Cosmos, The Future Of Interoperability?

By September 23, 2022Polkadot
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Very good crypo readers, in my opinion, and in the opinion of many experts that I have read, the future of crypto is heading towards interoperability, that is, the ability of different blockchains to communicate with each other. We could say that Polkadot and Cosmos are ahead in this field, in this article we will talk specifically about Cosmos, because between the two blockchains, I think Cosmos is ahead and presents a more promising technology. Let’s break down point by point what makes it so special, so let’s get started!

Cosmos (Atom) is a blockchain that allows other blockchains to be built on top of it, this is known as a Layer 0. The great advantage of building on top of Cosmos is that a new blockchain would not need to start from scratch, by connecting to Cosmos it can make use of its validators and inherit its security.

Comos is, therefore, a blockchain focused on interoperability and to achieve this, it is based on three key technologies:

  1. Tendermint Core (TC)
  2. Cosmos SDK
  3. Inter Blockchain Communication Protocol (IBC)


Tendermint Core is a system that helps keep the Cosmos network running smoothly. It is based on a Byzantine Fault Tolerance (BFT) protocol, which means that even if some of the network’s validators (nodes) fail or behave badly, the network can still function. Tendermint is a type of consensus called Proof-of-Stake (PoS), which allows up to 33% of nodes to fail without affecting the network. What makes Tendermint Core special is that it combines the networking and consensus layers, which makes it scalable. This means that developers can focus on creating applications without worrying about the underlying mechanics.

The Cosmos Software Development Kit (SDK) is a set of tools that allow developers to create decentralized applications (dApps). The SDK also allows developers to build sovereign blockchain apps, which are called zones. These zones serve as smart contracts and replace the need for single Layer 1 chains. This way, it is possible to create an inter-linked zone hub, which powers Cosmos’ cross-chain interoperability. The Cosmos Hub is the central hub that all zones are connected to. This allows zones to interact with each other without having to build a separate blockchain for each one, this not only saves time and money, but it also speeds up transactions and avoids high transfer fees.

The IBC protocol connects different zones, blockchains and layers of Cosmos. This allows blockchains to exchange data, tokens and more with other chains in Cosmos. IBC allows, in short, cross-chain compatibility without relying on a trusted third party. The result of this is that the ability of blockchains to communicate with each other without trust helps to unify blockchains in Cosmos.

Currently the Atom token has poor tokenomics and poor value accumulation due to the lack of token utility, which are mainly transaction fees and governance. Since the Cosmos SDK allows developers to activate their own PoS blockchain for free it does not accrue value to the Cosmos ecosystem. Another weakness is that it has infinite supply and high inflation. Recently Cosmos announced the new Whitepaper 2.0, which will be presented at Cosmoverse on September 26–28. Rumor has it that it will bring a revamped tokenomics that fixes its main weaknesses, which as we have explained, make it unattractive.



With this module, developers can launch a new blockchain and secure it using another blockchain’s set of validators. For example, the Cosmos hub is one of the largest Cosmos blockchains, and its validators are backed by ATOM. With ICS, validators from a vendor chain, such as Cosmos, can be leased to new blockchains for security which allows them to start developing the blockchain without having to worry about security or validators, among other things. In exchange for providing security to the consumer chain, the supply chain receives some of the transaction fees and some of the wagering rewards. The supply chain can also get additional functionality from the consumer chain.


This module allows for blockchains to securely create and control accounts on other blockchains. This saves time and resources for developers, and allows for a much more seamless and streamlined user experience.
For example, if a user needs money, he can use Carbon’s money market. The user doesn’t have to go to the Carbon blockchain to borrow, lend or leverage, which makes things easier for the user. Another example is that if an application needs a dex, it can use Osmosis on to exchange with high liquidity and low slippage.


This module allows Cosmos chains to query and read data from other Cosmos chains, opening more crosschain possibilities.


The key developers of Cosmos are:

Jae Kwon: Founder & CEO

Zarko Milosevic: CTO

Ethan Buchman: CTO & CO-Founder

In summary, Cosmos presents a very promising technology and is probably the Blockchain best poised, at present, to lead the race towards interoperability. The ability to build complete blockchains on top of Cosmos, allowing to use its validators, which reduces startup costs, makes it possible for developers to focus on attracting value to their blockchains without worrying about security, for example. This coupled with the ability to be able to exchange value between different blockchains as if they were one is certainly a great incentive to build on top of Cosmos.

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