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- Cosmos Network aims to provide safe seamless communications and transactions and data exchange between different blockchains.
- The network has its own ATOM coin, which pays transaction fees in the ecosystem and can be staked to get rewards and secure the ecosystem.
- Cosmos Network uses open source tools, such as Cosmos Hub, Zones and Tendermint Core to ensure smooth level interconnection and operation.
- Cosmos offers users and developers such advantages as decent scalability, increased interoperability, sovereignty, customisable app state and others.
What Is Cosmos (ATOM) Network?
Cosmos is a decentralized network that strives to provide a solution to the scalability and interoperability problems that many blockchain networks face at the moment.
Cosmos Network is widely know with its pseudonym in the crypto space - ‘Internet of Blockchains’. Its called so cause its mission is to provide seamless and secure communications, as well as transactions and data exchange between different blockchains.
Interesting fact! Cosmos is currently protected by more than 180 validators, and its ecosystem includes about 249 interchain apps and services.
The Cosmos Network has its own native crypto called ATOM cryptocurrency, which is used to pay transaction fees in the ecosystem. Token holders can stake ATOM, generate extra income and contribute to the ecosystem’s security.
Source: Cosmos Network
How Does Cosmos Network Work?
Cosmos constantly grows and expands, and at the moment offers users multiple interconnected applications and services. It uses hubs, the Inter-Blockchain Communication (IBC) protocol and the Tendermint consensus algorithm to ensure communications between blockchains are as secure as possible.
The network offers developers a variety of open-source tools to create independent blockchain dApps instead of relying on a single chain. Besides, Cosmos Network offers users various innovative products, namely:
Source: Cosmwasp
Important! The network has also developed unique solutions such as “Interchain Security” so that users can launch and scale safely, as well as “Neutron” for deploying smart contracts.
To function properly, the Cosmos network uses several layers - application, which processes transactions, networking, which provides communication between transactions and blockchains, and consensus to helps nodes reach an agreement on the state of the system.
To ensure smooth operation of the levels and their interconnection, Cosmos Network uses various open source tools, the main of which are Cosmos Hub, Zones and Tendermint Core.
Cosmos Hub
The first blockchain released on Cosmos was Cosmos Hub, which acted as an intermediary between all the independent blockchains created on Cosmos. Cosmos Hub is the main network for the Cosmos blockchain.
The main task facing the Cosmos Hub is to enable and facilitate interaction between these blockchains. Another important function of the Hub is providing interaction with PoW blockchains, such as Ethereum, through bridges.
Interesting fact! Token holders can vote on proposals put forward by the Cosmos Hub.
Zones
Independent blockchains built by the Cosmos Network are called zones. The Cosmos Hub is directly connected to them as it monitors the status of zones to ensure their interaction.
«Each zone connects to another zone through hubs. Cosmos Hub is the main one, but other hubs are also available» - CoinTelegraph.
All zones can operate independently and perform functions such as transaction and account authentication. It's important to know that zones don't have to work with each other, but they are linked to the Cosmos Hub anyway.
Source: MapofZones
Tendermint Core
Tendermint can be described as a set of developer tools in Cosmos. It consists of the Tendermint Core consensus engine and the Application BlockChain Interface or ABCI.
The central element, Tendermint Core, is a PoS governance mechanism that ensures synchronization of the distributed network of computers where Cosmos Hub runs.
Benefits Cosmos (ATOM)
- Scalability. While multiple blockchain networks struggle with scalability, Cosmos with its consensus mechanism and unique modular architecture found a solution. Cosmos blockchain achieves horizontal scalability by allowing multiple zones to operate independently and share data through the Cosmos Hub.
- Interoperability. Using IBC, blockchains in ecosystems can interact and transact with each other, which significantly increases the network’s interoperability.
- Flexibility. Cosmos offers users maximum flexibility in defining the state of their applications and allows them to customize the runtime, transaction types, and more.
- Sovereignty. Each blockchain in the Cosmos Network can operate independently and maintain sovereignty. Moreover, the platform also allows building with sovereignty, independently selecting validators, and customizing runtime.
- Any language. Cosmos allows users to build using a suitable programming language since ABCI can be wrapped in any.
Cosmos Token:
ATOM is the native cryptocurrency of the Cosmos network that performs a number of important functions in the ecosystem. So, what is ATOM crypto used for? First of all, ATOM crypto is necessary to pay transaction fees on the network. Besides, Cosmos coin holders can influence the future of the ecosystem and vote on proposals submitted by the Cosmos Hub.
Token holders can stake ATOM cryptocurrency and contribute to the development of the Cosmos Network and its security, while also earning rewards. Moreover, since Cosmos Hub uses the Interchain Security feature, all transactions generated by the chains bring both validators and stayers a share of the commissions.
Important! The total supply is 390,930,671 ATOM and at the moment all the Cosmos tokens are all in circulation. As of July 1, 2024, the cosmos cryptocurrency price is $6.78.
Comparison with Other Blockchain Networks
Cosmos vs. Ethereum
Ethereum does not offer decent scalability, since in some cases it takes up to several hours to complete a transaction. In this aspect, Cosmos is undoubtedly superior to Ethereum since Tendermint BFT PoS algorithms are capable of processing more than thousands of transactions per second.
Also, unlike Ethereum, Cosmos has a more convenient and developer-friendly design, which allows users to quickly and cheaply create sovereign blockchains.
Important! Some users and developers still prefer Ethereum as it is more popular as a blockchain. Currently, it still provides the most advanced blockchain features on the market.
Cosmos vs. Polkadot
Cosmos and Polkadot differ in several key areas, one of which is governance in transaction validation. According to Cosmos Hub, transactions are verified by 100 leading validators, while delegators can select and modify validator pools to stake tokens and receive rewards.
On Polkadot, parachains share the same set of validators, providing enhanced network security through a central coordinating blockchain. Cosmos blockchains connected to the hub do not need to share the same unified security.
Polkadot also handles the transfer of tokens from one parachain to another through smart contracts, while IBC Cosmos facilitates asset transfers and cross-chain interactions through IBC and Cosmos Hub. In this way, Cosmos can record every transaction in two interacting zones and in the hub.
Cosmos (ATOM) Prospects
Now Cosmos (ATOM) looks like a fairly promising ecosystem that can already compete with such giants as Ethereum and Polkadot. Due to Interchain Security developments, Cosmos will offer even better protection for interconnected chains in the future.
The platform is a strong example of solving the problem of blockchain interoperability. Its success largely depends on the technology’s long-term performance and the strategy’s flexibility in response to competitors’ actions. There is acceptable space for several platforms in the interconnection market to meet the demand fully.