Currently ranked slightly below the top 20 cryptocurrencies in the blockchain industry (22nd spot as of the time of writing), Cosmos (ATOM) stands out as the highest-yielding Proof-of-Stake (PoS) cryptocurrency available on CryptoStake. Despite its ranking, Cosmos possesses strong fundamentals, showing potential to address issues of sovereignty, scalability, and sustainability faced by heavyweights like Ethereum (ETH) and Polkadot (DOT), both of which are also featured on CryptoStake.
Before delving into the intricacies of ATOM staking, let's explore its emergence onto the crypto scene and the challenges it addresses in the pursuit of mass blockchain adoption. Cosmos made its debut in 2016 with the publication of its corresponding whitepaper, authored by Jae Kwon, a prominent blockchain software architect and the founder of Tendermint—the blockchain engine based on the Byzantine Fault Tolerant (BFT) consensus mechanism. Kwon's whitepaper outlined a vision for a network of blockchains that could seamlessly communicate and transact, creating an interoperable ecosystem—an ambition shared by Polkadot.
The successful ICO in 2017 was followed by the launch of the beta version of the central blockchain in the Cosmos ecosystem a.k.a. the Cosmos Hub, where ATOM staking takes place. The mainnet launch took place in 2019 - it was a resounding success that further demonstrated the viability of Kwon's vision of Cosmos's interoperability. Other blockchains that are interconnected with the Hub are called Zones - they also serve as smart contracts that communicate with each other and the central blockchain via the Inter-Blockchain Communication (IBC) protocol. Moreover, in contrast to other interoperability-focused projects such as Polkadot, Cosmos distinguishes itself by enabling interoperability with proof-of-work (PoW) blockchains like Bitcoin through special bridges, irrespective of whether they meet the specific conditions set in the Cosmos protocol.
Cosmos is a constantly expanding blockchain ecosystem featuring decentralized applications (DApps) that boast more efficient development compared to those on the Ethereum blockchain. This efficiency is achieved through the utilization of a proprietary software development kit, which streamlines complexity by providing widely-used blockchain functionalities, including staking, governance, and tokens, through accessible and familiar software development programs like GO that provide means for crafting and incorporating any desired features into smart contacts.
Cosmos plays a pivotal role in driving the mass adoption of blockchain by tackling key challenges through its emphasis on interoperability, sovereignty, and scalability, fostering a connected and efficient ecosystem for decentralized applications that can communicate beyond Proof of Stake. The significance extends to its staking incentives, where stakers of ATOM can benefit from substantial rewards, exemplified by the appealing 21.12% Annual Percentage Yield (APY) offered by platforms like CryptoStake. This not only ensures active participation in securing the network but also provides a tangible financial incentive, making Cosmos an attractive choice for those seeking both meaningful contributions to blockchain evolution and rewarding staking opportunities.
Similar to other PoS blockchains, earning ATOM staking rewards implies participation in the underlying consensus mechanism and receiving incentives in native crypto in exchange for helping to maintain the network's functionality and security. In the Cosmos ecosystem, there are two types of participants - the validators and the delegators.
The former represent nodes that perform the task of proposing new blocks, validating transactions, and participating in the consensus mechanism. Similarly to the Ethereum staking framework, the Cosmos staking validators are chosen based on the amount of ATOM tokens that are staked with them. The more tokens staked, the higher the chance a validator has of being selected to propose and validate blocks.
The latter - delegators - also lock up a certain sum in ATOM in the network. However, their task lies in picking the most trusted and reputable validator and delegating their tokens to that participant to increase his chances of being chosen to perform the duty. In return, delegators receive a share of rewards allocated to validators who do the heavy lifting. Additionally, both validators and delegators have the opportunity to participate in the governance of the Cosmos network by voting on proposals that impact the network's development and parameters.
You shouldn't confuse Cosmos's consensus mechanism with the Delegated Proof of Stake (DPoS), utilized in cryptocurrencies like Tezos (XTZ), Ark (ARK), or Tron (TRX). As previously mentioned, Cosmos employs Tendermint, a consensus mechanism that ensures agreement even when a faulty or malicious node is present. There are also major differences in the validator selection process, incentive structure, and security model.
Becoming a validator on your own accord requires a great deal of technical expertise and time commitment. To manage validator key operations properly, one has to set up a physical operation in a secure data center, install and run several pieces of hardware that must handle up to 1.4 terabytes of data. Sure, the expected income is the highest among all network participants, but so are the hassles and risks of penalties, such as slashing for being offline for too long.
For those interested in assuming the role of a delegator, one must send a "Delegate Transaction" providing details about the amount of ATOM they wish to commit and the chosen validator from the list available on Cosmos Hub explorers. It is crucial to select from the 180 validator candidates with the highest voting power, as lower-rated validators may yield significantly less rewards.
The ATOM wallet staking is actually quite simple. Download and install the Atomic Wallet. Acquire ATOM through a credit card or wallet-to-wallet swap. Open the Atomic Wallet; in the staking interface, view your balance and rewards, then click "Stake." Customize the validator by clicking on the name, considering yearly earnings, and confirm the choice. Now, your ATOM is staked, and rewards are generated with every block. However, picking a reliable validator with high earning potential could be challenging. For a streamlined validator selection, consider using a service that connects with a reliable validator offering top reward rates.
Staking ATOM can be challenging for validators due to the technical expertise and infrastructure demands involved. Even for delegators, while less difficult, the process can still be somewhat cumbersome. As a result, non-custodial staking emerges as the sole practical option for those seeking a more accessible and user-friendly approach to participate in the Cosmos network.
Whether the economy is thriving or facing challenges, establishing a stable source of passive income has always been a goal for those seeking financial freedom. The cryptocurrency industry offers investors ample opportunities to profit at a rate unattainable by other assets.
However, navigating the complexities of cryptocurrency staking and ensuring security can be a concern. In this context, the non-custodial staking solution offered by CryptoStake emerges as the safest way to 'make a coin’ via a very attractive Cosmos APY.' By opting for non-custodial staking, investors retain control of their assets, mitigating the risks associated with traditional custodial services. This approach not only provides a secure avenue for passive income but also aligns with the decentralized ethos of the cryptocurrency space, offering a trustworthy and transparent means of generating passive income.
From the perspective of ease and user-friendliness, staking Cosmos with CryptoStake is as straightforward as doing it via a native ATOM wallet. All you need is a smartphone and 100 coins in a secure wallet.
Here are the steps:
Download the app for Android or iOS from the corresponding marketplaces.
Create an account by noting down a seed phrase and setting a password.
Choose ATOM as a staking option and transfer the desired amount to CryptoStake's proprietary wallet.
Click "Stake ATOM," and you're in.
Before staking, use CryptoStake's precise calculator to estimate potential returns. If, for any reason, you change your mind about staking ATOM, you can always choose to unstake your coins within 21 days.