Famous exchange Binance published yesterday a sounding news saying “Binance will open trading for ATOM / BNB, ATOM / BTC and ATOM / USDT trading pairs at 2019/04/29 4:00 AM (UTC). Users can now start depositing ATOM in preparation for trading… Cosmos Listing Fee: 0 BNB”. Today thousands of people wonder “what is Cosmos?” and “how does the Atom currency work?” Cosmos is an innovative concept. Officially it exists since 2017. Unofficially, it seems to be more years old. The simplest way to explain Cosmos is to say “It is a network of Blockchains where you can create a Blockchain according to your needs quickly and efficiently”.
Blockchain technology is, in these days, in the mouths of hundreds of millions of people around the globe. It is comparable to the Internet revolution a few decades ago. They say Blockchain is destined to revolutionize the world of finance. As a matter of a fact, Blockchain technology has existed for many decades, as well as other types of graphs such as “lists” or “trees”. These are structures where you can store information. So, it is important to keep in mind that Blockchain itself is not something so new.
However, as of 2009, Satoshi Nakamoto’s implementation of the Bitcoin protocol on top of an open, public and decentralized Blockchain, opened the eyes of the entire world. It was a new use of the Blockchain that generated the novelty of having a open immutable public ledger (a book of public truth) without having to depend on a central authority. Bitcoin Blockchain could only run one application, “Bitcoin”. Soon, developers realized that a Blockchain should be able to host many applications. Thus, in 2014, Ethereum published a new proposal: a single Blockchain where many types of applications could be implemented.
Bitcoin is a Blockchain on which, in principle, only one application is running. Ethereum is a Blockchain created to function as a universal supercomputer capable of running a virtual infinite number of applications. After Ethereum, many other Blockchains were born with the same principle of being a multipurpose planetary computer, for example, EOS, Cardano, Tron, Tezos, Neo, Ethereum Classic and many others. At present, the number of new Blockchains is immense. They all enter the market to offer some attractive advantages. But, they all share serious limitations too.
Three problems that multipurpose Blockchain technology presents at present are scalability, complexity of implementation and interoperability. First of all, through projects promise to scale “soon”, Bitcoin and Ethereum continue at the level of 7 and 20 transactions per minute. Second, for any developer who wants to create and launch a new Blockchain, the process is hellish. It takes even years, a lot of manpower and funding to create a Blockchain. And, third, the more Blockchains that we create in the human world, the more isolation of individual ecosystems we produce, since solid interoperability between chains is still in the dream phase. This is not good in a globalized world.
Cosmos is designed to become the next step in the evolution of Blockchains. Its concept includes a solution for each of the three major problems of scalability, complexity of implementation and interoperability. “The vision of Cosmos is to make it easy for developers to build blockchains and break the barriers between blockchains by allowing them to transact with each other. The end goal is to create an Internet of Blockchains, a network of blockchains able to communicate with each other in a decentralized way. With Cosmos, blockchains can maintain sovereignty, process transactions quickly and communicate with other blockchains in the ecosystem, making it optimal for a variety of use cases.”
Cosmos can be defined as a new ecosystem composed of Blockchains networks. Blockchains that are within the ecosystem can interact with each other freely. Cosmos solves a problem inherent in all first generation Blockchains such as Bitcoin and second generation Blockchains such as Ethereum: the problem of the interconnection between various Blockchains. The ecosystem of Cosmos is based on a network of Blockchains that are independent of each other, such as Bitcoin and Ethereum; but they can also implement all kinds of interchain transactions.
Cosmos explains that “this vision is achieved through a set of open source tools like Tendermint, the Cosmos SDK and IBC designed to let people build custom, secure, scalable and interoperable blockchain applications quickly”. You can even build in Cosmos using your favorite language. One crucial element is Tendermint. This is explained as “a solution that packages the networking and consensus layers of a blockchain into a generic engine, allowing developers to focus on application development as opposed to the complex underlying protocol. As a result, Tendermint saves hundreds of hours of development time.”
Developers who want to build their own Blockchains and want to run their own applications with Cosmos and Tendermint, will find the process extremely smooth and easy to control, in comparison with building their Blockchains from zero, no matter if they are interested in building public Blockchains or private ones, on top of the Tendermint Core engine. “If the application defines that validators are elected based on how many tokens they have at stake, then the blockchain can be characterized as Proof-of-Stake (PoS). If however the application defines that only a restricted set of pre-authorized entities can be validators, then the blockchain can be characterized as permissioned or private. Developers have all the freedom to customize the rules that define how the validator set of their blockchain changes.”
“Tendermint Core reduces the development time of a blockchain from years to weeks, but building a secure ABCI-app from scratch remains a difficult task. This is why the Cosmos SDK exists.” “Cosmos is an ecosystem of blockchains that can scale and interoperate with each other. Before Cosmos, blockchains were siloed and unable to communicate with each other. They were hard to build and could only handle a small amount of transactions per second. Cosmos solves these problems”
Now, what is ATOM? ATOM is a Token-type cryptocurrency that fuels the Cosmos ecosystem of Blockchains by providing support to validation of transactions inside the ecosystem and by serving as a medium of payment for transaction fees at the nucleus of Cosmos. ATOM reached cyryptomarkets in 2017 through an ICO where 168 million of tokens were sold, according to official data.
Thought the ICO, $17,300,000 were collected in 28 minutes. Since that moment, the team has been releasing periodical announcements on their progress for the implementation of the platform. According to website, the present status is “BLASTOFF – Cosmos Hub Launched Mainnet has launched successfully on March 13th.” Besides the main currency of the system, ATOM, Cosmos has also been implementing “Photons”, or tokens that can be used to pay for blockchain fees (similar to NEO’s GAS token).
This is an extraordinary year for Cosmos both at the level of technological achievements -its platform is being a huge success at the engineering and proof-of-concept level- and also at the market level, since the ATOM cryptocurrency has penetrated many markets. Highlights show that, in a dramatic and very notorious manner, one of the exchanges that seemed not ready to integrate ATOM, has yielded to the seduction of the concept and the seriousness of Cosmos: Binance. Today, the news the big news seems to be “Cosmos enters Binance”. This represents a step towards the future for Cosmos and a deserved reward for the efforts. Cosmos represents a golden opportunity for anyone who dreams of developing new technology and applications on a customed Blockchain. Having your own Blockchain will never be as difficult as before.