Author: Daniel Li
As a veteran blockchain ecosystem, Cosmos stands out for its decentralization and openness compared to other ecosystems. However, due to relatively low-profile marketing activities, Cosmos has always given the impression of being lukewarm on Twitter. In fact, as the birthplace of today's application chain revolution, Cosmos has never lacked the ability to incubate and attract high-quality ecological projects. Although the Cosmos ecosystem has been relatively sluggish for a period of time, it is still one of the most potential areas in the cryptocurrency industry to achieve hundredfold growth. Recent development trends indicate that projects with strong fundamentals and sustainable narratives will benefit greatly in the upcoming bull market, and Cosmos is ready to take full advantage of this trend.
01. The Rising Cosmos Ecosystem: Reassessing the Underestimated Potential
Cosmos is an open-source blockchain ecosystem designed to achieve interoperability between different blockchains. Although there is still some gap in technology and ecological projects compared to some leading systems, Cosmos has strong advantages in decentralization and interoperability. In particular, the Cosmos development team launched the Cosmos SDK and IBC, which helped developers solve the problem of reinventing the wheel and played an important role in promoting technological progress in the entire industry.
However, Cosmos's market valuation does not match its strength. Compared to some other blockchain ecosystems, Cosmos's ecosystem is relatively small and has not attracted enough developers and users. Additionally, Cosmos's technology and application scenarios are relatively complex, requiring more time and resources for promotion and popularization. Therefore, in the cryptocurrency market that values data and liquidity, Cosmos's market value has been severely underestimated for a long time. As of now, Cosmos's market value is only $31.5 billion, ranking 23rd. Its token ATOM also has a huge difference in market value compared to tokens of other ecosystems due to the lack of practicality.
To alleviate this situation, the Cosmos 2.0 white paper was released at last year's Cosmoverse conference, aiming to change the dilemma of low utilization of the Cosmos Hub network and ATOM token. Around these goals, Cosmos has announced some progress, such as upgrading the original Interchain Security to "Replication Security" and passing the Liquidity Staking Module (LSM) proposal. In addition, in May of this year, the Cosmos ecosystem chain Neutron mainnet went live, which first used the upgraded security mechanism "Replication Security" and announced an airdrop to Cosmos Hub stakers, gradually heating up discussions about the value capture of Cosmos and ATOM and its ecosystem.
Based on these technological improvements, the ecological projects of Cosmos have experienced a liquidity explosion this year. First, the daily trading volume of the ecological public chain Canto once exceeded that of Solana, bringing a successful start to Cosmos. Subsequently, the total locked value (TVL) of the liquidity staking protocols Stride, Layer1 public chain Injective, and Kujira continued to rise, increasing by 2 to 6 times compared to January. In April of this year, according to Token Terminal's data monitoring, the number of active developers on the Cosmos SDK once exceeded that of Ethereum, currently ranking second. In addition, the modular blockchain network Celestia built on the Cosmos SDK has recently attracted market attention, and the Celestia + Cosmos model has been hailed as the ultimate form of application chains.
The outstanding performance of Cosmos's ecological projects has rekindled market attention to Cosmos. Many users have shown high expectations for the landing of Cosmos 2.0's future plans, and there are even voices in the market saying "Cosmos Summer is coming." In the recent rebound market, tokens related to the Cosmos ecosystem, such as Celestia (TIA), Injective (INJ), and Osmosis (OSMO), have all risen by more than 20% in the past week. INJ has even increased by over 110% in a month. These positive trends indicate that Cosmos is gradually gaining market recognition and attention, laying a solid foundation for its future development.
02. Future Development Plan of Cosmos Technology: Providing Technical Support for Liquidity Explosion
As we explore the latest developments in the Cosmos ecosystem, it is necessary to first understand the future development plan of Cosmos technology. Continuous technological innovation is crucial for maintaining the growth of the ecosystem and providing unprecedented liquidity for blockchain applications. In September 2023, the Interchain Foundation, which drives the development of the Cosmos ecosystem, publicly released the Interchain 2024 development plan, outlining the future development plan of Cosmos technology.
CometBFT: The Cornerstone of Cross-Chain Scalability
CometBFT is an innovative consensus algorithm and the core of Interchain scalability. By ensuring consensus among validators on block generation, CometBFT enables the Interchain ecosystem to maintain security, decentralization, and integrity. The Interchain Foundation plans to further expand the coverage and applicability of CometBFT, empowering the development of sovereign, interoperable applications. Currently, CometBFT has been upgraded to v0.38, and the foundation plans to release v0.39 by the end of 2023, featuring efficiency improvements, comprehensive data support APIs, and enhanced indexing systems.
Cosmos SDK: Modularity and New Features
The Cosmos SDK is a multifunctional toolkit for developing blockchains or Rollup applications. It has been adopted by many new blockchain projects, including Cosmos-based applications, Fairblock, Berachain, and the upcoming dYdX V4. In the future development plan, the Cosmos SDK will focus on modularity and introducing new features. This will enable developers to create more complex, modular applications, fostering a broader and more powerful ecosystem.
CosmJS: Improving Efficiency and User Experience
CosmJS is a library that helps developers integrate JavaScript clients with the Cosmos SDK blockchain. The Interchain Foundation plans to enhance CosmJS with a new encoder to improve its efficiency, reduce code bloat, and provide a more streamlined and professional development experience. This will enable developers to create more elegant, user-friendly applications, ultimately enhancing the attractiveness of the Cosmos ecosystem.
CosmWasm: Unlocking Decentralized, Permissionless Deployment
CosmWasm is a smart contract framework built on the Cosmos SDK. It allows developers to deploy decentralized applications without permission requirements, while also allowing blockchain developers to separate their product development cycle from blockchain development, reducing the cost of validator upgrades. The Interchain Foundation will further optimize CosmWasm to make it easier for developers to create and deploy various applications, ultimately increasing blockchain utilization. Key focus areas include IBC adoption and account-based smart contracts.
IBC Protocol: Enhancing Interoperability and Scalability
IBC (Inter-Blockchain Communication) is a protocol that enables secure, decentralized, and permissionless data transmission between blockchains. The Interchain Foundation plans to update IBC in 2024, focusing on two main themes: scalability and usability. By improving the scalability and interoperability of IBC, Cosmos will further enhance the capacity of its ecosystem, enabling seamless interaction between blockchains, applications, and smart contracts.
03. The Latest Changes in the Cosmos Ecosystem: Accelerating Development and Innovation
With the continuous development of the digital asset market, the Cosmos ecosystem has once again demonstrated tremendous potential in recent months. As an open-source multi-chain blockchain network, the Cosmos ecosystem has multiple advantages such as smart contracts, scalability, security, and cross-chain interoperability. At the same time, its application chain theory is constantly evolving. Here are some noteworthy changes in the ecosystem that have occurred recently.
Liquidity Staking Module: The Liquidity Staking Module (LSM) is a new module designed to provide a modular solution for liquidity staking in the Cosmos ecosystem. The implementation of LSM on the Cosmos Hub began on June 14, 2023, and a software upgrade plan was released. The impact of LSM's implementation on the Cosmos ecosystem is that users can now directly stake the ATOM they have already staked for liquidity without waiting for the unbonding period.
Token Economics Upgrade: There has been a significant change in the economic model of the Cosmos token ATOM, shifting from the past pursuit of high returns to a narrative of pursuing real earnings. On May 10th, the Neutron mainnet went live, combining the Cosmos SDK and IBC to create the CosmWasm (Cosmos virtual machine) platform, the first consumer chain using "Replication Security" in Cosmos. Neutron aims to address the criticism of ATOM 1.0 for its lack of clear practical value and bring new narratives and momentum.
Enhanced Interoperability: Interoperability has always been the biggest advantage of Cosmos compared to other ecosystems. The launch of Evmos 2.0 in August this year undoubtedly further solidified Cosmos's advantage in this area. Evmos is built on the Cosmos Inter-Blockchain Communication (IBC) protocol, which has the potential to elevate the powerful multi-chain ecosystem to new heights. Evmos 2.0 will achieve interoperability between Ethereum and the Cosmos ecosystem, allowing developers to build applications that can interact with both ecosystems.
Rise of Perpetual Contracts: Perpetual contracts play an important role in the digital asset market and have experienced rapid growth recently. As a leading perpetual contract exchange in the Ethereum ecosystem, dYdX v4 announced its migration to the Cosmos ecosystem, which will undoubtedly have a positive impact on the Cosmos perpetual contract module, bringing more liquidity and innovation to the Cosmos ecosystem.
Native Liquidity Increase: Native liquidity is crucial for the DeFi field, enabling seamless on-chain interactions and reducing bridging risks. Recently, Tether's stablecoin USDT has been integrated into the Kava blockchain, consolidating Tether's leading position in the field and introducing new native liquidity to Cosmos. In addition, in March of this year, the Cosmos ecosystem's native asset issuance platform Noble officially announced a partnership with Circle, aiming to bring native USDC into Cosmos. Noble stated that this integration will generate hundreds of millions of dollars in liquidity in Cosmos in the coming months.
04. Overview of Popular Projects in the Cosmos Ecosystem
Initia
Initia is a popular project based on Cosmos, dedicated to building a highly interconnected modular Rollup network. By abstracting the complexity of traditional modular and multi-chain systems, Initia provides support for developers to build scalable and autonomous systems. Its architecture includes L1 (Layer 1), L2 (Layer 2), and communication layers, allowing developers to easily launch application-specific blockchains based on Initia L2 without needing to understand complex chain-level infrastructure or run validator sets.
Initia adopts the Cosmos Software Development Kit (SDK) but uses a computing framework called MoveVM, based on the Move smart contract language. Additionally, Initia utilizes optimistic rollups as a specific L2 solution. By integrating L1, L2, and communication layers, Initia achieves seamless message passing and bridging between different virtual machines (such as EVM, WasmVM, and MoveVM), making it the first MoveVM computing framework compatible with the Cosmos IBC protocol and enabling seamless interaction with other blockchain networks in the Cosmos ecosystem.
According to The Block, Initia has received seed round investment from Binance Labs, with specific funding amount and further details yet to be disclosed. This funding will be used to support the development of Initia's infrastructure, expand product tools, and incubate key application layer projects to drive the expansion of the Initia ecosystem. Currently, Initia is still in the development phase of the testnet, and once launched, it will greatly enhance the liquidity of the Cosmos ecosystem.
Celestia
Celestia is a modular blockchain network based on the Cosmos ecosystem, aiming to provide pluggable consensus and data availability layers. The project's goal is to enable anyone to quickly deploy decentralized blockchains without additional consensus layer costs and provide developers with the ability to build and deploy blockchain applications more flexibly.
One important feature of Celestia is data availability sampling, allowing nodes to verify only a small portion of a block's data without needing to verify the entire block. This significantly reduces the hardware requirements for validator nodes and improves network scalability. In collaboration with Cosmos, Celestia works with Tendermint and Cosmos Zones as a data availability layer. This allows chains in the Cosmos ecosystem to leverage the data availability functionality provided by Celestia and achieve minimal trust through fraud proofs. This collaboration promotes interoperability and scalability within the Cosmos ecosystem, while also providing a unified level of security.
On October 31st, the Celestia mainnet officially went live, and its token TIA has been listed on major exchanges, with the current price of TIA at $2.33.
dYdXV4
dYdX is a leading L2 Dapp on Ethereum, and its latest version, dYdX V4, is expected to be released in December this year. This upgrade is an important milestone for dYdX as it prepares to migrate to the decentralized network Cosmos. This move aims to address Ethereum's scalability limitations and provide a more decentralized architecture for dYdX's rapidly growing user base and trading volume.
As a popular L2 Dapp, dYdX has attracted a large number of users and transactions, putting pressure on the Ethereum blockchain. However, Ethereum's scalability limitations hinder dYdX's expansion, prompting the need for more advanced solutions. Cosmos and its cutting-edge SDK provide the perfect solution for dYdX's development, supporting the development of decentralized and independent blockchain networks to meet dYdX's growing needs.
By migrating to Cosmos, dYdX V4 will not only improve transaction speed but also eliminate concerns about centralization. Cosmos's decentralized network allows dYdX to continue to adhere to its commitment to transparency and fairness, providing users with a more secure and reliable trading experience. As a leading decentralized exchange, dYdX's daily trading volume has exceeded $3 billion, and its migration will bring a large number of new users and liquidity to the Cosmos ecosystem.
Neutron
Neutron is an intelligent contract infrastructure based on the CosmWasm platform, allowing developers to easily deploy dApps on this platform without the need for complex governance voting or whitelist verification. Through collaboration with the Cosmos Hub and other projects, Neutron combines security and cross-chain functionality, allowing DeFi applications to safely expand into a vast network composed of 51 or more interconnected blockchains. In simple terms, Neutron provides developers with a convenient and secure way to ensure their applications run smoothly across multiple blockchains.
Although Neutron was not widely known before, Cosmos has been actively preparing. According to the Interchain Stack 2024 roadmap, Neutron will become the first consumer chain on Cosmos. It aims to host a DeFi product ecosystem built around NTRN and ATOM, providing support for token utility and demand. This will play a crucial role in driving the development of the Cosmos ecosystem and the implementation of ATOM 2.0.
In May of this year, Neutron successfully completed a funding round led by Binance Labs, raising a total of $10 million. Other participants include CoinFund, Delphi Ventures, LongHash Ventures, Semantic Ventures, and Nomad Capital. The Neutron token NTRN was listed on Binance in October, with the current trading price at $0.290.
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
