Cosmos Hub, the pioneering interoperable blockchain network, has introduced its Liquid Staking Module (LSM) following the successful completion of its v12 upgrade. This significant development promises to reshape the utility of ATOM, the native cryptocurrency of the Cosmos ecosystem.
Unlocking New Dimensions for ATOM
With the v12 upgrade, Cosmos Hub has paved the way for ATOM’s enhanced utility. Now, ATOM tokens can be effectively utilized to secure the network while enabling a broader ecosystem characterized by multiplied liquidity. This transformation signifies a major milestone in the evolution of ATOM’s role within the Cosmos Hub.
Cosmos Hub: Pioneering Interoperability
Cosmos Hub stands as the inaugural blockchain within the Cosmos Network, a revolutionary infrastructure that facilitates the creation of application-specific chains called ‘Zones’ within an interconnected network known as the ‘Hub.’ This groundbreaking model empowers developers to build and connect chains, fostering a vibrant ecosystem of decentralized applications.
ATOM Liquid Staking Unleashed
The proposal to enable ATOM liquid staking was initially introduced within the Cosmos Hub governance framework in April. While Cosmos Hub may not be the first to offer ATOM liquid staking, with protocols such as pStake and Stride having preceded it, this implementation reinforces the network’s commitment to innovation and user empowerment.
Prudent Liquidity Management
To ensure the stability and security of the ecosystem, ATOM liquid staking is subject to a 25% limit, encompassing third-party staked tokens. This deliberate limit has been set to mitigate the risks associated with liquidity cascades, as outlined in the initial proposal.
Dynamic Governance Control
Cosmos Hub’s Liquid Staking Module introduces a governance-controlled framework, enabling governing members to dynamically update module parameters. This innovative approach enhances adaptability and responsiveness to the evolving needs of the Cosmos community.
Enhanced Liquid Staking Providers
Furthermore, the module imposes requirements on liquid staking providers, mandating the inclusion of a specified amount of ATOM tokens in their offerings to accept tokens via delegation.
The introduction of the Liquid Staking Module within the Cosmos Hub ecosystem marks a significant leap forward in advancing the utility and flexibility of ATOM, ultimately enriching the experience for users and stakeholders alike.