How to Buy Cosmos (ATOM)
Beginner’s Guide
What Is Cosmos (ATOM)?
Cosmos (ATOM) is a decentralized, open-source blockchain platform that allows for the interoperability of multiple independent blockchains. It aims to solve one of the biggest challenges in the blockchain industry – the lack of cross-chain compatibility.
The Cosmos network is made up of many independent, parallel blockchains called “zones,” which can communicate with each other through the Cosmos Hub. This architecture enables seamless communication and value transfer between different blockchains, which was previously not possible without using an intermediary.
The Cosmos platform is built on a Proof-of-Stake (PoS) consensus algorithm, where validators stake their ATOM tokens to secure the network and validate transactions. ATOM is the native token of the Cosmos network, and it is used to pay for transaction fees, vote on governance decisions, and participate in the network’s economic incentives.
Cosmos provides a development framework for building decentralized applications (dApps) and other blockchain-based solutions. The platform’s interoperability and scalability make it an ideal choice for DeFi, gaming, and other complex use cases that require a high degree of flexibility and customization.
Overall, Cosmos aims to create an internet of blockchains, where different blockchain ecosystems can interact and collaborate with each other, leading to a more connected, decentralized, and secure global economy.
How to Buy Cosmos Summary
- Get a Cosmos wallet (e.g. Ledger, Trezor ,Guardia, Exodus , AtomicWallet)
- Find an exchange that sells Cosmos (e.g. Binance, Coinbase, Kucoin, Bitfinex , Crypo.com)
- Deposit money and make the trade
- Withdraw the Cosmos to your wallet
Buying Cosmos (ATOM) in 3 Simple Steps
Step 1 – Get a Cosmos wallet
Cosmos (ATOM) Hardware Wallets
Cosmos (ATOM) is a cryptocurrency that can be stored in hardware wallets for better security. Here are some hardware wallets that support Cosmos (ATOM):
Ledger Nano X: Ledger Nano X is a popular hardware wallet that supports ATOM along with several other cryptocurrencies. It has a user-friendly interface and advanced security features, including PIN code protection and two-factor authentication.
Trezor Model T: Trezor Model T is another reliable hardware wallet that supports ATOM. It features a touch screen display and an easy-to-use interface. It also has advanced security features such as passphrase protection and two-factor authentication.
Ledger Nano S: Ledger Nano S is a more affordable option compared to Ledger Nano X, and it also supports ATOM. It has a compact design, easy-to-use interface, and advanced security features.
KeepKey: KeepKey is a hardware wallet that supports ATOM and other cryptocurrencies. It has a sleek design and advanced security features, such as PIN code protection and passphrase support.
When using a hardware wallet to store ATOM, it is important to follow best practices such as keeping your recovery seed phrase secure and not sharing it with anyone, verifying the authenticity of the hardware wallet before use, and keeping your device’s firmware up to date.
The best option for storing any cryptocurrency would be to use a hardware wallet. These are pieces of hardware that store the private key to your coins offline.
Today, there are two leading hardware manufacturers to choose from – Ledger and TREZOR. Both companies have different models of hardware wallets that will get the job done.
If you want deeper insights on specific models, you can read my Ledger Nano X review or my TREZOR Model T review.
Cosmos (ATOM) Software Wallets
Cosmos (ATOM) is a cryptocurrency that can be stored in software wallets for easier access and convenience. Here are some software wallets that support Cosmos (ATOM):
Cosmostation: Cosmostation is a non-custodial wallet that supports ATOM and other Cosmos-based tokens. It has a user-friendly interface and allows for easy staking and governance participation on the Cosmos network.
Trust Wallet: Trust Wallet is a popular mobile wallet that supports ATOM and several other cryptocurrencies. It offers a simple and intuitive interface, as well as advanced security features like biometric authentication and PIN code protection.
Exodus Wallet: Exodus Wallet is a desktop and mobile wallet that supports ATOM and other cryptocurrencies. It has a sleek design and a user-friendly interface, making it easy for beginners to use.
Atomic Wallet: Atomic Wallet is another desktop and mobile wallet that supports ATOM and other cryptocurrencies. It has a built-in exchange feature and supports over 500 other cryptocurrencies.
When using a software wallet to store ATOM, it is important to follow best practices such as keeping your private key secure and not sharing it with anyone, choosing a strong password, and regularly backing up your wallet data. Additionally, be cautious of phishing attempts or fake wallet apps, and only download wallets from trusted sources.
Hardware wallets cost money, so if you’re not sure how serious you are about cryptocurrencies and just want to get a taste of what they feel like, perhaps you would be better off starting with a software wallet.
A software wallet is a free program that lets you store your coins on your computer or mobile phone.
The easiest Cosmos software wallets to get started with are undoubtedly Exodus, AtomicWallet and Guarda . All wallets are very intuitive. Exodus, Atomic Wallet and Guarda is available on desktop for Windows, Mac and Linux, as well as on mobile for both iOS and Android. If you want more information you can read my Exodus, AtomicWallet and Guarda review.
Step 2 – Find an ATOM Exchange
Buy Cosmos through Binance
- Binance is a cryptocurrency exchange which is the largest exchange in the world in terms of daily trading volume of cryptocurrencies. It was founded in 2017 and is registered in the Cayman Islands. Binance was founded by Changpeng Zhao, a developer who had previously created high frequency trading software.
Buy Cosmos through Coinbase
- Coinbase is a convenient and cheap way to buy Ethereum and the platform is open to 100+ countries). Coinbase will sell you LTC for a variable fee that depends on your payment method (credit cards have a higher fee than wire transfers), order size and market volatility. Here’s how you buy Ethereum on Coinbase: Open a Coinbase account Add your payment method (Credit card or bank account) Go to “Buy/Sell” and select the amount of Ethereum you desire Click “Buy Litecoin”
Buy Cosmos through Kucoin
- Kucoin is a global cryptocurrency exchange for numerous digital assets and cryptocurrencies. Launched in September 2017, KuCoin has grown into one of the most popular crypto exchanges and already has over 8 million registered users from 700+ countries and regions. According to Alexa traffic ranking, KuCoin’s monthly unique ranking is in the top 5 globally. Known as the “People’s Exchange”, KuCoin operates in Seychelles, providing users with multi-language and 24/7 customer service. Meanwhile, KuCoin has established local communities all over the world in South Korea, Japan, Spain, Italy, Vietnam, Turkey, Russia, India, and other regions, providing users with the most local services. Currently, 1 out of every 4 crypto holders in the world is with KuCoin.
Buy Cosmos through Bitfinex
- Bitfinex is a cryptocurrency exchange owned and operated by iFinex Inc registered in the British Virgin Islands.Their customers’ money has been stolen or lost in several incidents, and they have been unable to secure normal banking relationships.Bitfinex was founded in December 2012 as a peer-to-peer Bitcoin exchange, offering digital asset trading services to users around the world. Bitfinex initially started as a P2P margin lending platform for Bitcoin and later added support for more cryptocurrencies.
Buy Cosmos through Crypto.com
- Crypto.com is a cryptocurrency exchange company based in Singapore. As of May 2022, the company reportedly had 50 million customers and 4,000 employees. The exchange issues a token, Cronos.
Step 3 – Withdraw Your Cosmos
Once you decide on an exchange, open an account and buy your Cosmos. Make sure to withdraw the Cosmos from the exchange to your personal wallet.
Never leave coins on an exchange, as you risk losing them all if that exchange gets hacked or shuts down (which has happened in the past).
OVERVIEW
Who Are the Founders of Cosmos?
The co-founders of Tendermint — the gateway to the Cosmos ecosystem — were Jae Kwon, Zarko Milosevic and Ethan Buchman. Although Kwon is still listed as principal architect, he stepped down as CEO in 2020. He maintains he is still a part of the project but is mainly focusing on other initiatives. He has now been replaced as Tendermint’s CEO by Peng Zhong, and the whole board of directors was given quite a substantial refresh. Their goals include enhancing the experience for developers, creating an enthusiastic community for Cosmos and building educational resources so greater numbers of people are aware of what this network is capable of.
How Does Cosmos Work?
Cosmos (ATOM) is a decentralized network of independent blockchains that are able to communicate and interact with each other through a common set of rules and standards. It aims to solve the problem of blockchain interoperability, which is the ability for different blockchain networks to communicate and transact with each other.
Cosmos uses a unique consensus algorithm called Tendermint, which is a Byzantine Fault Tolerant (BFT) algorithm that enables fast and secure transactions. Tendermint uses a Proof-of-Stake (PoS) mechanism, where validators must stake their ATOM tokens to participate in the consensus process and earn rewards. Transactions on the Cosmos network are processed through a system of hubs and zones, with hubs acting as the main chain and zones acting as sidechains.
Cosmos also has a native token called ATOM, which is used to pay for transaction fees and for staking on the network. Staking ATOM allows users to participate in the governance of the network, such as proposing and voting on upgrades and changes to the network.
One of the main benefits of Cosmos is its ability to enable cross-chain communication and interoperability. This means that developers can build decentralized applications (dApps) on the Cosmos network and easily connect them to other blockchain networks, such as Bitcoin or Ethereum, without needing to create their own cross-chain solution.
Overall, Cosmos aims to create a more connected and interoperable blockchain ecosystem, allowing for greater innovation and collaboration across different networks.
Tendermint
Tendermint is a Byzantine fault-tolerant (BFT) consensus algorithm that is used by a number of blockchain platforms, including the Cosmos network. It is designed to provide secure, reliable, and fast transaction processing, while also allowing for network scalability.
The Tendermint consensus algorithm works by having a set of validators, who are responsible for validating transactions and creating new blocks on the blockchain. When a new transaction is submitted to the network, the validators must come to a consensus on whether to add it to the blockchain. This is achieved through a multi-round voting process, which involves the validators broadcasting their votes to each other.
The Tendermint algorithm is designed to be highly fault-tolerant, meaning that the network can continue to operate even if some of the validators are malicious or go offline. It uses a process called slashing, where validators who act against the interests of the network are penalized by having some of their stake in the network confiscated.
The Tendermint consensus algorithm is one of the key features of the Cosmos network, and is used to secure the entire ecosystem. It is designed to be fast, efficient, and highly scalable, making it well-suited to the demands of large-scale blockchain applications.
Cosmos Hub and Zones
The Cosmos Hub is the main blockchain network of the Cosmos ecosystem, and it acts as a hub for interconnecting different zones, which are independent blockchains that can be customized to suit a variety of use cases.
The Cosmos Hub is responsible for securing the overall network, managing the Cosmos token (ATOM), and facilitating communication and transactions between different zones. It uses the Tendermint consensus algorithm to ensure that all transactions on the network are secure and reliable.
Each zone in the Cosmos network can have its own unique features, rules, and governance structures. Zones can interact with each other through the Cosmos Hub, enabling cross-chain communication and interoperability. This allows developers to build specialized applications on each zone, while still being able to connect with other zones in the network.
The Cosmos SDK provides developers with the tools to build custom zones, which can be tailored to specific use cases. These zones can be used for a variety of purposes, such as gaming, finance, and supply chain management. The SDK also includes features for implementing smart contracts, custom tokens, and other advanced blockchain functionality.
Overall, the Cosmos Hub and zones create a flexible and scalable blockchain ecosystem, allowing developers to build a wide range of decentralized applications while still maintaining security and interoperability across the network.
Tendermint Byzantine Fault Tolerance (BFT)
Tendermint is a consensus algorithm based on Byzantine Fault Tolerance (BFT) that is used to secure blockchain networks. BFT is a property of distributed systems that allows them to function correctly even if some nodes in the network fail or behave maliciously.
In a BFT system like Tendermint, a group of validators or nodes work together to reach consensus on the state of the network. These validators take turns proposing and voting on blocks, with each block being confirmed by a two-thirds majority of validators. This process ensures that the network can continue to operate even if some validators are malicious or fail to validate transactions.
The Tendermint consensus algorithm is designed to be fast, efficient, and secure. It uses a process called “rounds” to ensure that validators reach consensus quickly and efficiently, even in the face of attacks or malicious behavior.
In addition to its use in the Cosmos network, the Tendermint consensus algorithm is also used in other blockchain projects, such as Binance Chain, Kava, and the Terra network. Its robustness and security make it a popular choice for blockchain developers who want to build fast, efficient, and secure decentralized applications.
Cosmos SDK
The Cosmos SDK is a framework for building custom blockchain applications on top of the Cosmos network. It provides developers with a set of tools and libraries for building decentralized applications, as well as an easy-to-use interface for interacting with the Cosmos network.
The Cosmos SDK is designed to be modular, allowing developers to customize their blockchain application to fit their specific needs. It also includes a number of features to help developers build secure and reliable applications, such as:
Tendermint Consensus: The Cosmos SDK uses the Tendermint consensus algorithm, which is designed to be fast, efficient, and secure.
Application-specific Blockchain Logic: The SDK allows developers to create custom blockchain logic, which can be used to implement features like custom tokens, smart contracts, and more.
Staking and Governance: The Cosmos SDK includes built-in staking and governance functionality, which allows users to participate in network governance and earn rewards for validating transactions.
Interoperability: The SDK is designed to be interoperable with other blockchain networks, which makes it easy to build applications that can interact with other decentralized platforms.
The Cosmos SDK is a powerful tool for developers who want to build decentralized applications on top of the Cosmos network. Its modular architecture, security features, and interoperability make it a popular choice for building a wide range of blockchain applications.
What Makes Cosmos Unique?
Cosmos (ATOM) is unique in the cryptocurrency space for several reasons:
Interoperability: Cosmos is designed to enable interoperability between different blockchain networks, allowing them to communicate and transact with each other. This means that developers can build decentralized applications (dApps) that are not limited to a single blockchain, but can instead leverage the strengths of multiple blockchains.
Scalability: The Cosmos network uses a unique consensus algorithm called Tendermint, which is designed to be more scalable than traditional Proof-of-Work (PoW) algorithms. Tendermint is a Byzantine Fault Tolerant (BFT) algorithm that can process up to 10,000 transactions per second, making it more suitable for enterprise use cases.
Decentralization: Cosmos is a decentralized network that is governed by its community of validators and token holders. Anyone can participate in the consensus process by staking their ATOM tokens, and governance decisions are made through a decentralized voting system.
Cross-chain compatibility: Cosmos is compatible with other blockchain networks, such as Bitcoin and Ethereum, through its IBC (Inter-Blockchain Communication) protocol. This means that assets and data can be transferred between different blockchains, opening up new use cases for decentralized applications.
Developer-friendly: Cosmos is designed to be developer-friendly, with an easy-to-use SDK (Software Development Kit) and a growing ecosystem of tools and resources. This makes it easier for developers to build and deploy decentralized applications on the Cosmos network.
Overall, Cosmos is a unique and innovative project that is pushing the boundaries of what is possible in the blockchain space. Its focus on interoperability, scalability, decentralization, cross-chain compatibility, and developer-friendliness makes it a promising platform for building the decentralized applications of the future.
Cosmos Interchain Accounts Upgrade
The Interchain Foundation, a non-profit organization of the Cosmos ecosystem, announced the release of the Interchain Accounts upgrade on Feb. 17, 2022. Launched in April 2021, the Inter-Blockchain Communications (IBC) protocol is the Cosmos standard for blockchain interoperability. It allows an individual blockchain to control an account on a separate chain. There are 38 projects utilizing IBC currently, notably Terra, Crypto.org chain and Gravity bridge. The Interchain Accounts upgrade will be the largest to the ecosystem since Stargate — which enabled Cosmos blockchains to connect with each other using the standardized protocol for IBC for the first time ever. With Interchain Accounts, users can stake, vote, swap tokens and more on other blockchains. The upgrade serves the purpose of “enabling composability in IBC [which] allows innovation in distinct applications to be deployed without needing to upgrade the entire Interchain.”
Check out simple definitions for crypto terms in our glossary
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How Many Cosmos (ATOM) Coins Are There in Circulation?
ATOM has a very specific total supply — 260,906,513 to be exact. Of these, at the time of writing, about 203,121,910 were in circulation. It is worth noting that these cryptocurrencies aren’t mined — instead, they are earned through staking.
Two private sales were held in January 2017, followed by a public sale in April of that year. This raised a total of $16 million, which is the equivalent of about $0.10 per ATOM.
Breaking down the token distribution, about 80% was allocated to investors, while the remaining 20% was split between two companies: All In Bits and the Interchain Foundation.
Cosmos has compared ATOM tokens to the ASICs that are used to mine Bitcoin. As a technical paper written by the Tendermint team explained: “It is a piece of virtualized hardware (economic capital) that you need to obtain in order to participate as a keeper in the network.”
How Is the Cosmos Network Secured?
The Cosmos network is secured through a consensus algorithm called Tendermint, which is a Byzantine Fault Tolerant (BFT) algorithm. This means that the network can continue to operate even if some validators are malicious or fail to validate transactions.
In the Tendermint consensus algorithm, validators take turns proposing and voting on blocks, with each block being confirmed by a two-thirds majority of validators. This process ensures that the network is secure and resilient, even in the face of attacks or malicious behavior.
To become a validator on the Cosmos network, users must first stake their ATOM tokens as collateral. This means that they have a financial incentive to act honestly and validate transactions correctly, as they stand to lose their staked tokens if they behave maliciously.
In addition to the Tendermint consensus algorithm, the Cosmos network is also secured through a series of other mechanisms, such as:
Slashing: Validators who behave maliciously can have their staked tokens “slashed” or taken away as punishment. This helps to discourage malicious behavior and keep the network secure.
Governance: The Cosmos network is governed by its community of validators and token holders, who can vote on proposals and changes to the network. This ensures that the network remains decentralized and responsive to the needs of its users.
IBC: The Inter-Blockchain Communication (IBC) protocol allows the Cosmos network to interact with other blockchain networks, which helps to increase its security and resilience.
Overall, the Cosmos network is designed to be secure, decentralized, and resilient, with multiple layers of protection and governance to ensure that it remains a safe and reliable platform for decentralized applications.