Cosmos, an Internet of Blockchains

2022-06-23, 07:42

[TL; DR]
The Cosmos blockchain which was created in 2014 and launched in 2019 hosts over 260 applications and blockchains.
Cosmos is a layer-0 blockchain, meaning that layer-1 blockchains can exist on it.
Cosmos enhances quick transaction finality, scalability, security and interoperability among blockchains.
The Cosmos stack consists of Tendermint Core, Cosmos SDK and IBC.
keywords: Cosmos, Atom, inter-blockchain communication, interoperability, scalability, Tendermint core, software development kit (SDK)

Some developers and blockchain based projects oftentimes face the problem of choosing the ecosystem to launch their blockchains. They have a choice whether to use an existing system or to create a new one. However, there is a reliable and secure ecosystem where developers can create their own blockchains which are highly scalable and interoperable. Yes, Cosmos has an existing infrastructure which enables developers to build their own blockchains.

The Cosmos ecosystem

Certainly, most developers would like to understand how Cosmos functions before developing their blockchains on this ecosystem. As a layer-0 blockchain Cosmos has an infrastructure which layer-1 blockchains can use to create their ecosystems. Currently, there are over 260 blockchains that exist on the Cosmos layer, which is the reason people call it an “an internet of blockchains.”

Source: Mobiletwitter

One of its core components, Inter-Blockchain Communications (IBC) protocol, enables all the blockchains that exist on it to interact with each other, meaning that they can share their digital assets and data. Also, the Cosmos’ Tendermint Core consensus engine enables interoperability among the independent blockchains built on it. Another essential attribute is that the independent blockchains can develop dApps. However, the developers cannot build the dApps directly on the Cosmos blockchain.
By the way, interoperability is the capability of independent blockchains to interact with each other. To achieve this feat, Cosmos uses its open source technology. It also offers other blockchain the opportunity to use its software development kit (SDK). We will discuss more about this later. But for now, it suffice to say that Cosmos offers a scalable, secure and inexpensive product to the blockchain industry.

Source: Opencolleges

The current scenario

As we have already said, there are now over 260 applications and blockchains built on the Cosmos ecosystem. In a related matter, the volume of digital assets transacted on the protocol now surpasess $150 billion. Nevertheless, there is nothing surprising about this development considering that the blockchain hosts many dApps, games, marketplaces and projects.

Historically, Cosmos was formed in 2014 but became operational in 2019.

The cosmos hub

The Cosmos hub is a blockchain system that enables all the independent blockchain built on it to communicate with each other. More importantly, It has the capacity to house thousands of interconnected blockchain protocols. Since it uses a proof-of-stake (PoS) consensus mechanism it requires people to stake its native token, ATOM, to secure the network.

Basically, the Cosmos system uses two types of blockchains namely zones and hubs. In order to enable interoperability, each zone connects to several hubs. Similarly, every hub connects to other hubs, creating a web of blockchains and dApps.

The Cosmos Stack

The software engineers can easily build their blockchains and decentralized applications on Cosmos using the tendermint core, the Cosmos software development kit (SDK) and the Inter-Blockchain Communication (IBC) which is a network communication system. Thus, the Cosmos Stack comprises Tendermint Core, Cosmos SDK, a software development kit, and IBC, which we shall discuss next.

Tendermint

The Tendermint core, comprising several modules including the P2P networking layer and the Application Blockchain Interface (ABCI), is the consensus engine which drives the Cosmos ecosystem. Using this infrastructure, developers can create their own consensus layers. After that they can create their own decentralized applications. Therefore, in other words, the Tendermint Core is the software which software developers use to build their own blockchains.

Source: Medium

Many developers prefer the Tendermint BFT consensus mechanism since it uses a proof-of-stake (PoS) consensus algorithm which enhances scalability and fast transactions. As a fact, the Tendermint blockchains are among the most secure, fast and scalable in the industry. For instance they can handle up to 10 000 transactions per second. In addition, developers are able to create customizable blockchain which enables flexibility in their designs and use.

Moreover, the developers can create different tokens on the Cosmos ecosystem. Currently, the Kava (KAVA), Akash Network, Band Protocol (BAND) and Aragon (ANT) are examples of tokens that exist on the Cosmos system.

The Cosmos Software development Kit (SDK)

The Cosmos Software Development Kit (SDK) is an open source infrastructure which developers can use to create different applications specific blockchain networks and digital assets. It is also very simple to use as developers can use pre-built and customer-made modules.

For example, the developers can use the pre-built modules which perform various functions including the creation of accounts, the management of tokens and staking. Another interesting fact is that the software engineers can use the modules which others have developed. Terra, Kava and RISNet are examples of blockchain that exist on the Cosmos infrastructure.

The Inter-Blockchain Communication Protocol (IBC)

The Inter-Blockchain Communication Protocol (IBC) enables the sending and receiving of data among blockchain networks. It is the part of the Cosmos Infrastructure which standardizes the sending of information to other networks. Basically the IBC supports various substrate-based blockchains which include Kusama (KSM) and PolkaDot (DOT). As a point, any blockchain network that uses the proof-of- stake can interact with Cosmos.

Cosmos’ native token

ATOM is Cosmos’ internal token which drives the various functionalities of the blockchain. Users can stake the ATOM and in the process participate in securing the blockchain using the hybrid proof-of-stake mechanism.

Purchasing, Trading and investing in ATOM

Since the Cosmos token, ATOM, drives the ecosystem, many people wish to buy, hold and trade it. As we have already mentioned, other individuals would like to stake the token. As a result, you may need to know how to obtain this cryptocurrency. Gate.io is one of the major exchanges where you can buy and sell ATOM.

Gate.io is an easy to use, yet secure exchange. There are three ways in which you can purchase ATOM. You can buy it using a credit card, bank transfer or P2P trade.

If you want to trade ATOM you can easily use spot trading. For example you can trade it for BTC or USDT.

On the other hand, there are various ways in which you can invest at Gate.io using ATOM. You can lend it using the crypto lending feature or provide liquidity using the liquidity mining section. Also, you can invest in Futures or ETFs.

Conclusion

The Cosmos blockchain dubbed the internet of blockchains solves the critical problems of scalability, security, speed and cost which many networks encounter. It has a solid infrastructure to achieve its vision of making it easy for developers to build blockchains which easily transact with each other. Cosmos achieves this through its key components- the Cosmos SDK, Tendermint core and the Inter-Blockchain Communication Protocol (IBC).

Author: Mashell C., Gate.io Researcher
This article represents only the views of the researcher and does not constitute any investment suggestions.
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