Original compilation:
Original compilation:Jack(0x137)，BlockBeats
The new Cosmos white paper has just been released, here are some of my thoughts while reading it:
page 1
This page of the white paper reads: "The vision of the Cosmos Network has been realized". This is a bold but true statement. The Cosmos V1 white paper focused on building out the Cosmos Hub and communication model via IBC, which is now implemented.
page 2
Hub needs a new role. Cosmos developer Zaki said in his speech at the Cosmoverse Conference last night that today's ATOM has almost become a Meme currency in the Cosmos ecosystem, and ATOM can actually do more. Its new role is to "develop elastic cross-chain economy".
What does it mean?
The first is to become an "infrastructure service provider". Just like Ethereum acts as a platform rather than a service provider, in Cosmos chains don't need to touch The Hub to use the Cosmos SDK. Therefore, Hub also passively provides related added value...
The second is the layered architecture, including:
1. Social coordination technology, default home page and coordination layer for Cosmos SDK, Tendermint, etc.
2. Cross-chain security, Consumer Chains protected by the Hub
3. Liquidity staking, used in DeFi
4. Interchain Scheduler, a secure block space market
5. Interchain Allocator, "a platform for the client to develop and adjust the ATOM-based market."
Among them, the cross-chain coordinator and cross-chain allocator are based on specific Hubs.
page 4
The content on this page is pretty cool. The Hub will generate income from cross-chain economic activity by creating a block space market and charging matching fees. Today, the Hub basically has no income, and the cross-chain coordinator changes that. And this revenue will be used to "add promising new projects to the Cosmos Hub's assets through the cross-chain allocator."
Of course, there are many problems here. Like who decides which items to add? Are these grants or investments coming from the Center?
page 5
It is written here: "The new ATOM has replayed the role of the preferred collateral in the Cosmos network", similar to ETH, which is also the preferred collateral in Ethereum DeFi.
In addition, this page also mentions Interchain Security. The Hub will continue to minimize the security surface, so it is unlikely to be a platform for deploying applications, but to provide this security for consumer chains. Liquidity staking should be the first users of cross-chain security.
Page 6
The use of cross-chain security is mentioned here. It can be used for:
1. Rollup settlement
2. IBC routing, IBC relay contract market
3. Multiverse, my interpretation is the consumer chain
4. Chain name service, ENS on Cosmos
Page 7
Here is the first mention of cross-chain accounts. Assets pledged by liquidity can be exported through IBC, continue to accumulate rewards and be used in other agreements.
Page 8
This page mentions ATOM issuance and the new monetary policy, which will be implemented in two phases: a transition period and a stabilization period.
The transition period lasts 36 months, with a temporary increase in issuance for the first 9 months to provide initial funding for the new Cosmos Hub treasury. The circulation then starts to decrease, creating a new treasury for the Hub using Cumulative inflation. This is sure to be a hotly debated topic.
At the beginning of the transition period, 10 million ATOMs will be issued each month, which is approximately 40% annualized inflation. But it will decrease every month, and finally in the stable period, it will be 300,000 ATOMs per month, which is about 1% annualized inflation rate. When "the pledge rate is lower than a certain value", ATOM will restore the original monetary policy to ensure safety.
page 10
From the comparison chart of old and new circulation, it can be seen that the new monetary policy is better than the old one. But while the high starting point isn't an issue, it's still likely to cause debate in the community.
Page 11
Here comes the cost issue. Cross-chain security can bring more fee benefits to ATOM stakers. Chains secured by the Hub will have a global fee module and an ATOM floor fee. Fees will be charged in other Tokens, and the Hub may convert to other target Tokens, ATOMs or stablecoins before distribution. It's unclear if this is done automatically or manually, though.
Page 12
The two economic engines of Cosmos are explained in detail here: cross-chain coordinator and cross-chain allocator.
The cross-chain coordinator would "bring the MEV market on-chain, thereby minimizing trust, improving service quality, and enabling direct blockspace governance through the chain itself"
This is achieved through the following 4 steps:
1. The consumer chain provides part of the block space
2. The coordinator issues NFT representing future block reservations
3. Reserved NFT can be traded in the secondary market
4. NFT revenue is distributed between the coordinator and partner chains at the time of block execution
image description
Schematic diagram of the coordinator
Cross-chain allocators help new Cosmos projects achieve user growth, liquidity, and “long-term ecosystem alignment.”
Page 17
This page answers some of my earlier questions about allocator decision making. The Hub will "fund and incentivize DAOs to perform the tasks of the allocator", and the allocator will provide 2 tools: a covenant (Covenant) for establishing multilateral agreements and a rebalancer (Rebalancer) that automatically manages a portfolio of assets with public liquidity. ).
The functions of the Covenant are:
1. A protocol sets parameters and deposits funds into the covenant
2. Other agreements may update the parameters in the new covenant until an agreement is reached
The functions of the rebalancer are:
1. "Liquid assets third-party capital allocation strategy execution tool"
2. Periodically calculate assets to sell or acquire
These functions all seem to be useful, but I think there will be a governance dilemma in the future, because there will always be an attempt to determine the initial allocation between chains.
page 19
A concrete example of a protocol using an allocator is given here:
1. Mutual shareholding between agreements
2. Provide auction reserve price guarantee
3. AMM pool with liquid staked ATOMs
4. Rebalancing Protocol Reserves
5. Participate in the governance of other chains that own Token into the warehouse
I do see value in cross-chain allocators. Cosmos has always airdropped new chain tokens to ATOM stakers in the past few years, and the allocator seems to be formalizing this cross-chain spirit and becoming a paradigm of economic cooperation. In the words of the white paper: "The cross-chain coordinator benefits from the increased The positive feedback loop between interchain liquidity and cross-chain allocators deploying capital to increase interchain liquidity gives Hub a stronger advantage over other liquidity providers.”
page 20
Wider usage scenarios for allocators:
1. Multiple allocator DAOs to improve diversification
2. Liquidity as a service (I think this is what Osmosis is also trying to do)
3. Low-collateralized finance, "If the loan agreement defaults, they can mint the Token of the loan agreement to make up for the loss." This is wild, because lenders can use this to inflate the token of the agreement.
4. To save liquidity, "the covenant can be used to guide capital into the trading network, improve liquidity conditions and reduce bankruptcy caused by stress factors." I personally don't quite understand this.
5. An allocator outside of the Hub is still useful, as it helps projects integrate with the Hub in the future.
page 21
it's hereit's hereRead about it, very groundbreaking)
“The governance stack will provide a common specification for DAOs to self-describe their organizational structure and relationships with each other,” the white paper states.
I like this idea of a "shared vocabulary", although I find it challenging to implement in a decentralized ecosystem. Forcing a company's employees to speak the same language is one thing, but getting a community to adopt shared (non-organic) terminology is much harder.
Page 23
The concept of Cosmos Assembly (The Cosmos Assembly) is mentioned here, which is an organization representing the interests of the Hub community. It is up to ATOM holders to define the general charter, DAOs can become councils and are added to the charter providing resources and authority for specific topics, and Cosmos assemblies are made up of council representatives.
page 24
Cosmos Assemblies set priorities and budgets for the community, representing the interests of ATOM holders. I've advocated for the Hub to have a seat on the Interchain board before, but a Cosmos assembly would make more sense.
page 25
Conclusion - Continued focus on the positive flywheel effect cross-chain allocators and coordinators will create.
Finally, this isfull white paperI also recommend reading Cosmos co-founder Ethan Buchman's recentOriginal link。
