Why can the price of Cosmos (ATOM) reach a new ATH after a 75% increase?

Blockchain network interoperability is emerging as one of the key issues in the crypto ecosystem in 2022. New users continue to enter the ever-evolving world of crypto as the world of cryptocurrency continues to grow chains that add to their community and Best meet protocol requirements.

The project effectively started in 2022 with a focus on facilitating communication between the discrete networks of the cosmos (ATOM). It calls itself the “Internet of Blockchains” and tries to facilitate the development of a networked decentralized economy.

Data from TradingView shows that ATOM’s price has risen 75% from its low of $ 25.06 on Dec. 30, to a daily high of $ 43.98 on Jan 4th as the 24-hour block trading volume hit $ 2 , Rose to $ 54 billion.

1 day frame ATOM / USDT price chart | Source: TradingView

The three reasons behind the ATOM price spike are the introduction of a cross-chain bridge that makes it compatible with the Ethereum Virtual Machine (EVM) protocol and the upcoming Theta upgrade that is rapidly changing the ecosystem of chains and applications will expand.

Cosmos is roughly compatible with EVM

The most important development that led ATOM to the boom is that mission EVMs, a protocol compatible with Evmos (formerly Ethermint), with which assets and projects operated in the Ethereum network can be migrated to the ATOM ecosystem.

“Evmos is a chain of cosmos agnostics. Evmos will be compatible with Ethereum, the environment is compatible with EVM and other chains via IBC, which makes it easy to move values ​​between chains. “

Up to this point there is no way for Ethereum-based projects to interact with the Cosmos ecosystem, which severely limits the number of projects and tokens that can interact with DeFi and NFT projects in the ecosystem.

Launched on December 15th, Gravity Bridge is another project dedicated to facilitating asset connectivity between Ethereum and Cosmos and currently acting as an independent chain. The move to the Cosmos Hub in early 2022 is currently underway.

Prepare to upgrade from theta

A second development that has brought the power of Cosmos to life is the Theta upgrade of the protocol, slated for March 31st.

“Theta upgrade (scheduled for March 31, 2022) would be great, it would potentially enable:

1. Trading meta
2. NFT module
3. Cross chain account
4. Use of liquidity
5. CosmWASM on Hub
6. Upgrade to Gravity Bridge “.

New features of the upgrade include adding meta-transactions, where transactions can be sent through separate accounts receiving tips, and the introduction of inter-chain accounts for users to manage accounts on multiple blockchains. Another feature is liquidity staking, a system where users use the value of assets deployed in other parts of the Cosmos ecosystem.

The Theta upgrade also includes NFT modules that allow easy management of NFT identities, their owners, and related data.

Expansion of ecosystems

The third reason that motivates ATOM is that expand of the ecosystem to 28 active, interconnected chains totaling more than $ 68 billion.

“Cosmos is the only cross-chain ecosystem in the world that uses an interoperability standard.”

The older chains that have joined the Cosmos ecosystem include Binance Smart Chain (BSC), Terra (LUNA), and Crypto.com (CRO), while the largest projects use software development kits (SDKs). ) from Cosmos includes Osmosis (OSMO.). ), Secret (SCRT), Oasis Network (ROSE) and Kava (KAVA).

If bridge protocols are established that connect Cosmos to other EVM-compatible networks, the number of chains connected to the Cosmos Hub is likely to increase, adding to the overall value of the ecosystem.

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