How to invest in Cosmos with a Cosmos IRA

What is Cosmos?

Cosmos crypto is, according to Coinbase, “a cryptocurrency that powers an ecosystem of blockchains designed to scale and interoperate with each other.” Through the use of their unique ATOM coin, the company strives to create an internet of blockchains.

The Cosmos Network is self-described as “an ever-expanding ecosystem of interconnected apps and services, built for a decentralized future.” Through the use of its ATOM Crypto, Cosmos strives to create a broader ecosystem where individual apps can mutually benefit from being loosely connected with one another, while also maintaining their own degree of autonomy.

Generally, the Cosmos Network has a long-term goal to create value by focusing on the aspects of the digital world that will likely become more valuable: decentralization, ease of use, and efficiency. Ultimately, according to the Cosmos Network, “Cosmos apps and services connect using IBC, the Inter-Blockchain Communication protocol. This innovation enables you to freely exchange assets and data across sovereign, decentralized blockchains.”

Through the use of blockchain technology—and thanks to a commitment to continual adaptation—Cosmos strives to create a better digital future. 

The Basics of Cosmos

Currently Cosmos—which utilizes the ATOM coin—is the 20th most popular cryptocurrency in use. The market cap hovers around $5 billion and there are currently about 286.4 million ATOM coins in existence. Today, the ATOM coin is trading around $18, but as with other cryptos, it has a history of price fluctuations.

The coin’s historic value peaked in January 2022, briefly selling around $44. But while its current value might be notably lower than this peak, the coin is still generally rallying in a positive direction—at least by any sort of long-term crypto metrics. In March of 2020, at the beginning of the pandemic (and early on in the coin’s brief history), the ATOM coin was trading at less than $2. This means that anyone who invested back then would have increased their wealth by more than 1,000 percent.

So, in general, the Cosmos Network has been performing relatively well. Additionally, with a daily trading volume hovering around $500 million, it is also one of the more active coins in circulation. In addition to its relatively young history—the coin has been traded for less than four years—holders of Atom are optimistic the coin will be able to offer a lot more value in the near future. 

Key Concepts of Cosmos

The Cosmos Network relies on the use of several innovative concepts in order to distinguish itself from other cryptocurrencies. Specifically, the Cosmos Network relies on the continual development and proliferation of the interchain, which is, “essentially a new internet, comprised of an extended network of interconnected blockchains.” It is through the very existence of this network that blockchains can mutually benefit from each other’s growth.

According to Cosmos, there are four primary pillars that allow the interchain to function. Of these pillars, the most important is likely the marketplace which is “set to operate a next-gen decentralized exchange” and generally enables the exchange of digital assets. The marketplace, when compared to other digital exchanges, offers near-instant transactions while still maintaining very low fees.

Furthermore, the use of the Cosmos Network’s interchain is further facilitated by its “router” which helps further facilitate the connection between ATOM Coin and more-established networks, such as Ethereum and Bitcoin. In addition to the marketplace and router, the remaining two pillars include the custodian—which is “extremely secure” and “the best place to hold digital assets”—and the security provider, which is capable of securing multiple chains in exchange for added staking rewards.

Cosmos vs. Bitcoin

Considering all crypto investments are made on a marginal basis, many investors might be deciding whether they should buy Atom (ATOM) or buy Bitcoin (BTC).

Bitcoin, undoubtedly, has the most extensive price history (and trading volume) of any coin. The coin has generally increased in value by a lot over the past ten years, (increasing in value from about $20 to $40,000 today) but has also experienced large amounts of volatility and price instability in recent years. In general, Bitcoin has been stuck between the $30,000 and $70,000 price barriers, without exhibiting clear long-term trends. This suggests the coin might be transitioning from its growth to maturity phase, which may be less than ideal for a crypto community that is both reward-seeking and risk-tolerant.

Cosmos differs from Bitcoin in several ways: it has a smaller trading volume, shorter history, and greater two-year upward momentum. So, while it might be difficult to determine whether ATOM coin or Bitcoin can generate a higher ROI over the course of the next year, it is clear that this coin more likely fits the “go big or go home” mantra typical to crypto traders.