The virtual currency is also very close to Ethereum Classic (ETC), IOTA (MITA) and NEO (NEO). Cosmos would have to improve its network, move forward with its developments and distinguish itself from Cardano, ICON and AION with unique features and enhancements to its blockchain. With the implementation of Tendermint on the Cosmos platform, it is possible to commit blocks faster than Ethereum’s PoW’s network. That means that the Cosmos network has a higher performance blockchain compared to Ethereum.
The solution to it will allow not only to make payments between blockchains but also to exchange information in full. Cosmos Hub is a blockchain network that has its own digital asset called ATOM. The main function of the ATOM virtual currency is to allow users to vote, validate or delegate decisions to other validators. Atoms can be used to pay for transactions fees and reduce also the spam on the network. Cosmos works with parallel blockchains that are independent of each other and that are powered by classical BFT consensus algorithms.
Cosmos is a complete technology stack that goes beyond simply allowing different blockchains to connect and share data with each other. They have also created a streamlined development process that allows developers to create their own custom blockchain in months or even weeks, instead of years. With PoS, the network is secured by users “staking” or locking up their crypto – specifically ATOM tokens – as a pledge that they won’t cheat the system.
One issue faced by the crypto world is that individual blockchains aren’t great at communicating with each other. That’s not ideal if you consider the vision of transferring crypto assets globally in an easy and affordable manner. There’s no easy analogy, but it would be a bit like Walmart only accepting Visa payments, while Whole Foods only took Mastercard. Cosmos Hub is Cosmos’s primary blockchain that connects other customized blockchains known as Zones. It does this by keeping track of the state of each Zone through the Inter-Blockchain Communication Protocol (IBCP). Through this protocol, information can easily travel between any Zone connected to Cosmos Hub.
A leader validator then proposes new blocks for others to vote on. Successful blocks provide a block reward given to the validator and shared with users who stake ATOM behind their chosen https://www.tokenexus.com/ validator. Cosmos is an awe-inspiring project with good plans for the future. The network’s native token, ATOM, has a high probability of surpassing its current all-time high.
- It costs about $0.02 to $0.03 to send thousands of dollars in value across the Cosmos network.
- Cosmos is a solid cryptocurrency that solves an important problem for the crypto industry.
- As mentioned before, the Cosmos Hub is powered by the Tendermint BFT consensus algorithm that provides scalability, speed and deals with the environmental issues of PoW networks.
- Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
- Let’s explore precisely why Cosmos has stayed a popular choice and how it allows blockchains to work together easily.
Furthermore, Tendermint has different protective measures that prevent certain attacks. Using Tendermint, nodes have a non-negative amount of voting power, while others have positive voting power. The second ones are called validators and those able to participate in the consensus protocol. Their work is to broadcast cryptographic signatures and votes to agree on the next blocks. Cosmos is working to solve both scalability and usability limitations in blockchain technology. It allows DAPPS to be written and coded in any language, not limiting it to the language of consensus mechanism.
Why is Tendermint important?
The applications, networking, and consensus mechanism of the Cosmos Network must be interconnected for optimal functioning throughout. Cosmos provides tools that developers need to develop blockchain applications. This is possible through the Cosmos SDK which creates an ecosystem of modules designed for developers to create blockchain apps without starting from scratch each time. Each of the blockchains on the Cosmos ecosystem is powered by the BFT consensus algorithm. Cosmos uses the Tendermint protocol which stands out for its fork accountability, simplicity, and performance. Cosmos, sometimes referred to as “the Internet of Blockchains”, is a blockchain network architecture composed of many independent blockchains (zones).
- Support for the activities such as token exchange may present itself as a challenge when it comes to ensuring that token sources are trusted just as well as the validators.
- Cosmos creates an ecosystem of blockchains that can scale and interoperate.
- Voting is open to those who have staked their tokens – more tokens equal more influence in the vote.
- One of the major advantages of Tendermint’s consensus algorithm is that through its light client security, it is suitable for internet-of-things (IoT) use cases.
- Coinbase is another popular cryptocurrency exchange where you can buy ATOM.
- There are several other blockchain networks in the market that are also working to offer interoperability in the cryptocurrency space.
We don’t know exactly what form those fees will take (ATOM stakers will get to vote on that), but one proposal suggests paying fees in a secondary token called photons. This would be similar to VeChain, which earns stakers a secondary token called VTHO. Users who stake ATOM will get compensated in the form of new ATOM that’s minted and distributed to all stakers. Plus, every transaction that passes though Cosmos Hub requires a small fee. Each such network has a unique software stack and autonomous management. This approach allows users to bind Blockchains working on the new Proof-of-Stake scheme with the classic Proof-of-Work chains.
There is then evidence over three separate blockchains of the activity. This ability for blockchains to interact with each other has given Cosmos the nickname “The Internet of Blockchains.” With Solidity usage, what is atom coin it is possible to develop smart contracts that will work in the Cosmos blockchain. Ethermint is an implementation of the Ethereum blockchain on top of Tendermint, which is implemented in the Cosmos Network.
- When bitcoin launched 12 years ago, it launched with what’s known as a proof-of-work (“PoW”) consensus mechanism.
- In essence, the Cosmos SDK is the skeleton of blockchain, and the plugins are the flesh.
- Cosmos calls itself the most customizable, scalable, powerful and interoperable ecosystem of connected blockchains.
- And the Cosmos Software Development Kit (SDK) provides developers with essential tools such as the Tendermint Core, and Tendermint BTF Engine.
- Always make sure to do your own research before investing in any new project.