The Cosmos network is composed of numerous independent blockchains, also referred to as zones. These zones operate on classic Byzantine fault-tolerant (BFT) consensus protocols such as Tendermint. Certain zones function as hubs, enabling interoperability between different zones through a shared hub. This architecture applies the Bitcoin sidechains concept but with classic BFT and Proof-of-Stake algorithms instead of Proof-of-Work.

One unique aspect of Cosmos is its ability to interoperate with various other applications and cryptocurrencies, a capability not common in other blockchains. Through the creation of a new zone, any blockchain system can be integrated into the Cosmos hub, facilitating token transfer between zones without intermediaries.

The Role of Atoms in the Cosmos Network

The Cosmos Hub operates as a multi-asset distributed ledger with a native token known as Atom. Atoms serve three primary functions: spam prevention, staking tokens, and governance voting.

In terms of spam prevention, Atoms are utilized to pay transaction fees which may vary depending on the computational requirements of each transaction – similar to Ethereum’s “gas” concept. Fee distribution is managed within the protocol itself.

As staking tokens, Atoms can be collateralized or “bonded” to earn block rewards. The economic security of the Cosmos Hub correlates directly with the amount of staked Atoms – higher collateralization results in increased network security due to higher potential losses for attackers.

Finally, Atom holders have governance rights within the Cosmos Hub. They can cast votes on proposals using their staked Atoms.

To stay updated on developments in the cryptocurrency world and learn more about various digital assets like Cosmos and its native token Atom, continue exploring Global Crypto News.