To understand how does Cosmos work, one has to keep in mind that it does not use the usual proof-of-work consensus mechanism. According to their official website, the reason for ATOM not being a PoW crypto is that it is slow, can’t be scaled, and is quite expensive to run. To eliminate these problems, Cosmos has a Byzantine fault-tolerant (BFT) consensus mechanism and engine whose name is Tendermint BFT.
The existence of this proof-of-stake consensus has a positive effect on Cosmos value because it makes it efficient, popular, interoperable, and easy to scale. After the launch of the Cosmos SDK, it became a hit among blockchain developers trying to create application-specific blockchains. Furthermore, Cosmos developed Interblockchain Communication, or IBC, to get rid of the unavailability of interoperability in the industry.
The Cosmos whitepaper explains the function of Tendermint in detail about why it’s now called the Internet of blockchain.
ATOM, meaning the native token of the Cosmos blockchain, has two main utilities: staking and voting on Cosmos Hub. This particular Hub is the primary blockchain within the Cosmos ecosystem. In the beginning, ATOM traded within $7 in 2020, but in July, for the first time, Cosmos rose higher than 90% of its value in August 2020. Its all-time high value came in September of the next year when ATOM’s value surged almost 600% and reached $44.7.
Cosmos has been a competitor to Ethereum due to its offerings, goals, and objectives. But analysts saw the most significant movement in ATOM price during the time of migration to Cosmos in June 2022. dYdX is a well-known futures contracts exchange that announced the creation of an independent blockchain based on Cosmos. As a result, ATOM rose by 111%. Now let’s look at the present values for Cosmos (ATOM).
Before we get to know the current situation with cosmos prices, let us talk about the different factors that determine the price of cosmos. Let’s talk about the most important factor in the following:
So the first and most significant factor is the overall crypto market situation, which determines the demand for the Cosmos inter-blockchain communication protocol. If the crypto giant, Bitcoin, crashes, then there’s no way that it won’t affect the broader market. Similarly, the general market uptrend is good for cosmos prices as it rebalances the demand for a quick, scalable, secure, and affordable blockchain project.
According to various crypto price aggregators, cosmos price today is in the red zone at the time of writing. ATOM is down by 0.57%, valuing it at $10.7 for a single token. As per the standings on the top altcoins list, cosmos has reached the 19th position. From the cosmos price live, we can determine that the market is in a bearish zone where traders are either refraining from buying more cryptos or selling their ATOM.
The current cosmos price is also a significant indicator of the future of the project because it is what researchers and price analysts need for price prediction. In the past, ATOM has established itself as a solid altcoin investment. But in total value locked (TVL), Cosmos is ahead of many other similar projects. The fact that both Cosmos and Ethereum are building for the same vision shines a positive light on the former.