What Is Cosmos Hub (ATOM)? How It Works & Where To Buy It?

Cosmos is an innovative array of networks and tools to create interoperable blockchains. Its native utility token is ATOM – it’s the 22nd largest cryptocurrency by market cap.

The main chain of Cosmos hub acts as the core ledger for adaptable blockchains. Compatible blockchains linked to the Cosmos blockchain are called zones.

The aim of Cosmos is to facilitate blockchain interoperability – it is commonly dubbed the internet of blockchains.

 

How Cosmos Hub (ATOM) Works

Cosmos has pioneered the creation of a system whereby the primary Cosmos blockchain is interconnected to a network of interoperable and customizable blockchains (zones) that operate on the Proof of stake (POS) Cosmos mainnet.

Zones benefit from network security, and the Cosmos hub facilitates the exchange of data. Cosmos utilizes its consensus algorithm called the Tendermint consensus mechanism.

The native utility token, Atom, is used to pay for transaction fees and engage and interact with decentralized apps in the cosmos ecosystem.

Essentially, the cosmos network can be divided into three unique layers:

1. The Networking Layer – Facilitates the confirmation of transactions and communication between hub blockchains.
2. The Application Layer – Responsible for processing and updating the core network with information involving transactions and balances.
3. The Consensus Layer – Facilitates how nodes reach consensus (agreement) when finalizing transactions.

 

Tendermint powers this all and ensures that the integrity, security, and efficiency of these layers are upheld. This allows developers to seamlessly build custom blockchains and partake in the Cosmos network.

 

What Is Cosmos Hub (ATOM) Used For?

Zones, which are custom Cosmos blockchains, are commonly referred to as sidechains. These can be likened to sidechains in familiar blockchains like Polygon.

Each zone can optimize specific integrations, such as authenticating its transactions, deployment of tokens, and various other customized developments. What makes this infrastructure unique is the ability for zones to be interoperable – positioning Cosmos as the internet of blockchains.

This is possible through an inter-blockchain communication protocol unique to the Cosmos network. Inter-blockchain communication protocol facilitates communication across various sovereign blockchains. Cosmos hub mainnet is the primary network or root network which enables and facilitates functionality for customizable blockchains.

Additionally, an innovative architecture named the Hub and Spoke facilitates seamless integration, communication, and sharing between zones – this is permissionless. However, the refusal and acceptance of interconnectivity between other zones are controlled by specific zones and hubs.

Essentially, a blockchain can integrate with zones linked to the same hub. This has positioned Cosmos with unique value proponents compared to other blockchain systems. Cosmos hub validator nodes are responsible for the security, integrity, and efficiency of transactions in the Cosmos network.

Developers can also utilize the Cosmos software development kit (SDK) to customize their blockchains, edit functionality and make custom deployments.

Cosmos relies on the ATOM token to power the decentralized future it creates. ATOM is utilized for transaction fees and interaction with decentralized applications in the Cosmos ecosystem.

Nodes are staking ATOM validate transactions and receive rewards accordingly – the larger the stake, the more validation the node accounts. They are required to stake ATOM to qualify as a validator.

ATOM holders use their tokens to participate in decentralized finance in the Cosmos ecosystem, much like ETH holders use ETH to perform transactions and interact with DApps in the Ethereum ecosystem.

 

Where To Buy Cosmos (ATOM)

ATOM tokens are available to purchase on most major cryptocurrency exchanges.

ATOM tokens can be purchased on several centralized crypto exchanges. But, before you can purchase ATOM, you’ll need to deposit fiat money onto an exchange, and sequentially ATOM tokens will be credited to your ATOM digital wallet on the exchange.

The crypto exchanges below are the safest place where you can buy, sell and store ATOM.

Five of the most popular crypto exchanges are:

1. Binance
2. Coinbase
3. KuCoin
4. HTX
5. Crypto.com

 

All of the above exchanges allow users to buy, sell, transfer and store ATOM in a digital wallet on the exchange. You can use your debit or credit card to purchase ATOM on centralized exchanges.

Users seeking to participate in decentralized finance applications will need to transfer their ATOM tokens to a wallet off of the exchange – users can choose to send them to a wallet such as a Cosmostation wallet.

Once ATOM tokens are in a web wallet, you can stake ATOM, provide liquidity and perform several other actions to generate yields.

How long has Cosmos Hub (ATOM) existed?

Cosmos network was founded by Ethan Buchman and Jae Kwon in 2014. ATOM tokens were launched in April 2019, following an ICO (initial coin offering), which raised $590 million.

What’s controversial about Cosmos (ATOM)?

It’s important to research crypto projects, understand the risks involved and the aims of the project, and have useful insights into the crypto project.

Let’s take a look at the top two controversies surrounding Cosmos Hub (ATOM):

• Founding Team Broke Up – In 2020, a major controversy broke out between members of the Cosmos Foundation. The controversy was fueled because of tensions between Jae Kwon and Zaki Manian. Kwon accused Manian of blasphemy and cited that Manian considered himself a “God” in the space. Cosmos network consists of founders who have publicly criticized one another, which has led to much disbelief in the project by community members.
• Staking Complications – Validators have cited staking issues, highlighting that the three-week staking process causes multiple complications. It also creates complications because if a validator misbehaves, it can result in the stake of ATOM being destroyed.

How many ATOM tokens are there?

At the time of writing, there are currently 286,370,297.00 ATOM tokens.

Can ATOM be mined?

No, ATOM can’t be mined. ATOM tokens can only be obtained through staking.

ATOM holders can, however, generate yields by participating in DeFi apps such as lending protocols and other liquidity provider platforms.

In the future, the internet of blockchains may provide a lucrative way for the ATOM token to add more utility.

What is the market cap of Cosmos (ATOM)?

The market cap of Cosmos Hub (ATOM) is:

Cosmos Hub (ATOM) market cap = total circulating supply of ATOM x current market price of ATOM

Cosmos Hub (ATOM) Market Cap = 286,370,297.00 ATOM x $24.39 = $6.94 billion (22nd largest cryptocurrency market cap)

The market cap fluctuates according to the circulating supply and the market price of ATOM.

Biggest Competitors Of Cosmos (ATOM)

Cosmos has some significant competition, but its most notable competitor is Polkadot. The two blockchains essentially aim to serve similar purposes.

However, one major factor that sets these two blockchains apart is security. Cosmos hub can’t ensure the security of all zones, whereas Polkadot offers unified security for all connected blockchains.

It should be noted that there are several differences, but at the current moment, Polkadot has garnered more attention and a larger market cap ($17.12 billion) than ATOM.

What are the future plans for Cosmos (ATOM)?

The Cosmos network continues to expand and add valuable interoperable networks as it builds the internet of blockchains. The Cosmos SDK makes deploying custom blockchains much more straightforward than ever before.

Its innovative inter-blockchain communication protocol (IBC protocol) and focus on the interchain accounts security will incentivize users to participate in the Cosmos ecosystem.

Optimization of the Cosmos SDK will likely be the value proponent driving user adoption going forward.

Pros and Cons of Cosmos blockchain, Cosmos network, Cosmos ecosystem, and Cosmos SDK

Pros:

• Cosmos SDK – The Cosmos software development kit makes it incredibly easy for developers to focus more on customizing their blockchains and functionality features – with the ease, security, and efficiency of the Cosmos network.
• Zones (Sovereign Blockchains) – One of the greatest advantages Cosmos has is versatility and customized blockchains (Zones) that have interoperability. The hub and spoke architecture enhances inter-blockchain communication (IBC) and streamlines the refusal and acceptance of communication with other zones connected to a hub.
• Cosmos Has Major Partnerships – When researching crypto projects, it’s important to delve into as much information as possible. One of the key factors you should research is the project’s partners – Cosmos has some major partners, which is indicative of the strong backing of the project. Most recently, a gaming partnership with Tendermint core and Forte.
• Growing Ecosystem – Cosmos allows developers to create their blockchain capable of functionality and features, digital processing assets, and support from ATOM node validators (need ATOM staked to become a validator). All of this indicates a healthy, innovative, and ever-expanding ecosystem.

Cons:

• Staking Complications – One con is that staked ATOM is locked in for three weeks. Any validators that misbehave can result in the ATOM tokens being destroyed. Nodes staking ATOM are essentially locked in for a determined period.
• Competition – Although Cosmos has grown extensively recently, it still faces very significant competition from projects such as Polkadot.

  Polkadot has garnered immense investment and attention and has grown to become the 13th largest cryptocurrency globally. Both Cosmos along with its digital assets serve to fulfill similar purposes to Polkadot.

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