Cosmos (ATOM) blockchains in and out of the Cosmos Hub

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Cosmos (ATOM) blockchains in and out of the Cosmos Hub.

Direct from the desk of Dane Williams.




Gaining a better understanding of the interoperability of Cosmos (ATOM) blockchains. Chains that use the Cosmos SDK, both inside and outside of the Cosmos Hub.

Blockchain technology has gained widespread attention in recent years as a secure and decentralised way of processing transactions.

However, as the number of blockchain networks and use cases grows, interoperability has become an increasingly important consideration.

The Cosmos (ATOM) blockchain ecosystem offers a unique solution to this challenge by providing a decentralised network of independent blockchains that can easily communicate with each other.

Ultimately allowing for greater interoperability and scalability.

In this blog post I compare chains that use the Cosmos SDK, both inside and outside of the Cosmos Hub itself, to explore the concept of interoperability within the ecosystem.

The Cosmos Hub is the central point of the Cosmos blockchain ecosystem

What is the Cosmos Hub?

The Cosmos Hub can be described as the central point of the Cosmos blockchain ecosystem.

It serves as the main hub connecting all the different independent blockchains that use the Cosmos SDK.

By linking these blockchains together, the Cosmos Hub enables them to communicate and exchange value with each other.

Thus creating a truly interconnected network of networks.

There are several advantages to being a part of the Cosmos Hub.

The major advantage is that being part of the hub provides access to the security and interoperability features that are built into the Cosmos SDK framework itself.

These features help to ensure that transactions between different blockchains are secure and efficient, while also reducing the complexity of operating interoperable systems.

However, it's worth noting here that not every blockchain can simply become a part of the Cosmos Hub.

There are specific criteria that a project must meet before it can be added to the network.

These include factors such as that blockchain's level of decentralisation, security features and overall technical capability.

Are there Cosmos SDK chains outside of the Cosmos Hub?

While the Cosmos Hub is the central point of the Cosmos blockchain ecosystem, it's worth noting that not every project built on the Cosmos SDK is a part of the hub.

Some projects don’t qualify, or simply choose to operate independently of the Cosmos Hub for a variety of reasons.

One reason a project may choose to operate independently is to maintain a unique identity and governance structure.

By operating independently, projects can have greater control over their own destiny and can more easily implement their own specific requirements.

Additionally, some projects may have a specific focus or use case that doesn't necessarily align with the broader goals of the Cosmos Hub.

Regardless of whether a project is a part of the Cosmos Hub or not, the Cosmos SDK offers a range of advantages for building secure and scalable blockchain networks.

The modular design of the Cosmos SDK allows developers to build custom blockchain applications with ease.

As a result, the included developer tools simplify the process of creating and deploying these applications.

There are several blockchain networks that are built on the Cosmos SDK but operate independently of the Cosmos Hub.

One example of such a network is the Akash Network (AKT), a decentralised cloud computing platform that allows developers to manage applications in a secure and decentralised way.

The basic premise is that by using the Cosmos SDK, Akash is able to take advantage of the security features and developer tools provided by the SDK.

All while maintaining its unique identity and governance structure.

How does the ATOM token affect governance of blockchains within and outside the Cosmos Hub?

The ATOM token plays a crucial role in the governance of blockchains primarily within the Cosmos Hub.

ATOM serves as the native cryptocurrency of the Cosmos Hub and is used as the primary means of exchange within the Hub.

The ATOM token is also used to pay transaction fees and secure the network through staking.

In terms of governance, ATOM holders have the power to vote on proposed changes to the Cosmos Hub, such as changes to the network's parameters or the addition of new blockchains.

The more ATOM a holder stakes, the more voting power they have.

This means that larger holders have more influence over governance decisions.

For blockchains built on the Cosmos SDK but operating outside of the Cosmos Hub, the governance structure can vary.

Some of these blockchains may have their own native cryptocurrency that serves a similar governance role to ATOM, whereas others may use a different token or system entirely.

Again using the Akash Network as an example of a blockchain built on the Cosmos SDK, but operating independently of the Cosmos Hub, they’re able to operate as a completely sovereign blockchain with their own governance structure.

Akash has its own native token, AKT, which is used for governance on the platform.

Holders of AKT are able to vote on proposals related to the development, management and governance of the Akash Network.

The proposals can range from changes to network parameters such as transaction fees and block rewards, to more significant changes such as upgrades to the network's underlying software.

In saying that however, the Akash Network also has the ability to participate in the Cosmos Hub's governance through its ATOM holdings.

Remember that at its heart, the Cosmos Hub uses a simple Proof-of-Stake (PoS) consensus mechanism.

So whether they’re a Cosmos SDK project or not, whoever holds ATOM has a say in governance.

It just so happens that right now those within the Cosmos Hub have the most ATOM.

But that’s not to say that things will change further down the line as the ecosystem continues to evolve and decentralise.

Final thoughts on the interoperability of Cosmos (ATOM) blockchains in and out of the Cosmos Hub

By using the Cosmos SDK, blockchain projects can leverage the security, scalability and modular design of the Cosmos network.

All while also maintaining their own unique identities and governance structures.

Being a part of the Cosmos Hub offers benefits such as access to the Hub's security and interoperability features, as well as the ability to participate in the Hub's governance through the ATOM token.

In saying that however, operating independently also certainly has its advantages.

Allowing projects to maintain their own governance structures and to avoid the potential dominance of larger projects within the Cosmos Hub.

Even thought there are inherent centralisation issues that I haven't discussed, the concept of interoperability within the Cosmos ecosystem still gets me excited.

Surely I'm not the only one?

Best of probabilities to you.

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12 comments
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I am a bit confused but I am not sure if I am right. The SDK allows people to code their project in a way that works with the COSMOS(ATOM) blockchain. Does this mean that it's just the COSMOS blockchains or is there some way to represent that on various different blockchains? I was under the assumption that they have their own structure but can act on multiple chains due to the SDK.

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Does blockchain interoperability work between other blockchains?

Cosmos is primarily focused on interoperability between Cosmos SDK chains.

So others that use that same framework.

In saying that however, the Cosmos ecosystem has also been working on other tech to enable interoperability with other blockchain networks.

For example something I will do another post on eventually is the Inter-Blockchain Communication (IBC) protocol, which is built on top of the Cosmos SDK.

This protocol is designed to enable communication and data transfer between different blockchain networks, not just those built using Cosmos SDK.

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Ah ok. I was a bit confused about it before but it makes more sense. The IBC looks interesting and it would be quite amazing if the interoperability with other blockchain networks works.

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The Cosmos SDK is an open-source toolkit to build your own blockchain. All chains that use it (like Akash as @forexbrokr mentioned or Osmosis for example) are their own unique, sovereign chains (all layer 1 chains). The toolkit allows for customization, and use of a range of modules. They are all different.

These seperate layer 1 chains then connect to other chains via a protocol called IBC (Inter-blockchain communcations protocol) for various features. This builds a broader eco-system, which currently has 56 unique blockchains connected via IBC.

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Ah ok. That does make sense and 56 unique blockchains are quite interesting. Is it possible to mix and match features from different chains using the IBC?

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Yes, the good thing about the Cosmos eco-system is the chains are modular. Want smart contracts, add Cosmwasm module. Different teams are building different modules, and customizing their chains all the time, with much of the work open source.

Cross-chain smart contracts, interchain accounts, shared security, mesh security and all sorts of cross-chain use cases are on their way.

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I invested in the Cosmos ecosystem last year. I bought Cosmos, Juno, and Osmosis. Cosmos was taking the lion's share. I had two motivators: The ecosystem's potential and airdrops. It turned out that airdrops didn't contribute much. After holding them for one year, I sold them. I still believe in the potential of the ecosystem. Inter-Blockchain Communication Protocol (IBC) is working pretty well. We can make transfers between Cosmos blockchains quickly, securely, and economically.

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Yep, the IBC is great.

I'm of the opinion that blockchain interoperability is key.

Pretty much this is the reason why I've never understood the position of being a maxi.

You want all networks to succeed independently, but then you want them to talk to each other!

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I think the major advantage of cosmos is the efficiency in communicating with the protocols built in the ecosystem no matter how they operate. It is easy to communicate with AKT or SCRT no matter how they operate. Compare that with the hustle I went through while transferring assets into HIVE 🙈🕶️😈

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What is your process for getting assets from fiat into your Hive account?

As a Canadian can you access a CEX that has a HIVE listing?

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I can access Mandala where they list Hive. But, I am trying to figure out a way to use DEXs to bring in fiat into the Hive ecosystem. That's why I am asking all those questions on bHBD.

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The interconnectedness of chains built using the Cosmos SDK (provided they have integrated IBC) is an awesome feature of the Cosmos broader eco-system. The next steps are "shared security" which will allow chains to basically "rent", for want of a better term, security from the Cosmos HUB (ATOM), interchain accounts, the growth of LSD's (Like STRIDE for example), and the adoption of IBC by non-Cosmos projects (like NEAR and DOT potentially).

Governance issues always raise their head for ATOM, with conflict never far away. But overall, the vision of "the internet of blockchains" is alive and working.

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