A little bit of chit-chat
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Cosmos Week Wrap Up
After a week full of Cosmos content (Gateway and Privacy in Cosmos), we created a wrap-up on the main takeaways and trends coming out of these conferences:
Bitcoin to Cosmos: the scarcity of liquidity is one of the main challenges for Cosmos compared to other ecosystems. As suggested by Sunny and seconded by other speakers at Gateway, there’s an untapped opportunity for Cosmos to adopt Bitcoin as its base money. In his presentation, Sunny pictured a future where Bitcoin can be “an issuance chain” and Cosmos, the ecosystem that Bitcoin is currently missing. According to Sunny, WBTC is on its way to Cosmos, and there’s work being done to bring Bitdollar, a fully BTC-backed stablecoin to the ecosystem, as well as efforts to build decentralised bridges to connect Bitcoin and Cosmos.
Privacy is a game changer: From our last IRL Privacy in Cosmos, which took place in April 2022, to this latest edition, we can attest that privacy projects have progressed considerably. For example, NYM is starting to explore ways to bring its mixnet to Web2 products such as Signal or Telegram. Meanwhile, Penumbra is scheduled to launch in Q3-Q4 2023 and will bring private trading and, as one of the hottest features, on-chain optimal routing to offer the lowest price and limit MEV.
Community Feedback: during our Privacy in Cosmos event we ran an excersice to gather community feedback regarding the future of Cosmos. We divided people into groups to debate about the main challenges including community/developer growth, user experience, scalability, and their solutions for the Cosmos Ecosystem. After discussing the main challenges, here are some of the conclusions we draw from this exercises:
Community and Developer Growth: the majority of people agreed that there’s a huge fragmentation in the way Cosmos communicates to the external world. There’s a huge need for an actor to rise up and help push Cosmos narrative further. The lack of cohesion between teams make it difficult for outsiders to perceive the ecosystem as one big community where builders can enjoy from a strong network effect. Also, Cosmos chains tend to build for “Cosmos” without opening new use cases with the potential to attract outsiders. Finally, in this sense, the community feels that there exists a need for a meme or NFT project to bring early adopters from other ecosystems.
UX: The wallet UI/UX isn’t mature enough. There should be a wallet that’s also an on-ramp and allows the user to action their wishes across the ecosystem. “Buy $ATOM”, “Buy an NFT on Stargaze”. No-one is interested in the details of IBC or swapping tokens or whatever else we want to do.
ICS: Regarding ICS, members agreed on that there needs to be a debate about whether making it permissionless or keeping it permissioned. Also, it was noticed that the naming and the benefits are not clear for outsiders. Moreover, we’re still not in a phase where product market fit is clear, and we shouldn’t push for broader adoption until the Neutron use case is completely proven. There are two main obstacles, first existing sovereign chains could have a hard time switching towards ICS because staking is their main value.
Ethereum is facing similar challenges: although there is an agreement that Ethereum is getting closer to the appchain theory that has made Cosmos unique since its inception, a thought is that Ethereum will face all the challenges Cosmos has faced to get to the point where it’s at. Dougie de Luca from Figment, pointed that the rollup movement that’s currently ongoing in the Ethereum ecosystem will create composability problems and, at the same time, will also create the fragmentation Cosmos is experiencing in terms of communication and collaboration.
MEV: once a hot topic, it seems to be fading. A very powerful quote by Sean Braithwaite from Mekatek says it all: “The MEV volume is lower than probably what has been spent by Mekatek and Skip in payroll the last year”. Sam Hart also added that in order for any MEV product to be viable Cosmos MEV needs to grow the pie. At the moment, 90% of the arbitraging happens in Osmosis, producing around 2M in total since its inception.
Stablecoins market: The stablecoin market in Cosmos seems to be in full swing. On one hand, IST is launching its vaults soon, allowing users to use a wide range of assets as collateral. Then Noble will be issuing native USDC, a key piece of the dydx launch. But there are other projects experimenting with different technologies to create stablecoins such as Membrane, designing a Euro pegged coin, Kujira, and others.
Airdrops
Wrap Up
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