What is Cosmos?
Cosmos is a decentralised network of blockchains that is described by the team as the “Internet of things” that solves the problem of both scalability and interoperability issues. Scalability is the potential of a crypto to manage a great number of crypto transactions at a time. The biggest and most famous blockchains, Bitcoin or Ethereum, are a few examples of scalability issues. Bitcoin can manage only 4.6 transactions per second (4.6 TPS), while the Ethereum blockchain can handle 25 (25 TPS).
If you are wondering what you can do with your crypto, you can stake Cosmos cryptocurrency. One such platform where you can do this is in Trust Wallet. When you stake your cryptocurrency, rewards will be generated automatically.
The Cosmos network is built on three main key features that are ABCI, Cosmos SDK and Tendermint core:
Application Blockchain Interface (ABCI)
ABCI (Application Blockchain Interface) is a component of the tendermint system. This is a programming language related and allows all developers to build the part of application of their blockchain in any programming language that they want. One big advantage of ABCI is that it is not constrained to any one single programming language developer. ABCI is the main interface that connects Tendermint Core and Cosmos SDK. The ABCI provides three types of connections for the Tendermint Core:
- Mempool connection
- Consensus connection
- Query connection
Cosmos SDK
This place was where developers could build hence it got stuck with the name Cosmos SDK (Software Development Kit). Cosmos SDK is a source for developers and is also known as the Base Coin. This SDK allows developers to build blockchains without having to code them all from the scratch. Developers can take this basic framework that has been provided with pre-built-in tokens, governance, all the basic features that will be required for a blockchain. If developers want to add any additional functions, they can just add them through plug-ins. You can think of this like just being an app or website builder from which you can choose from.
Tendermint Core
Tendermint core is a blockchain application platform that connects the consensus and networking layers to enable communication between the hub and all the zones. Just like a web server that serves web applications/websites, Tendermint serves blockchain applications.
What is ATOM?
The native token that will be used for staking in Cosmos’ network is ATOM.
ATOM is the first Cosmos network token that powers the entire Cosmos Hub (the Cosmos Hub is the base of the Cosmos blockchain). This token will be used as a fee to conduct transactions across the network. This minimal fee helps avoid spamming of the network.
Second, it will be used as a staking token. As explained earlier in our previous articles, staking is the process through which cryptocurrencies are locked mainly to receive rewards. Currently, staking ATOM is supported on websites like Coinbase, but voting is not supported. The stakers have to be honest, if not their staked tokens will be taken away. This encourages nodes to conduct honest behavior as those who misconduct will result in taking away their staked tokens.
And finally, the ATOM token can be used to contribute to the security and governance of the Cosmos Hub. For your information, as said earlier, the Cosmos Hub is the base of the Cosmos blockchain.
Pros and Cons of Cosmos (ATOM)
Pros
- Platform is customizable
- Developers can easily create or issue blockchain platforms.
- Scalable
Cons
- Very strong competition
- Slow development
What can you do after you have bought Cosmos
There are a lot of things that you can do after you have purchased Cosmos, in fact, you can do nearly everything that you can do with your fiat currency. Here are the list of things that you can do:
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You can store in a secure trustable wallet like Binance, Exodus or Coinbase. There are two types of wallets: cold and hot wallet. There are three kinds of cold wallets through which you can store, they are: software, hardware and paper wallet. Software wallets are further classified into desktop, mobile and online wallets. Hardware wallets are mostly recommended as they provide high security. There is another type of wallet called a hot wallet. A few examples of hot wallets are Binance, Coinbase and Exodus.
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Another thing that you can do with your crypto, is to sell it. If you think that it’s the right time to sell, you can do it, but there are lots of ways to do that. You can exchange i t for something, you can sell it and get cash directly or you can ask for cash to be sent to your bank account after you have sold it.
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Another thing that you can do, is to trade with it. This is what most people do once they have some cryptos. They open a crypto exchange wallet account and start trading. A few examples of crypto trading wallets are Binance, Coinbase, Coinbase Pro or Cash App.
Cosmos layers
Cosmos’ network consists of three layers that are:
Application – Responsible for processing transactions and updating the current state of the network.
Networking – Responsible for consensus related messages. It also makes sure that each and every node receives transactions.
Consensus – Responsible for enabling and helping nodes agree on the current state of the system.
Disclaimer: Digital Wallets News does not recommend that any cryptocurrency should be bought, sold, or held by you. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.
