy for developers to build blockchains that can communicate and transact with one another in a secure and scalable fashion. 

2. Who and When Created Cosmos?

4a2fda8aadef31e86dec742d55ab1368c5f6f1ac61dda3db868a8d861009eaf8.jpeg

Tendermint website homepage

Cosmos was created by Tendermint Inc, a software development company spearheaded by its founder and CEO, Jae Kwon, and its co-founder and CTO, Ethan Buchman.

The history of Cosmos stretches back to 2014 when Jae Kwon became the first person to apply Byzantine Fault Tolerance (BFT) research in a "Proof of Stake" (PoS) public blockchain context. 

Later in 2015, Kwon went on to found Tendermint Inc. with Ethan Buchman and began developing and experimenting with the Tendermint consensus algorithm. 

Then, in 2016, Kwon and Buchman published the Cosmos whitepaper and established the Interchain Foundation (ICF) – a Swiss non-profit foundation that was formed to support the development of Cosmos and its ecosystem. Following the establishment of the ICF, the foundation raised $16.8M for the funding of the Cosmos Network in 2017.

Finally, after years of development and building out the Cosmos Network and its blockchain technologies, Cosmos Hub – the first Cosmos Network blockchain and its cryptocurrency ATOM – successfully launched on March 13, 2019. 

Now, going back to the creators of Cosmos:

Jae Kwon, the CEO, and founder of Tendermint is a tech entrepreneur who previously founded “I done this” a productivity app, and made multiple contributions to other projects including Scramble.io, Flywheel networks, and Yelp.

Ethan Buchman, the CTO, and co-founder of Tendermint has a Master’s degree from the University of Guelph and more than 2 years of experience as a research scientist. Now, Buchman serves as the Vice President of Interchain Foundation and is the CEO of Informal Systems, both of which organizations focus on blockchain technologies for the Cosmos Network.

3. What Cosmos ATOM token is Used for?

8e794a46d1c4d61e2fe97c9255453c9d76d79e5749ef5c14afaee0eeeab91d35.png

Cosmos (ATOM) token logo

Cosmos (ATOM) is the native cryptocurrency of the Cosmos Hub blockchain, which is the first and only blockchain in the Cosmos Network. 

The ATOM token has two use cases:

  • Staking 
  • Governance

Staking
The ATOM token is used as the staking token in the public Proof-of-Stake (PoS) Cosmos Hub blockchain. ATOM token holders can stake ATOM to contribute to the security and governance of the Cosmos Hub and earn ATOM tokens as a reward for their contribution. 

ATOM token holders can delegate their ATOM to one or more of the 100 validators on the Cosmos Hub blockchain. Staking ATOM tokens can be done through a variety of supported ATOM crypto wallets.

Governance
ATOM token holders can vote with their ATOM to influence the future of the Cosmos Hub blockchain through on-chain governance proposals. Anyone can participate in the governance of the Cosmos Hub through supported ATOM crypto wallets.

4. What is Tendermint? 

53dc86c3b7e1beb50f4fb18d2075f8abc91a1676bf5bf530e859877587b3f864.jpeg

Tendermint Core website homepage

Tendermint is a state-of-the-art byzantine fault tolerant (BFT) consensus engine that powers the Cosmos Hub blockchain and will power future blockchains in the Cosmos ecosystem. It’s software that can be securely and consistently replicated for a wide variety of applications on many machines. 

Tendermint Features

Byzantine-Fault Tolerant
Any good consensus mechanism must be byzantine-fault tolerant to uphold security and Tendermint Core can tolerate up to ⅓ of the machines it runs on failing arbitrarily. Even in the event of a machine acting maliciously, Tendermint Core can successfully achieve consensus. 

Language Agnostic
Tendermint Core uses the ABCI protocol, which supports state machines written in any programming language (ie. Erlang, Golang, Java, JavaScript, Ocaml, Rust, etc.). 

State Machine Replication
Tendermint Core can be replicated on deterministic state machines across the world.

Fast Finality
Tendermint Core features immediate transaction finality once the transaction is included in a block. There is no need to wait for confirmations, like in other blockchains such as Bitcoin and Ethereum. 

Tendermint Core Use Cases

  • Games
  • Decentralized Exchanges 
  • Identity Systems
  • Digital Rights
  • Property
  • Communication
  • Video
  • + More

5. Who Builds on top of Cosmos?

a7673d69deda14d357ab8ec891ab7226bea5cdfe4c11eff8abad1122122d005f.jpeg

(Source)

The following list of projects are actively building on the Cosmos ecosystem:

  • Binance Chain (DEX)
  • Band Protocol (Infrastructure)
  • Kava (Stablecoin/Infrastructure)
  • e-Money (Infrastructure/Enterprise/Stablecoin)
  • IOV (Wallet/Name Service)
  • IRISnet (Enterprise)
  • Persistence (Enterprise)
  • Playlist (Social)
  • Regen Network (Agriculture)
  • Sentinal (Infrastructure)
  • Terra (Stablecoin/Infrastructure)

Out of these projects, I’ll touch on the top 3 I find to be most notable:

Binance Chain (announcement)
The Binance DEX is built on fork implementations of Tendermint and Cosmos SDK. It utilizes a revised version of Tendermint consensus and its p2p network logic, as well as the Cosmos SDK for basic token transactions. Binance believes Cosmos is a better alternative to forks of Bitcoin or smart contract platforms like Ethereum. 

Band Protocol (announcement)
Band Protocol, which provides a secure and scalable decentralized oracle for Web 3, is leveraging an independent Cosmos-based blockchain for data requests and payments to power its data delivery network (D3N). 

Kava (announcement)
Kava is the first cross-blockchain DeFi platform powered by the Cosmos Network. It empowers digital assets holders to leverage their assets and hedge using a multi-collateral CDP system and collateral-backed stablecoin (USDX).

6. How Cosmos Competes with Ethereum? 

f5788f59b657509b982e5884a806907dd06a480a0a06a5c8b1161483c5cadfbd.png

Ethereum logo

Cosmos competes with Ethereum by aiming to improve upon three limitations apparent in Ethereum:

  • Scalability
  • Usability
  • Sovereignty

Limitation #1: Scalability
Decentralized applications (dapps) built on top of Ethereum are limited by a shared rate of 15 transactions per second. This is due to the fact that Ethereum uses Proof-of-Work (PoW) and that Ethereum dapps share the same resources on the same blockchain. 

Cosmos, on the other hand, powers decentralized applications with individual application-specific blockchains and features instant finality transactions with the Tendermint consensus algorithm. 

Limitation #2: Usability
The Ethereum blockchain serves an entire sandbox of potential dapps and use cases. While this is great in theory, it lacks optimization for specific use cases and optimizes for the average use case. Also, Ethereum dapps are limited to a few programming languages and specific models.

Cosmos increases the usability of a dapp with its application-specific blockchains that grant developers a tremendous amount of flexibility and freedom. Also, up until Cosmos, it was rather difficult to build and deploy blockchains for specific applications but the Cosmos SDK has made it relatively easy. 

Limitation #3: Sovereignty
Dapps on Ethereum all share the same underlying environment which essentially creates two layers of governance, Ethereum’s and the application’s governance. This poses a variety of issues for an application. For instance,  if the application requires a new feature in the EVM, it depends on Ethereum’s governance to implement it. 

Again, Cosmos fixes this limitation with its application-specific blockchains that can be tailored made to meet the requirements of each app.

7. Is Cosmos Interoperable with other Blockchains?

Yes, Cosmos is interoperable with blockchains within the Cosmos ecosystem and is also interoperable with other blockchains such as Bitcoin or Ethereum. 

Cosmos Network Blockchains

02b28db6821aab74cfeca17d6b8256e2305c24f7994e1ecfcbe5fe1ceeb979f3.jpeg

The connection between customized blockchains within the Cosmos Network is achieved through a protocol called Inter-Blockchain Communication protocol (IBC). 

This protocol leverages the instant finality property featured in the Tendermint consensus engine (and works with other fast-finality consensus engines), to allow heterogeneous chains to transfer value or data to each other.

Cosmos Hub and its ATOM token is the first blockchain and cryptocurrency in the Cosmos Network of blockchains. 

Other Blockchains

d9992ac32eee9dee885b7ae2d7f6ff7218f9d47f04b11d7b60726f4efd05fce1.jpeg

Cosmos is also interoperable with other non-Tendermint blockchains like Bitcoin and Ethereum. Any king of blockchain can be bridged to the Cosmos Network using a variety of complex techniques. 

9. Where to Store Cosmos Tokens?

Cosmos’ ATOM token is the native cryptocurrency of the Cosmos blockchain network built on Tendermint core. That said, ATOM was not issued on the Ethereum blockchain as an ERC-20 token and therefore has fewer wallets supporting ATOM, opposed to ERC-20 tokens. 

Nevertheless, Cosmos’ ATOM token is a popular cryptocurrency supported by a wide array of reputable crypto wallets. 

Most Popular Cosmos (ATOM) Wallets:

  • Ledger Nano S (hardware wallet)
  • Lunie Wallet (web & mobile wallet)
  • Trust Wallet (mobile wallet)
  • Cosmostation Wallet (mobile, web, desktop wallet)
  • imToken Wallet (mobile wallet)

Cosmos (ATOM) Staking & Governance Wallets:

  • Atomic Wallet 
  • Cobo 
  • Cosmostation 
  • Huobi Wallet 
  • imToken
  • Keplr 
  • Lunagram
  • Lunie
  • Math Wallet 
  • Rainbow Wallet
  • Qbao Wallet 
  • Trust Wallet
  • Wetez

In addition to the above-listed wallets, Cosmos (ATOM) can be stored on a variety of other reputable wallets as well.

10. Where to Buy & Sell Cosmos Tokens?

Cosmos (ATOM) can be bought and sold on a peer-to-peer (P2P) basis but the most popular way to buy, sell, or trade Cosmos is through cryptocurrency exchanges.

You can buy ATOM with cryptocurrency or fiat at the following top exchanges. In most cases, you will have to fund your account with fiat, buy Bitcoin or Ethereum, and then use BTC or ETH to buy Cosmos (symbol ATOM).

  • Binance - BTC, BNB, BUSD, USDT, USDC, USD
  • OKEx - BTC, ETH, USDT
  • Huobi Global - BTC, ETH, USDT
  • Coinbase Pro - BTC, USD
  • Kraken - BTC, ETH, USD, EUR

In addition to the exchanges listed above, Cosmos (ATOM) is also traded on a wide array of other exchanges and platforms that enable people to buy, sell, or trade cryptocurrencies.

Hope you enjoyed that read :) Let me know if I have missed something in the comments.


MuyAsk
MuyAsk

All truths are easy to understand once they are discovered; the point is to discover them


Crypto Truth Lexicon
Crypto Truth Lexicon

It is what it is.

Send a $0.01 microtip in crypto to the author, and earn yourself as you read!

20% to author / 80% to me.
We pay the tips from our rewards pool.