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Cosmos (ATOM) blockchains in and out of the Cosmos Hub

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Direct from the desk of Dane Williams.


Gaining a better understanding of the interoperability of Cosmos (ATOM) blockchains. Chains that use the Cosmos SDK, both inside and outside of the Cosmos Hub.

Blockchain technology has gained widespread attention in recent years as a secure and decentralised way of processing transactions.

However, as the number of blockchain networks and use cases grows, interoperability has become an increasingly important consideration.

The Cosmos (ATOM) blockchain ecosystem offers a unique solution to this challenge by providing a decentralised network of independent blockchains that can easily communicate with each other.

Ultimately allowing for greater interoperability and scalability.

In this blog post I compare chains that use the Cosmos SDK, both inside and outside of the Cosmos Hub itself, to explore the concept of interoperability within the ecosystem.

What is the Cosmos Hub?

The Cosmos Hub can be described as the central point of the Cosmos blockchain ecosystem.

It serves as the main hub connecting all the different independent blockchains that use the Cosmos SDK.

By linking these blockchains together, the Cosmos Hub enables them to communicate and exchange value with each other.

Thus creating a truly interconnected network of networks.

There are several advantages to being a part of the Cosmos Hub.

The major advantage is that being part of the hub provides access to the security and interoperability features that are built into the Cosmos SDK framework itself.

These features help to ensure that transactions between different blockchains are secure and efficient, while also reducing the complexity of operating interoperable systems.

However, it's worth noting here that not every blockchain can simply become a part of the Cosmos Hub.

There are specific criteria that a project must meet before it can be added to the network.

These include factors such as that blockchain's level of decentralisation, security features and overall technical capability.

Are there Cosmos SDK chains outside of the Cosmos Hub?

While the Cosmos Hub is the central point of the Cosmos blockchain ecosystem, it's worth noting that not every project built on the Cosmos SDK is a part of the hub.

Some projects don’t qualify, or simply choose to operate independently of the Cosmos Hub for a variety of reasons.

One reason a project may choose to operate independently is to maintain a unique identity and governance structure.

By operating independently, projects can have greater control over their own destiny and can more easily implement their own specific requirements.

Additionally, some projects may have a specific focus or use case that doesn't necessarily align with the broader goals of the Cosmos Hub.

Regardless of whether a project is a part of the Cosmos Hub or not, the Cosmos SDK offers a range of advantages for building secure and scalable blockchain networks.

The modular design of the Cosmos SDK allows developers to build custom blockchain applications with ease.

As a result, the included developer tools simplify the process of creating and deploying these applications.

There are several blockchain networks that are built on the Cosmos SDK but operate independently of the Cosmos Hub.

One example of such a network is the Akash Network (AKT), a decentralised cloud computing platform that allows developers to manage applications in a secure and decentralised way.

The basic premise is that by using the Cosmos SDK, Akash is able to take advantage of the security features and developer tools provided by the SDK.

All while maintaining its unique identity and governance structure.

How does the ATOM token affect governance of blockchains within and outside the Cosmos Hub?

The ATOM token plays a crucial role in the governance of blockchains primarily within the Cosmos Hub.

ATOM serves as the native cryptocurrency of the Cosmos Hub and is used as the primary means of exchange within the Hub.

The ATOM token is also used to pay transaction fees and secure the network through staking.

In terms of governance, ATOM holders have the power to vote on proposed changes to the Cosmos Hub, such as changes to the network's parameters or the addition of new blockchains.

The more ATOM a holder stakes, the more voting power they have.

This means that larger holders have more influence over governance decisions.

For blockchains built on the Cosmos SDK but operating outside of the Cosmos Hub, the governance structure can vary.

Some of these blockchains may have their own native cryptocurrency that serves a similar governance role to ATOM, whereas others may use a different token or system entirely.

Again using the Akash Network as an example of a blockchain built on the Cosmos SDK, but operating independently of the Cosmos Hub, they’re able to operate as a completely sovereign blockchain with their own governance structure.

Akash has its own native token, AKT, which is used for governance on the platform.

Holders of AKT are able to vote on proposals related to the development, management and governance of the Akash Network.

The proposals can range from changes to network parameters such as transaction fees and block rewards, to more significant changes such as upgrades to the network's underlying software.

In saying that however, the Akash Network also has the ability to participate in the Cosmos Hub's governance through its ATOM holdings.

Remember that at its heart, the Cosmos Hub uses a simple Proof-of-Stake (PoS) consensus mechanism.

So whether they’re a Cosmos SDK project or not, whoever holds ATOM has a say in governance.

It just so happens that right now those within the Cosmos Hub have the most ATOM.

But that’s not to say that things will change further down the line as the ecosystem continues to evolve and decentralise.

Final thoughts on the interoperability of Cosmos (ATOM) blockchains in and out of the Cosmos Hub

By using the Cosmos SDK, blockchain projects can leverage the security, scalability and modular design of the Cosmos network.

All while also maintaining their own unique identities and governance structures.

Being a part of the Cosmos Hub offers benefits such as access to the Hub's security and interoperability features, as well as the ability to participate in the Hub's governance through the ATOM token.

In saying that however, operating independently also certainly has its advantages.

Allowing projects to maintain their own governance structures and to avoid the potential dominance of larger projects within the Cosmos Hub.

Even thought there are inherent centralisation issues that I haven't discussed, the concept of interoperability within the Cosmos ecosystem still gets me excited.

Surely I'm not the only one?

Best of probabilities to you.

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