- Cosmos switches gears for the fast lane to mass adoption.
- ATOM fails to overcome range amid low volatility and limited volumes prevail.
The blockchain interoperability concept made rounds during the 2021 crypto bull run, and was championed by the likes of the Cosmos network. Unfortunately, they had to pump the brakes when crypto winter came. However, Cosmos is now attempting to revive the hype once again.
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Cosmos’s latest announcement revealed its intentions to start pushing towards building and expanding an interconnected internet of blockchains again. The network disclosed that it plans to work on the implementation of IBC with solidity, a move that will make it possible for Ethereum [ETH] to be connected to Cosmos.
1/ 2023 is the year that #IBC will expand to new blockchains, including #Ethereum@datachain_en, an @interchain_io granted team, is working on IBC-Solidity.
The Solidity implementation of IBC aims to connect Ethereum to #Cosmos ⚛️ pic.twitter.com/tPVD6lnl6v
— Cosmos – Internet of Blockchains ⚛️ (@cosmos) April 6, 2023
Cosmos further noted that IBC-solidity will enable the transfer of data, tokens, and messages to multiple blockchains through IBC. This includes enterprise Ethereum and all the EVM-compatible blockchain networks.
Why Ethereum is such a big part of Cosmos’ plan
The Ethereum network can be considered as the most popular blockchain and also the most adopted blockchain network at the moment. Additionally, many networks hope to tap into its robust liquidity. This will become much easier to conduct via the IBC as soon as it gets connected to Ethereum. The overall goal is to facilitate a smoother flow of value across different blockchain networks.
Unsurprisingly, the announcement about Ethereum came just a few days after Cosmos revealed its global expansion plans. From a strategic point of view, onboarding Ethereum before executing a global expansion plan might make Cosmos and the IBC more attractive to other potential prospects.
What does the future look like for ATOM?
The demand for ATOM should go up as more blockchains get connected to the Cosmos hub. This is because the coin is necessary for projects looking to join the Cosmos ecosystem. As far as ATOM’s performance is concerned, at press time, the token was still trading at a slight premium as compared to its December 2022 lows. However, it delivered sideways action for the last 12 days or so.
Source: TradingView
ATOM’s relative strength improved over the last few days and was attempting to push above the 50% Relative Strength Index (RSI) level. This was of course backed by accumulation as indicated by the Money Flow Index (MFI). Furthermore, ATOM could also witness a bullish breakthrough if it manages to break past the RSI mid level. Failure to do so may lend favor to the bears.
How many are 1,10,100 ATOMs worth today
ATOM’s volatility was at its highest four-week peak at mid-March. Volatility has since then been declining since then. This reflected the lack of momentum as seen in the last two weeks. Similarly, weighted sentiment remained low suggesting a lack of confidence in the market.
Source: Santiment
However, there were some positive sentiments such as the growing development activity metric. This combined with the Binance funding rate’s recovery confirmed that demand was recovering in the derivatives segment.
Source: Santiment
Things may turn out favorably if Cosmos proceeds and succeeds with its plans this year. Such an outcome would certainly boost ATOM’s potential value.