With the successful integration of Cosmos IBC on the Kava 9 mainnet and the deployment of well-known public chains Terra and Binance Chain in the Cosmos ecosystem, the Cosmos ecosystem has received more and more attention.
Cosmos introduced BPOS (Bonded Proof of Stake consensus protocol), also known as Tendermint. Compared with PoW, this consensus protocol has improved performance and has anti-censorship properties, which a single validator does not have. The Cosmos network also aims to enable blockchain interoperability, and it was the first platform to release such a feature.
Cosmos is also known as a cross-chain duo along with Polkadot. The Cosmos ecosystem continues to prosper and is expected to become the public chain with the most growth potential in 2022.
1. Three major technological innovations of Cosmos
The Cosmos network consists of many independent parallel blockchains. The first blockchain in the network is the Cosmos Hub, and the other parallel chains are called Zones, which perform cross-chain operations with the Hub through the Inter-Chain Protocol (IBC).
SDK and IBC protocol.
1.1 Tendermint Consensus
Tendermint includes two main technical components: the blockchain consensus engine (Tendermint Core) and the common application blockchain interface (Application BlockChain Interface, ABCI). Tendermint Core is the underlying consensus engine based on the Tendermint consensus algorithm, which ensures that all nodes record transactions in the same order. The Tendermint consensus algorithm adopts a very typical Byzantine fault-tolerant scheme, which is a hybrid consensus of PBFT + Bonded PoS (Pledged Proof of Stake).
There are two roles in the Tendermint protocol, verifier: a role or node in the protocol, different verifiers have different vote power in the voting process; proposer: generated by the verifiers in turn. Validators take turns proposing blocks of transactions and voting on the proposed blocks. Blocks are committed to the chain, and each block is a block height. But the block may also fail to submit, in which case the protocol will choose the next validator to propose a new block at the same height and start voting again.
As you can see from the above figure, to successfully submit a block, it must go through two stages of voting, called pre-vote and pre-commit. A block will only be committed when more than 2/3 of the validators have pre-commit votes on the same block in the same round of proposals. Tendermint allows the proposer to fail to propose a block due to offline or network delays.
Assuming that less than one-third of the validators are Byzantine nodes, Tendermint can guarantee that validators will never repeatedly submit blocks at the same height and cause conflicts. To do this, Tendermint introduced a locking mechanism where once a validator has pre-voted a block, that validator is locked in that block. This validator must then pre-vote on the pre-committed block. When the previous round of pre-proposal and pre-voting fails to submit the block, the validator will be unlocked, and then the next round of pre-submission of the new block will be performed.
1.2 Cosmos SDK
Cosmos SDK is a toolkit to help developers speed up the development process, and its typical features are modular and pluggable. By using the Cosmos SDK, developers can build their own blockchains or functional components based on the Tendermint consensus algorithm.
Cosmos SDK is currently the most advanced framework for building customizable dedicated blockchains. The advantages of Cosmos SDK can be summarized as follows:
The default consensus engine of the Cosmos SDK is Tendermint Core. Tendermint is currently the most mature and only BFT consensus engine. It is widely used in the industry and is considered to be the best standard consensus engine for building POS systems.
The Cosmos SDK is open source, and you can easily build blockchains through composable modules. With the development of various open source modules in the SDK ecosystem, it will become easier and easier to build complex decentralized platforms through the Cosmos SDK.
The Cosmos SDK is inspired by function-based security and benefits from years of experience in blockchain state machines. This makes the Cosmos SDK a very secure environment for building blockchains.
The Cosmos SDK has built several dedicated blockchains in operation. For example, Binance Chain, Terra and Kava etc.
Cosmos SDK provides developers with great convenience and shortens the development cycle of developers. Both public proof-of-stake and private permissioned proof-of-authority blockchains can be built using the Cosmos SDK.
1.3 IBC Protocol
IBC is a cross-chain communication protocol designed by Cosmos for communication between Hub and Zone to achieve cross-chain interaction. IBC is the core part of Cosmos. In April 2021, the official operation of the IBC protocol is a milestone event. After the launch of IBC, the data is very impressive. As of January 28, 2022, 28 main chains have been running on IBC, and a total of 5.1 million IBC transactions have occurred in the past 30 days.
The goal of IBC is to transfer application information between two independent seven-layer networks, so the relay outside the chain is required to relay the data packets between the networks of chain A and chain B. After chain B receives the data of chain A, it must be able to independently verify the proof information it contains, which represents the authenticity of a certain state (and its corresponding operation) on chain A. In order for the IBC protocol to work, it must rely on the basic trust mechanism, trust the respective consensus algorithms in chain A and chain B, and trust the light client verification. what happened
The principle of IBC is that the blockchain independently verifies the transaction information transmitted across the chain. Transaction information on any blockchain can be transmitted and interacted based on the IBC cross-chain protocol. Therefore, in addition to the transfer of the simplest token, it can also support the transfer of NFT, the invocation of smart contracts, and so on.
In 2022, the IBC protocol also plans to cross-chain networks such as Bitcoin, Ethereum, Polkadot, Avalanche, Harmony, and Celo, further unlocking the massive liquidity of the blockchain.
2. Cosmos economic model
The initial supply of ATOM is 200 million pieces. As of January 28, 2022, the latest price of Astro Boy (ATOM) is $29.62, and the 24-hour trading volume is $1,732,782,563. The price of ATOM has dropped -2.33 in the past 24 hours %. The circulation of Cosmos is: 226 million ATOM, the maximum supply: 284 million, the total supply: 284 million, the circulation rate: 79.65%, the circulating market value is: $6,701,878,211, and the total market value ranks 20.
2.1 Allocation Mechanism
The initial distribution of Atom tokens and validators will be 75% of the Cosmos public offering participants, 5% of the pre-sale, 10% of the team, and 10% of the Cosmos Foundation. Starting from the genesis block, 1/3 of the total amount of Atoms will be distributed as rewards to the validators and delegators bound each year. The benchmark price for ICOs (seed rounds, strategic rounds and public sales) is 0.1, with discounts of 25% and 15% for strategic investors and seed investors, respectively.
2.2 Release mechanism
The model adopted by ATOM is an inflation increase type, with an increase rate of 7% to 22%, and the specific proportion is based on the current number of Atom Staking. When the amount of Stake is greater than 1/3 of the total amount of Atoms, the issuance rate is 7%; when the amount of Stake is less than 1/3, the issuance rate is 20%~22%.
2.3 ATOM usage rights, revenue rights and governance rights
2.3.1 Right of use
For usage rights, ATOM is required to perform transactions and other operations in the Cosmos Hub. Although there will be other Hubs in the future ecology of Cosmos, the Cosmos Hub must be the core Hub. After the realization of IBC, the application value of Cosmos Hub will be significantly improved, and a large part of the value in the ecology will converge to Cosmos Hub, and users’ use of ATOM will also increase.
2.3.2 Benefit rights
The right of income is mainly reflected in the fact that users obtain inflationary income by staking ATOM, and some speculators hold ATOM waiting for appreciation.
For governance rights, one is that users pledge ATOM to vote for validators, and the other is that users participate in voting for various governance proposals in the ecosystem.
The governance mechanism of the Cosmos Hub is on-chain governance. Any user can submit a governance proposal, which is then voted on by ATOM holders. If the proposal is passed, the corresponding upgrade will be performed. At present, Cosmos has voted on governance proposals for many times, and the voting participation rate is basically higher than 50%, and the community’s enthusiasm for participation in governance is relatively high.
3. Items worthy of attention
As of January 28, 2022, the Cosmos official website shows that the assets have exceeded 130 billion, and there are more than 262 Dapps. Projects including IRISnet, Starname, Sentinel, Crypto.org, and Regen Network have all been built in Cosmos. This report focuses on Secret Network, Osmosis, Juno Network, kava, and Terra.
3.1 Privacy Track — Secret Network
Secret Network is the first blockchain with privacy-preserving smart contracts, which is developed based on Cosmos technology and plays an important role in the Cosmos ecosystem. Applications built on Secret can use encrypted data without permission from anyone (even nodes in the network). This unique capability protects users, secures applications, and unlocks hundreds of unprecedented Web3 projects.
Another noteworthy point of Secret Network is that it was formerly known as Engima. Egnima was born at the Massachusetts Institute of Technology in 2015, namely MIT Media Lab. The founder and CEO is Guy Zyskind. Guy Zyskind is from a top American school. He founded Engima in MIT Media Lab and became a star project in 2017.
In addition, Secret Network has also received investment and financing from top institutions. On January 20, 2022, Secret Network announced that it has received $400 million in ecosystem funding, including a new $225 million ecosystem fund and a $175 million accelerator pool. Investors include DeFiance Capital, Arca, Alameda Research, ArkStream Capital, Bison Fund, CoinFund, Dragonfly Capital, Fenbushi Capital, HashKey Capital, Huobi Capital, Kucoin Labs, NGC, etc.
As of January 28, the latest price of Secret Network (SCRT) is $5.67, and the 24-hour trading volume is $31,811,697. The price of SCRT has increased by 2.78% in the past 24 hours. The circulation of Secret Network is: 150 million SCRT, the maximum supply: 190 million, the total supply: 190 million, the circulation rate: 78.78%, the circulating market value is: $849,769,796, and the total market value ranks 97th.
3.2 DEX – Osmosis
Osmosis is a decentralized exchange (Dex) in the AMM (Automated Market Maker) model, extending the use of AMM to the Cosmos ecosystem. Simply put, an automatic market maker allows users to provide liquidity in the market in a non-custodial form, become a small market maker, and then share transaction fees. While other users can freely trade different tokens through the existing liquidity, the model is a decentralized exchange.
Now Osmosis has supported 32 kinds of tokens: ATOM, OSMO (Osmosis’s native token), ION, AKT, DVPN IRIS, CRO, XRPT, REGEN, UST, etc., truly realizing the free conversion between different chains, and The speed of personal account arrival can be measured in seconds, and the handling fee is almost negligible. Additionally, the APR staked on Osmosis is very substantial.
As of January 28, the latest price of (OSMO) is $7.88 and the 24-hour trading volume is $214,427. The price of OSMO has dropped -4.37% in the past 24 hours. The circulation of Osmosis is: 186 million OSMO, the maximum supply: 1 billion, the total supply: 325 million, the circulation rate: 57.32%, the circulating market value is: $1,468,387,592, and the total market value ranks 56.
3.3 Smart Contract Platform – Juno Network
Officially launched on October 1, 2021, the Juno mainnet is a fully interoperable smart contract network built with the Cosmos SDK and launched as a hub in the Cosmos ecosystem. Juno’s goal is to offload the computational burden of smart contracts from the Cosmos Hub itself, which can focus on the core activities, security, etc. of the wider Cosmos ecosystem.
As a platform-level public chain with the main purpose of carrying the smart contract application ecology, Juno is also constantly promoting the development of its ecology. After several hackathons, the current Juno ecosystem has begun to take shape. While many projects are still in the early stages of development, a number of noteworthy projects have emerged.
Junoswap is a native asset trading platform on the Juno chain. Unlike Osmosis, which caters to this or that Cosmos ecological asset trading needs, Junoswap’s goal is more for local CW20 asset trading in the Juno ecosystem.
JunoMint is a one-click issuance platform for CW20Token on Juno. With JunoMint, users no longer need to deploy smart contracts directly, but can issue their own project Tokens with one click by directly filling in core parameters such as Token name, decimal places, and total supply. In addition, JunoMint also provides a variety of templates for users to choose from.
DAO DAO is a decentralized collaborative organization creation tool on Juno. Similar to JunoMint’s design logic, it simplifies the original complex smart contract deployment work into a standard one-click deployment user interface. Users can directly create DAOTokens, set voting rules, etc.
At present, Juno has deployed 44 applications. In addition, Juno also has a noteworthy point of participation in staking on the Juno main network, and may receive airdrops.
As of January 28, Juno (JUNO) last price was $16.44 with a 24-hour trading volume of $3,622,083. The price of OSMO has dropped -2.2% in the past 24 hours. The circulation of JUNO is: 39,103,717 JUNO, the maximum supply: 185,562,268, the total supply: 71,739,986, the circulating market value is: $643,146,212, and the total market value ranks 118.
3.4 DeFi Application – kava
Kava (zh.kava.io/) is the first DEFI platform based on the Cosmos cross-chain, built on the Cosmos SDK, and operates with a Tendermint-based Proof of Stake (PoS) consensus mechanism. On the application side, Kava has created two applications, the lending platform CDP and the cross-chain currency market HARD Protocol, providing stable coins, loans and interest-bearing accounts, allowing users to use digital assets to obtain more usage scenarios and value. The KAVA coin is generally similar to the Maker mechanism. The main differences lie in its different collateral assets, as well as the difference in the PoS mechanism of the native token pledge verification transaction and the token capture value mechanism.
On January 20, 2022, KAVA9 will be launched, KAVA9 will be launched, and the upgrade of the Kava 9 mainnet will connect Kava with cosmos and release new assets and revenue opportunities through the integration of the IBC protocol. Based on the Layer-1 public chain of the Cosmos SDK, the upgrade of Kava 9 greatly expands the Kava ecosystem. The integration of IBC allows both new users and projects to gain more high-yield opportunities across chains, and it also opens up new usage scenarios for existing Kava native assets.
The upgrade of the Kava 9 main network has further prospered the IBC ecosystem, and the Cosmos main chain will also be fed back. But the concern is that as more and more chains are added, it seems that the Cosmos hub itself will eventually face bottlenecks, and probably eventually they will also have to move to scaling mechanisms etc.
As of January 28, the latest price of Kava (KAVA) is $3.22, and the 24-hour trading volume is $83,098,779. The price of KAVA has increased by 6.11% in the past 24 hours. The circulation of Kava is: 149 million KAVA, the maximum supply: unlimited, the total supply: 154 million, the circulating market value is: $478,374,513, and the total market value ranks 151.
3.5 Earth （UST
Terra is a Tendermint blockchain based on Cosmos IBC with the advantage of interoperability with any other IBC blockchain in Cosmos IBC, allowing for easy collaboration or cooperation with other projects in the Cosmos ecosystem in the future. At present, the Terra ecosystem has covered stablecoins (UST), synthetic assets, machine gun pools, real-world payments and other scenarios. Terra takes stablecoins as its core, and connects its stablecoins with the real world through a variety of DeFi products to achieve a real commercial landing.
Terra is currently the leader in the Cosmos ecosystem. But it remains to be seen whether Terra’s stable UST can skip the “death melody” of stablecoins, especially with the current market instability.
As of January 28, the latest price of Terra (LUNA) is $53.67, and the 24-hour trading volume is $2,575,455,758. The price of LUNA has dropped -5.16% in the past 24 hours. Terra’s circulation: 406 million LUNA, maximum supply: 1 billion, total supply: 819 million, circulation rate: 49.56%, circulating market value: $21,774,023,748, ranking 9 in total market value.
The latest price of TerraUSD (UST) is $0.9987 with a 24-hour trading volume of $895,002,221. The price of UST has dropped -0.25% in the past 24 hours. The circulation of TerraUSD is: 11.252 billion UST, the total supply: 11.252 billion, the circulation rate: 100%, the circulating market value is: $11,239,931,013, and the total market value ranks 16th.
4. Cosmos ecological airdrop
As of January 28, many airdrops in the Cosmos ecosystem have ended snapshots, such as Evmos, etc., but there are more airdrops in the Cosmos ecosystem that deserve our attention. Some projects in the picture below are worthy of attention.
After nearly five years of development, the Cosmos ecological layout has been gradually improved. This report is only a bird’s-eye view of the Cosmos ecology. In 2022, with the rise of the cross-chain trend, the improvement of the IBC ecosystem, the launch of Interchain Security and more airdrops under the Cosmos ecosystem, the Cosmos ecosystem will also receive more attention.
Written by: Hoo Research
1、Cosmos Official Website
3、Cosmos profile on Messari
4、The Cosmos Hub Roadmap 2.0
5、Why Blockchains Need Cosmos Proof-of-Stake for a Sustainable Environment
7、Deep Dive: How Will IBC Create Value for the Cosmos Hub?
8、Build Your Blockchain with Starport and Connect to a $75B+ Ecosystem of Digital Assets
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/how-does-cosmos-achieve-chain-to-chain-ports/
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