{"id":763,"date":"2021-12-01T06:49:24","date_gmt":"2021-12-01T06:49:24","guid":{"rendered":"http:\/\/egrowonline.com\/?p=763"},"modified":"2021-12-01T06:49:24","modified_gmt":"2021-12-01T06:49:24","slug":"what-is-cosmos-the-internet-of-blockchains","status":"publish","type":"post","link":"http:\/\/egrowonline.com\/?p=763","title":{"rendered":"What is Cosmos \u2014 the \u2018internet of blockchains\u2019?"},"content":{"rendered":"


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The Cosmos ecosystem has seen rapid growth in recent months since the launch of Cosmos Hub \u2014 the first blockchain in the Cosmos ecosystem \u2014 in 2019.\u00a0<\/p>\n

Over 20 blockchains, including Cosmos Hub, Osmosis, Crypto.Org and Terra, are now connected in the Cosmos ecosystem by the Inter-Blockchain Communication (IBC) protocol that allows independent blockchains to talk to each other and transfer data and assets. Over 1.6 million IBC transfers took place across the blockchains in the last 30-days, according to Map of Zones data<\/a>.<\/p>\n

The Cosmos ecosystem currently secures over US$178.4 billion in digital assets including Binance Coin (BNB), Crypto.com Coin (CRO), Terra (LUNA) and Cosmos Hub (ATOM) \u2014 making it the second-largest blockchain ecosystem after Ethereum in terms of value, according to Cosmos<\/a>. Ethereum, Binance, Solana<\/a> and Avalanche currently have US$181 billion, US$19.5 billion, US$14.6 billion and US$13.7 billion respectively in total value locked, according to DeFi Llama<\/a>.<\/p>\n

Although Ethereum is currently the most widely used smart contract<\/a> platform, its popularity has led to scalability issues, and competitors<\/a> such as Solana<\/a>, Cardano<\/a> and Avalanche blockchains have emerged to challenge Ethereum\u2019s dominance. Aside from its large size, the Cosmos ecosystem is unique in how it enables independent blockchains in the network to communicate with each other.<\/p>\n

This Forcast.News<\/em> explainer will explore:<\/p>\n

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  1. What is Cosmos?<\/a><\/li>\n
  2. Cosmos\u2019 roots<\/a><\/li>\n
  3. The vision behind Cosmos<\/a><\/li>\n
  4. Cosmos\u2019 core features<\/a><\/li>\n
  5. Cosmos\u2019 native token \u2014 $ATOM<\/a><\/li>\n
  6. Key projects on Cosmos<\/a><\/li>\n
  7. What does the future hold for Cosmos?<\/a><\/li>\n<\/ol>\n

    1. What is Cosmos?<\/strong><\/p>\n

    Cosmos, which bills itself as the internet of blockchains, is a decentralized network of independent yet interoperable blockchains that are able to exchange information and tokens between each other permissionlessly.<\/p>\n

    Cosmos aims to address some of the issues faced by other blockchains \u2014\u00a0such as scalability, usability and governance \u2014 by providing the tools to help developers quickly build independent blockchains for a variety of use cases and enabling blockchains in the network to communicate with each other.<\/p>\n

    The independent blockchains, called \u201czones\u201d in the Cosmos ecosystem, are powered by the Tendermint proof-of-stake<\/a> byzantine fault tolerant (BFT) consensus algorithm. A byzantine fault tolerant consensus algorithm allows the network to reach consensus even if some of the nodes fail or act maliciously. The first blockchain on the Cosmos network is the Cosmos Hub<\/a> and ATOM is the native token of Cosmos Hub.<\/p>\n

    2. Cosmos\u2019 roots<\/strong><\/p>\n

    Before Cosmos was even an idea, blockchain software architect Jae Kwon founded Tendermint (also known as All in Bits Inc.) in 2014 and created Tendermint Core, a blockchain engine that creates proof-of-stake (PoS) consensus algorithms. The following year, Kwon, together with Ethan Buchman, went on to refine the Tendermint consensus algorithm that now powers Cosmos, and the two Tendermint co-founders published the Cosmos white paper<\/a>, \u201cA Network of Distributed Ledgers,\u201d in 2016.\u00a0<\/p>\n

    The Interchain Foundation<\/a> (ICF), a Swiss non-profit formed to support the development of the Cosmos Network, conducted an initial coin offering (ICO) of the ATOM token in 2017, raising US$16.8 million in 30 minutes \u2014 a highly successful blockchain-based fundraising event at the time. The ICF\u2019s funding program is mainly managed by two entities \u2014 Interchain GmbH, a wholly-owned subsidiary of the Interchain Foundation, and Informal Systems<\/a>, a spin-off of the ICF research and development team, with Tendermint co-founder Buchman as its CEO.<\/p>\n

    The Interchain Foundation has contracted with software development company Tendermint<\/a> to develop the Cosmos Network and build its infrastructure. Tendermint, one of the core contributors building out the Cosmos ecosystem, raised US$9 million in a Series A funding round in 2019 for the development of the project.<\/p>\n

    Peng Zhong, CEO at Tendermint and the first employee at Tendermint in 2015, told Forkast.News<\/em> in a recent interview that Tendermint Inc had initially intended to go the way of enterprise blockchain and sell the Tendermint consensus technology to large corporations. But it subsequently decided to focus on building out the Cosmos network to create as many sovereign blockchains as possible and allowing people to control their own network with on-chain governance, but at the same time, be able to transfer assets between each other.\u00a0<\/p>\n

    \u201cThere is a lot of potential in blockchain to reshape collaboration and connectivity and decision making across the world, and we\u2019ve seen a lot of examples of this with the chains that are IBC enabled right now, Zhong said. \u201cWe see a future where there will be hundreds, thousands, tens of thousands and a million blockchains further in the future, and that\u2019s what we\u2019re building towards.\u201d<\/p>\n

    3. The Vision of Cosmos<\/strong><\/p>\n

    Just as Ethereum aspires to be the world\u2019s computer,<\/a> Cosmos\u2019 goal is to be an \u201cinternet of blockchains<\/a>\u201d and aims to make it easy for developers to build blockchains for different use cases or applications, and for blockchains to communicate and transact with each other.<\/p>\n

    4. Cosmos\u2019 core features<\/strong><\/p>\n

    Blockchains such as Bitcoin traditionally exist as if in silos and are unable to communicate or interact with each other. Older blockchains also tend to be difficult to build on and can handle only a few transactions per second.\u00a0<\/p>\n

    Cosmos enables independent blockchains to exchange information and tokens with each other permissionlessly. Its vision of being a network of blockchains is achieved through open source tools such as the Tendermint consensus engine and a BFT consensus algorithm, Cosmos software development kit (SDK), and the Inter-Blockchain Communication Protocol, like a TCP\/IP for blockchains, allows blockchains to connect to each other to exchange data and value.<\/p>\n