I know it’s hard to appreciate subtle differences when things get difficult and complicated (even more so in a 13 month market downtrend), but it’s that ability that makes the difference between a good digital asset manager and the rest. Thanks to being able to appreciate them, you not only reinforce your convictions about the asset class you are exposed to, or want to position yourself based on its fundamentals and its chart (which does not reflect the internal reality of the project itself and only reflects a one-off capital outflow from the market in this cycle), but you are also able to detect a new trend or narrative about it, which will push it above its previous ATH in the next bull market cycle. As subtle as it may be to appreciate that #Cosmos today has around 53 chains connected through IBC, a year-on-year increase of 65% compared to last year, driven by a major catalyst such as the fall of #LUNA as an alternative blockchain, which already enjoyed respect, traction and usability.
At this stage of the game, transactions, developers and holders, as well as a good token or the distribution of nodes and validators are not enough to predict a good future for any blockchain technology. The arrival of new money markets or new protocols with more sophisticated functionalities, which serve as a call effect for institutional money is very important. But without a doubt, the fact that the team works and offers solutions, before they happen and are detected by the market is for me a determining element that rewards talent and chain work, which in the future I have no doubt will be reflected in the price. In this case I am talking about #AppChains, a solution that blockchains can offer to scale consistently in web 3, the result of mixing a better experience in security, performance and personalisation.
So now a developer no longer has to focus on building a product on a network, but can build a whole experience around that product by creating an #AppChain, from which a sustainable business model for both parties can be built.
Creating a new customized and optimized L1 for each protocol and connecting them all together is already more efficient than trying to scale the same L1 to support multiple protocols and their corresponding economic activity. It is also true that the #Tendermint + #Cosmos #SDK technology combo is unrivaled in terms of the ease with which it allows anyone to set up a fully operational blockchain. From this perspective, there is no doubt that we are immersed in an unprecedented technological race, which is beginning to successfully mix usability and business, thanks to the fact that any protocol can start to build an application system around it. Without going any further, Circle announced plans to bring native USDC to Cosmos, through its chain of applications to other ecosystems such as #Avalanche, #Ethereum, #Polygon and #Sui.
In short, we are heading towards an almost present future, where we will not talk so much about the scalability of blockchains, but rather about their modularity and the quality of their #AppChains. We must follow with interest the evolution and the modular solutions that will be presented, to see which technology is capable of adapting to constantly changing environments, connected to benefit from the significant network effects and economies of scale that will be generated. We are witnessing first-hand a third wave of innovation, where a #dApp that has its own blockchain (#AppChain), will allow developers to customize their application in terms of governance structure, economic design and even its underlying consensus algorithm.
Let’s see how Ethereum responds to this leadership that seems to have its own name (COSMOS) with its specific applications (RollApps).