🌎 Cosmos Hub Proposes 1 Million ATOM Transfer to Hydro Protocol

Cosmos Hub has proposed a governance initiative seeking community approval to transfer 1 million ATOM tokens to the liquidity protocol Hydro. On July 26, Cosmos Hub announced that this proposal is now live in the community forum. If approved, the transfer will allocate 1 million ATOM from the community pool to the Hydro committee.

Specifically, 500,000 ATOM will be used to seed an ATOM liquidity pool on the interchain auction protocol. The remaining 500,000 ATOM will be staked with the liquid staking platform Stride to seed the stATOM liquidity bucket. Stride, the leading liquid staking platform in the Cosmos ecosystem, currently boasts nearly 120,000 users and holds assets close to $100 million.

What is Hydro?

Hydro is an interchain liquidity management platform that leverages the Cosmos Hub for liquidity, governance, and community growth. The protocol generates value from bidders and through yield accrued by deploying liquidity into decentralized finance (DeFi) protocols. Cosmos Hub describes Hydro as a set of smart contracts that projects can utilize to deploy protocol-owned liquidity. These deployments allow DeFi protocols to bid for liquidity, governed by the Cosmos Hub community. The value accrued from these transactions benefits all ATOM holders.

Thyborg, a Cosmos Hub contributor and Informal Systems strategist, mentioned that this proposal aims to introduce a new liquidity injection ahead of the Hydro platform launch. Hydro is currently in its testnet phase.

Deployment of ATOM Tokens

ATOM is the second-largest native token for liquidity on Osmosis and represents a significant portion of the total value locked (TVL) on Astroport, a Cosmos liquidity protocol. According to recent data, Astroport’s TVL stands at approximately $28.89 million, with a trading volume exceeding $1.3 billion year-to-date.

The ATOM token is also deployed across 15 decentralized applications (dApps) within the Cosmos ecosystem, including Canto, Injective, Archway, Dymension, and Kava.