Cosmos (ATOM) Aiming to Become the Grand Central Station of

Crypto and noncrypto

Cosmos is a new cryptocurrency platform that envisions connecting all existing public or private ledgers via a single hub aptly named the “Cosmos Hub.”

A major challenge in today’s crypto world is that most cryptocurrency distributed ledgers exist as isolated silos, unable to communicate with each other, even unaware of the other’s existence.

The vision of Cosmos developers: To end this isolation via the Cosmos Hub, letting users exchange the coin of one ledger for the coin of another ledger without going through a centralized exchange.

And here’s the biggie: By so doing, they aim to infuse more value into the entire crypto universe.

A bold claim? Absolutely! But not necessarily a grandiose illusion. It may be more realistic than it seems at first blush.

We say that because the world is full of public ledgers that shine in some areas, but are lackluster in others:

POS — excellent for distributed applications (dApps) that don’t require high security, such as gaming or gambling … but not at the top of our list for security.

Ethereum — great for dApps that focus on low-frequency, high-value transactions (such as big-ticket lending or trading); not-so-great for dApps designed for high-frequency, low-value transactions (like games).

Bitcoin — is the best and most secure for storing value; not so good or efficient for other applications.

Each is strong in one mission-critical function; weak in another.

But now, imagine what might be possible if all three could be interconnected in such a way that new applications readily leverage the strengths of all three?

That’s a very big deal.

I venture to say that killer dApps/apps of the future are almost certainly going to require interconnection among the world's public ledgers in precisely this way.

The Cosmos Hub Features Speed and Finality

By maximizing both speed and finality, Cosmos is particularly well-suited for connecting distributed ledgers built on the same technology.

But there’s one fly in the ointment. To determine when a transaction has settled, Bitcoin and Ethereum use what’s called “probabilistic finality.”

In other words, even when a transaction is deemed “settled,” it is not settled in the way traditional financial transactions are. There’s always a lingering chance, albeit highly improbable, that the transaction could be challenged, even reversed.

This fundamental difference makes it somewhat difficult for Ethereum, Bitcoin, and many others like it to connect to the Cosmos Hub.

To address this sticky issue, the Cosmos team came up with something called a "Peg Zone." I won’t bog you down in the details. Suffice it to say that the Peg Zone has an unwelcome side effect: It often makes it slow and cumbersome to go through the Cosmos protocol to “talk” to Ethereum or Bitcoin. Like trying to reach your cousin via an old-fashioned telephone operator.

We think there are better ways to solve this problem without slowing everything down. But we don’t see this as a deal killer for Cosmos.

https://v1.cosmos.network/resources/whitepaper