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The Internet of Blockchains: An In-Depth Look at Cosmos (ATOM)
The Cosmos Hub serves as the foundational blockchain protocol for a growing number of blockchains within the Cosmos Network, enabling them to interact. It operates akin to sharing files across different operating systems on a computer.
Overview
The Cosmos Hub is engineered to spawn numerous interconnected blockchains within the Cosmos Network. Driven by the ATOM cryptocurrency, the Cosmos Hub employs a proof-of-stake consensus mechanism, allowing users to "stake" their ATOM coins and earn rewards. This hub incorporates several innovations to simplify software development, enhance performance, bolster security, and establish an interoperable blockchain infrastructure.
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The Cosmos Hub is the underlying blockchain protocol for a growing array of blockchains within the Cosmos Network, facilitating their communication. It operates similarly to file sharing among various operating systems on a computer. While Cosmos supports multiple tokens, its native cryptocurrency, ATOM, serves as the linchpin for the Cosmos Hub's operations.
Functions of ATOM include:
- Maintaining network consensus
- Enabling staking through incentivized validator nodes
- Mitigating spam by serving as the medium for gas fees
- Facilitating a voting mechanism for proposing network amendments through governance proposals within Cosmos
The Tendermint Core team is developing the Cosmos Hub, which is crucial for the Cosmos Network's design and development. They are instrumental in creating key network infrastructure like the Cosmos Hub, Cosmos SDK, and Tendermint Core, offering advanced tools to fully utilize the Cosmos Network. Through the Cosmos Hub, Tendermint Core builds an interoperable blockchain platform, connecting the protocol with independent blockchains known as zones within the Cosmos Network.
This article will focus on three main components of the Cosmos Network:
- Tendermint Core BFT Consensus: A language-agnostic consensus algorithm created by the Tendermint team, used for state machine replication to replicate other blockchain networks within the Cosmos Network.
- Inter-Blockchain Communication Protocol (IBC): Developed by the Tendermint team as an interoperable communication layer between different blockchain networks.
- The Cosmos Software Development Kit (SDK): An open-source, scalable infrastructure for building multi-asset proof-of-authority (PoA) and PoS blockchain platforms within the Cosmos Network.
Tendermint Core BFT Consensus
Traditional proof-of-work (PoW) blockchain protocols are slow, costly, and face scalability issues. The Tendermint BFT consensus mechanism addresses these challenges by utilizing a proof-of-stake (PoS) consensus algorithm, designed to expedite transaction times.
Tendermint, the consensus algorithm underpinning the Cosmos Network, is a high-performance BFT SMR (State Machine Replication) platform. It replicates services to create deterministic, non-random state machines. Essentially, Tendermint Core replicates specialized servers (or states) through a special machine, distributing them across the global Cosmos Network. This approach allows Tendermint Core to replicate the blockchain on state machines worldwide.
Tendermint's advanced capabilities enable developers to create their blockchain platform without starting from scratch. This streamlines the process, as users can create almost any type of blockchain system they desire, with most components already completed for them, except for their application logic and token. Tokens on the Cosmos Network include Kava (KAVA), Terra (LUNA), Band Protocol (BAND), Aragon (ANT), and Akash Network (AKASH).
ATOM plays a pivotal role in the Tendermint Core BFT consensus mechanism since the Cosmos Hub operates as a proof-of-stake blockchain platform. A 100-validator node network is crucial for consensus, security, and operational efficiency, relying on users to stake their ATOM coins.
Validators run full nodes that verify network rules and broadcast votes to commit new blocks to the blockchain, earning revenue in the form of ATOM based on staked collateral. ATOM also serves as a spam prevention mechanism, discouraging excessive spam transactions. Additionally, ATOM is used for governance voting, enabling Cosmos network participants to vote in proportion to their ATOM holdings.
Inter-Blockchain Communication (IBC) Protocol
The Cosmos IBC protocol addresses a critical challenge faced by blockchain systems today: the lack of communication and data sharing between networks.
Interoperability and the ability to communicate with both external and internal blockchain protocols are crucial for the widespread real-world application and technological adoption of blockchain and cryptocurrency. The Cosmos IBC, akin to TCP/IP, enables various blockchains to share information and data, allowing multiple blockchains to communicate with each other.
Capabilities of the Cosmos SDK
The Cosmos SDK is a scalable, open-source infrastructure for building multi-asset public PoS blockchain platforms like the Cosmos Hub, and permissioned proof-of-authority (PoA) blockchains. It prioritizes simplicity and ease of use, critical for building interoperable, application-specific blockchains efficiently. Unlike virtual machine-based applications, the Cosmos SDK is a modular framework designed to construct application-specific blockchains.
While smart contract technology, typically limited in versatility, sovereignty, and technical performance, is beneficial for specific use cases, application-specific blockchains supported by Cosmos enable individual applications to run optimally, with engineers having the freedom to make structural design modifications as needed.
Developers can utilize pre-built and custom-built modules with the Cosmos SDK, enabling them to test their minimum viable product before launching their public mainnet. Moreover, the Cosmos SDK allows users to connect their blockchain to the Cosmos Network via IBC, enhancing liquidity and user adoption. Several key blockchain and cryptocurrency projects, such as Binance DEX, Kava, Terra, and IRISNet, have been constructed using the Cosmos SDK.
A Universe of Interoperable Blockchains
The Tendermint BFT consensus mechanism, IBC Protocol, and Cosmos SDK simplify how software engineers build blockchain protocols within the Cosmos Network. Many leading blockchain enterprises have already utilized Cosmos' flexible and interoperable framework to establish the core of the Cosmos Network.
The Cosmos Hub is a powerful decentralized blockchain network, with its structure and governance enabling network participants to maintain equanimity. The ATOM coin serves as a staking mechanism, promoting security, consensus, and operational efficiency. The Cosmos Network addresses many interoperability challenges that currently constrain blockchain technology.
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