Cryptocurrency is an ever-evolving space. From monolithic blockchains such as Bitcoin and Ethereum to clusters of blockchains such as Avalanche and Cosmos, cryptocurrency has made massive strides in the past few years.

For crypto novices, the word ‘cryptocurrency’ is synonymous with either Bitcoin or Ethereum. Bitcoin had the first mover advantage and Ethereum had the benefit of real use-case. In the last 2-3 years, the cryptocurrency space has exploded into many more projects–hundreds if not thousands of blockchains aimed at ushering a new era of digital finance.

Within these cryptocurrency blockchains, the Cosmos Ecosystem holds a special place. Why? Because of its unique design.

When most blockchains out there are working on their own, Cosmos Ecosystem is attempting to create a network of blockchains. For example; Bitcoin is a sovereign blockchain that does not connect to any other. It is the same case for Ethereum (Yes, there are L2s, but that’s a different topic).

What is the Cosmos Ecosystem?

The Cosmos Ecosystem can be simply referred to as a collection or a network of blockchains. What this means is, there are sovereign blockchains built on a common foundation. This foundation is named the Cosmos SDK.

What this allows the ecosystem is to have a collection of blockchains that operate on their own–they have their own governance, functionalities, dApps, and more, but also be connected to each other blockchain.

You might be able to visualize this as the Internet–which is essentially a vast collection of websites and applications. This is also why the Cosmos Ecosystem is dubbed the Internet of Blockchains.

The benefit to building a blockchain on the Cosmos SDK is that all these blockchains can be connected via a revolutionary piece of technology called ‘Inter Blockchain Communication’ or ‘IBC.’ In simple terms, all blockchains that opt to adopt IBC will be able to transfer assets between them easily.

Why is inter blockchain communication a big deal?

This is a huge deal because the alternative is to use a ‘bridge’ to transfer assets among blockchains. Crypto bridges, just like their real-life counterparts, facilitate transfer of assets (i.e. tokens or information) between two or more blockchains. And historically, crypto bridges have been very susceptible for hacks and other tech failures.

Below image shows some of the blockchains within the Cosmos Ecosystem and how they are interconnected with each other.

More and more blockchains are being built within the Cosmos Ecosystem every year.

What are some prominent blockchains in Cosmos Ecosystem?

As mentioned before, the Cosmos Ecosystem is a collection of blockchains built on a common foundation. Below are some of the OG blockchains within the ecosystem as of the time of writing this article;

• Cosmos Hub
• Osmosis
• JUNO Network
• EVMOS Network
• Kujira
• Stargaze
• Secret Network
• Injective
• Fetch.ai
• Crescent Network
• Cronos
• Akash

These individual blockchains have their own objectives, roadmaps, and services they offer. Some are NFT marketplaces, some provide infrastructure to the entire ecosystem, some offer DeFi applications, some are meme coins, and so on.

You can checkout the entire Cosmos Ecosystem of blockchains here and learn what they do.

As much as they offer unique services, these blockchains also have their own tokens. And most new projects launching in Cosmos Ecosystem do opt to do airdrops of their native tokens to the active participants within the ecosystem.

What is the Cosmos Hub?

Cosmos Network, Cosmos Ecosystem, and Cosmos Hub maybe a little confusing to newcomers into this ecosystem. So, let us explain.

The Cosmos Network and Cosmos Ecosystem are essentially two names for the same thing. These are terms used to describe the whole ecosystem at large.

The Cosmos Hub, however, is one small, but integral part of the Cosmos Ecosystem. The Cosmos Hub is essentially another sovereign blockchain like every other chain within the ecosystem. But, this is THE OG blockchain. It serves as the central hub for all things Cosmos.

Just as other blockchains, Cosmos Hub has its native token named ‘ATOM.’ Users can buy and stake ATOM tokens to earn rewards in ATOM and in the form of airdrops from other networks. Almost all new blockchains within the Cosmos Ecosystem have decided to airdrop their tokens to ATOM stakers on launch. So, if you are a fan of crypto airdrops, buying and staking ATOM is a good way to position yourself for any future drops. At the time of this article, the ATOM token is trading at $10.77 with a market cap of $3.1 billion and ranks at #23 by market capitalization.

The Cosmos Hub is by far the largest blockchain within the Cosmos Ecosystem right now. However, this crown was held by Terra-Luna network prior to its infamous crash in the middle of May 2022, Terra ecosystem boasted a market capitalization of around $60 billion–its native token Terra-Luna had reached a peak of $119/token in April 2022. As of today, the token trades at $0.00011056!!

Cosmos Ecosystem compared to Ethereum

I fell in love with the Cosmos Ecosystem as it was solving some of the biggest problems with Ethereum blockchain such as transaction speed, high cost of transactions, and scaling limitations. The Cosmos blockchains are much faster and 1000x cheaper than Ethereum transactions.

However, the Ethereum ecosystem is massive compared to Cosmos. Ethereum network has the second highest market capitalization with $227 billion, after Bitcoin. The entire Cosmos blockchains put together only amounts to about $60 billion and $48 billion of this is the Binance network (or BNB chain). However, BNB chain is not connected to the Cosmos Ecosystem via inter blockchain communication nor it is an active participant in the Cosmos ecosystem. Discounting the BNB chain, the rest of the Cosmos Ecosystem only amounts to approximately $11 billion market capitalization–a fraction of Ethereum. This hinders attraction of new users and capital providers.

On the other hand, the Ethereum blockchain is spewing out a new layer on top of its monolithic chain, dubbed Layer 2 or L2. New blockchains are being built on this Layer 2 and are much faster and cheaper than the Ethereum network. So, the Cosmos Network might be losing its faster and cheaper advantages.

The one area that the Cosmos Ecosystem still shines is its interoperability or inter blockchain communication allowing all IBC-enabled blockchains to transfer assets easily between them. This is still a game changer. However, needless to say that competition is catching up.