Cosmos Hub (ATOM)

The Cosmos network is made up of several zones, which are autonomous, parallel blockchains that are all powered by Tendermint and other traditional Byzantine fault-tolerant (BFT) consensus systems (already used by platforms like ErisDB). Some zones serve as hubs for other zones, allowing several zones to communicate via a common hub.

The architecture is a more generic implementation of the Bitcoin sidechains concept, employing standard BFT and Proof-of-Stake algorithms rather than Proof-of-Work. Cosmos can communicate with a wide range of different apps and coins, whereas other blockchains cannot. By adding a new zone, you may connect any blockchain system to the Cosmos hub and transfer tokens between them without the use of a middleman.

While the Cosmos Hub is a multi-asset distributed ledger, it does include a unique native token known as the atom. Atoms may be used for three things: spam protection, staking tokens, and voting in governance. As a spam protection tool, Atoms are utilized to pay fees. Similar to Ethereum's idea of "gas," the fee may be proportionate to the amount of processing performed by the transaction. Fee distribution is carried out in-protocol, and the protocol definition is presented here. Atoms can be "bonded" as staking tokens to get block rewards. The quantity of Atoms staked determines the financial stability of the Cosmos Hub. The cost of hacking the network increases when more Atoms are collateralized since more "skin" is at risk. Thus, the more Atoms that are joined, the higher the network's economic security. Atom holders can manage the Cosmos Hub by voting on ideas with their staked Atoms.

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