Cosmos Network (Cosmos) is an expanding network of interconnected blockchains and distributed ledgers. It is often described as the ‘internet of blockchains’ as its decentralised network of blockchains are interconnected. This network is made up of so-called ‘zones’—each of which is sovereign and can connect to the Cosmos Hub. Together, this interconnected system of one hub and many zones is what makes up Cosmos.
The Cosmos project is led primarily by Tendermint Inc (the Team). Tendermint is a group of software developers who help run and support the Tendermint consensus and networking layer. Interchain Foundation is a Swiss-based non for profit that help coordinate the development of the Cosmos ecosystem.
Cosmos works with 3 key pillars: the Cosmos Hub, Cosmos SDK and IBC Protocol.
- The Cosmos Hub allows blockchains to intercommunicate without having to establish dedicated connections. It’s the first of many hubs. It was deployed in 2019. (Read the Cosmos Hub paper, published on Sep. 26, 2022.)
- The Cosmos SDK is a framework for building custom blockchains that are compatible with the Cosmos Hub. An increasing number of blockchains are being built with the Cosmos SDK.
- The IBC Protocol is a standardised interoperable protocol that connects customised blockchains. This allows chains to transfer tokens or data to each other.
Other terms related to Cosmos are listed below.
- CosmWasm: a framework for building smart contracts in WebAssembly (Wasm) for the Cosmos SDK. (More on CosmWasm.)
- Tendermint Core: an open-source implementation of Tendermint. (More on Tendermint Core.)
- Application BlockChain Interface (ABCI): a protocol that connects a state machine and a consensus engine like Tendermint.
ATOM Token Utility
Cosmos’ native token is ATOM which has no maximum supply. ATOM helps secure Cosmos and it is also the Cosmos Hub’s primary token. It functions similarly to gas in Ethereum, as it’s used for transaction fees when routing transactions. It has 2 other use cases:
- Staking: Cosmos uses a proof-of-stake (PoS) system to help secure its network. (More on staking.)
- Governance: ATOM holders may govern the Cosmos Hub by voting on proposals with their staked ATOM.
ATOM distribution (%): seed round (5.1%), strategic holdings (7.0%), public fundraiser (67.9%), All in Bits, Inc. (d/b/a Tendermint) (10.03%) and Interchain Foundation (10.0%).
In future updates known as ‘Interchain Security’, bigger Cosmos chains, such as the Cosmos Hub (ATOM) will harness their validators and security—to help smaller chains that have weaker security. ATOM could serve a greater role in helping secure a wider range of blockchains in the Cosmos ecosystem.
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