Blockchain

3 reasons why the price of Cosmos (ATOM) is close to a record high

— January 6, 2022 comments off

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Blockchain network interoperability is becoming one of the main themes of the cryptocurrency ecosystem in 2022. New users continue to join the ever-evolving crypto world, and new projects and established projects are looking for the chain protocol and community that best meets their needs.

Since it focuses on facilitating communication between different networks, one project that will start to be bullish in 2022 is Cosmos (ATOM). The project calls itself the “Blockchain Internet” and aims to promote the development of an interconnected decentralized economy.

Data from Cointelegraph Markets Pro and Transaction view It shows that since reaching a low of US$25.06 on December 30, the price of ATOM has risen 75%, reaching a daily high of US$43.98 on January 4, and its 24-hour trading volume has soared to US$2.54 billion.

ATOM/USDT 1-day chart. Source: TradingView

Three reasons for the soaring price of ATOM include the introduction of cross-chain bridges, making the protocol Ethereum Virtual Machine (EVM) compatible, and the upcoming Theta upgrade, which will rapidly expand the ecosystem of connecting chains and applications.

Cosmos is close to EVM compatibility

The most important development driving the development of ATOM is the launch of Evmos, a protocol compatible with EVM that will allow assets and projects to run on Ethereum (Ethereum) The network migrates to the Cosmos ecosystem.

So far, Ethereum-based projects have not been able to interact with the Cosmos ecosystem. This greatly limits the number of projects and tokens that can interact with DeFi and NFT projects in the Cosmos ecosystem.

Gravity bridge, Launched on December 15, Is another project dedicated to promoting asset bridging between Ethereum and Cosmos. It currently operates as an independent chain. Currently planning to migrate to the Cosmos Hub in early 2022.

Preparing for Theta upgrade

The second development that makes Cosmos go smoothly is the Theta upgrade of the agreement that will take place on March 31.

Some of the new features included in the upgrade include the addition of meta-transactions, where transactions can be submitted by individual accounts that receive prompts, and the introduction of inter-chain accounts that allow users to manage accounts across multiple blockchains. Another function is liquid pledge, which is a system where users use other parts of the Cosmos ecosystem to pledge asset value.

The Theta upgrade also includes the NFT module, which makes it easy to manage NFT identifiers, their owners, and related data.

related: With the expansion of the Oasis Network ecosystem, ROSE rose by 54% in a week

The expanding ecosystem is usually bullish

The third reason for ATOM’s bullish momentum is the ecosystem’s expansion to 28 active, interconnected chains, with a total value of more than $68 billion.

Some of the more mature chains that have joined the Cosmos ecosystem include Binance Smart Chain, Terra (LUNA) and Crypto.com (CRO), while the largest projects using the Cosmos Software Development Kit (SDK) include Osmosis (OSMO), Secret (SCRT) , Oasis Network (ROSE) and Kava (KAVA).

With the establishment of bridging protocols connecting Cosmos and other EVM compatible networks, the number of chains connected to the Cosmos Hub may increase. This will increase the total value of the ecosystem.

VORTECS™ data comes from Cointelegraph Markets Pro Before the recent price increase, the outlook for ATOM began to be found to be bullish on December 29.

Cointelegraph’s unique VORTECS™ score is an algorithmic comparison of historical and current market conditions. These data points include a combination of market sentiment, trading volume, recent price changes, and Twitter activity.

VORTECS™ score (green) and ATOM price. source: Cointelegraph Markets Pro

As shown in the figure above, ATOM’s VORTECS™ score began to rise on December 28, and climbed to a high of 81 when prices began to rise 67% in the next six days.

The views and opinions expressed here only represent the views of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading action involves risk, and you should conduct your own research when making a decision.