Cosmos, a project in the blockchain industry, prides itself on addressing some of the most challenging problems facing the sector. Among its objectives, the project aims to offer a solution to the “slow, expensive, unscalable, and environmentally harmful” proof-of-work protocols, used by Bitcoin, by creating an ecosystem of interconnected blockchains. Additionally, the project seeks to simplify blockchain technology for developers by providing a modular framework that eases the creation of decentralized apps. Moreover, the project features an Interblockchain Communication protocol that allows blockchain networks to communicate with one another, reducing the fragmentation of the industry.
The project traces its roots back to 2014, with the founding of Tendermint, a significant contributor to the network. In 2016, a white paper was published, and a token sale was held the following year. The ATOM tokens are earned via a hybrid proof-of-stake algorithm, which enhances the security of the project’s flagship blockchain, the Cosmos Hub, and also plays a role in the network’s governance.
The Cosmos network comprises three layers: the application layer, the networking layer, and the consensus layer. The application layer processes transactions and updates the network’s state, while the networking layer facilitates communication between transactions and blockchains. The consensus layer is responsible for enabling nodes to agree on the current state of the system. The project employs an open-source toolkit to connect the various layers and allows developers to build decentralized apps.
At the core of the project’s design is the Tendermint BFT engine, which enables developers to create blockchains without having to code them from scratch. With Tendermint, critical processes like p2p network, consensus algorithm, and transaction processing are bundled into a single package, simplifying the development of blockchain applications.
The Cosmos Hub, the first blockchain established on the Cosmos network, acts as a mediator between the various unique blockchains, referred to as “zones,” that make up the network. The validators of the Cosmos Hub are responsible for ensuring consensus across all the zones and earning fees for their efforts. The native token of the Cosmos Hub is ATOM, which is utilized to pay these fees.
Tendermint Byzantine Fault Tolerance (BFT) is the backbone of Tendermint, a Proof-of-Stake (PoS) governance mechanism that ensures the computers running Cosmos Hub remain in sync. The system employs the Tendermint BFT consensus algorithm, which is a variant of PoS, where validators take turns committing new blocks of transactions to the chain.
The Cosmos team has also created the Cosmos software development kit (SDK), which utilizes Tendermint’s consensus algorithm to create blockchains. The SDK follows a modular philosophy, allowing developers to incorporate different modules to build the kind of blockchain they need. Furthermore, the SDK is compatible with various programming languages, making it accessible to a more extensive range of developers.