By facilitating communication between previously incompatible blockchains, it allows for the development of new standards in the blockchain ecosystem. Cosmos solves the scalability issue of blockchains through what is atom coin vertical and horizontal scalability solutions. Vertical scalability solutions allow a blockchain to optimize its transactions while horizontal scalability solutions allow blockchains to reach more users.
In contrast, Cosmos uses hubs to allow blockchains to actually communicate with one other. This works through Cosmos’ own tool — Inter-Blockchain Communication (IBC), which it launched earlier this year. Some interoperability solutions don’t try to send tokens between the networks. Instead, they use smart contracts to lock those tokens in on one platform, and then mint a corresponding number of tokenized replicas on the other.
Orchid Protocol
The applications layer consists of blockchain applications that process transactions and update the state of the network. Each of the blockchains on the Cosmos ecosystem is powered by the BFT consensus algorithm. Cosmos uses the Tendermint protocol which stands out for its fork accountability, simplicity, and performance. On top of this, the Stargate upgrade brings with it automatic upgrades, full-featured light clients, and efficiency gains of 100x, making Cosmos a force to be reckoned with.
The Cosmos Hub could become the gateway for all financial transactions that move across different blockchains. The team has delivered what it had promised and it’s on the way to surprise the blockchain community with new technological advancements. The latest rollout of Inter blockchain Communication (IBC) protocol has once again proven the strength of its developers. ATOM token is one of the hottest coins that made its way into the list of top 20 cryptocurrencies by market cap. Any blockchain can use the network to establish a connection with any other blockchain for seamless operation. The team withheld 50 million tokens which comes as a strategic move to fund and develop the COSMOS ecosystem which includes marketing and business development.
Theta Network
These blockchains end up operating separately thus limiting the ability to transfer tokens between blockchains. Horizontal scalability occurs when a blockchain can have multiple parallel chains running on the same application and with a common set of validators. This theoretically makes a blockchain application infinitely scalable. Cosmos Hub can connect to other blockchains through Inter-Blockchain Communication. It also keeps track of token types and the number of tokens in each connected blockchain. Validators stake or lock their ATOMs and run specialized software, which maintains the Cosmos network by proposing new blocks and validating transactions.
As you should expect, content on HelloCrypto is not to be construed as investment or financial advice. Content published here are based on our opinions, ideas and on providing information we hope can help our audience to evaluate and navigate the wide world of crypto. ATOM has grown in popularity to become one of the top 100 cryptocurrencies. With a market capitalization of $9,397,188,568.12, ATOM has a market rank at #20. Relying on one coin as part of an investment strategy can quickly backfire on you.
Usability and Sovereignty of Blockchains
That’s probably the main reason why Binance built it on top of Cosmos. That means any future cross-chain transactions on Binance DEX will likely pass through Cosmos Hub. Ethermint worked exactly like the original blockchain and it was also compatible with the DAPPS and smart contracts running on the Ethereum blockchain. As a result, we witnessed the growth in COSMOS ecosystem where the top players like Binance, LOOM jumped onto the network to use it’s technology to better their work. The holders of tokens will have the voting rights to vote for the network proposals that decide the future of the COSMOS blockchain. Uniswap Exchange UNI token is the prime example of a governance token.
Taken all together, the Tendermint Core provides consensus on the Cosmos Hub, while zone blockchains maintain their own consensus without needing to use Tendermint. Given the recent launch of the Inter-Blockchain Communication Protocol on Cosmos I’d say they can. It took 5 years of research and development, but with the March 29, 2021 launch of the IBC https://www.tokenexus.com/ different networks are now able to use Cosmos to exchange tokens and data seamlessly. The Cosmos Hub is like a mission control centre, and all of the Zones (independent blockchains) are spaceships or satellites that Cosmos Hub communicates with and ensures the safety of. Binance is one of the world’s largest and most popular cryptocurrency exchanges.