The Cosmos community, who were staking their ATOM tokens on Tuesday approved the proposal for the launch of the next major upgrade in the Cosmos Hub.
The v9-Lambda upgrade will establish the first version of interchain security (ICS) — also known as replicated security — a service the Cosmos Hub will provide to a new generation of consumer chains in the Cosmos ecosystem.
Those consumer chains, in turn, will bring value to the Cosmos Hub, according to proponents — such as Zaki Manian, co-founder of Iqlusion.
“The right way to think about ICS is it’s in the family of staking primitives, like Eigenlayer: What Eigenlayer is to Ethereum, ICS is to Cosmos,” Manian informs Blockworks.
The network upgrade — expected to go live March 15 — was approved by over 99% of voters comprising about 58% of ATOM staked, which is seen as a vote of confidence in the network, according to Avril Dutheil, general manager of Neutron, known online as Spaydh.
“We expected it to be successful, but we didn’t expect how well received it was — it was a bit of a landslide,” In an interview with The Telegraph on Tuesday, he stated that the end of the election period was approaching.
Neutron will be likely the first platform to use the ICS.
Dutheil stated that the project has finalized incorporation today of a foundation non-profit. The foundation will submit an official proposal to Cosmos Governance in early April for the launch of its chain.
Neutron is expected to be operational in the second quarter of April if everything goes as planned.
“We’re kind of like pioneers or guinea pigs, depending on how you see it,” “He said”
With interchain security, the Cosmos Hub loans out its validator set — and the security provided by bonded ATOM — to a consumer chain, which accordingly avoids the need to bootstrap its own validators for security. As a result, Cosmos Hub gets a payment.
“In the long term, we should be aiming for projects that are going to be successful and large enough in scope that they can support themselves based on fees themselves,” Dutheil said.
Manian, who was involved in developing the ATOM 2.0 tokenomics overhaul, which community members rejected by a vote in November last year, has been thinking a lot of value accumulation for the Hub. This is being incorporated now in a piecemeal manner.
“From a fee-revenue-to-market-cap point of view, ATOM is one of the worst chains,” Manian said. “The Cosmos ecosystem is thriving, but ATOM [is not].”
While ICS may be a good step forward, “[it’s] not the most important thing happening in Cosmos this year,” “He said”
The honor belongs to Circle’s USDC and dYdX, a derivatives exchange. Circle has the USDC stablecoin that, if it is successfully adopted, could replace the lost liquidity in Terra USD in 2022.
Terra, an independent chain created using the Cosmos SDK was a blessing for Cosmos as it offered a stablecoin compatible with IBC, something that Cosmos did not have.
USDC is a powerful catalyst
Originally the USDC chain was to be launched along with ICS Noble.
The Noble team, in an effort to avoid a major setback, opted instead for a permissioned validater set up under a consensus-based system known as proof-ofauthority.
Manian Dutheil believe Noble will adopt ICS in the end. “In no one’s eyes is proof-of-authority a long term solution,” Manian said.
There are also other important milestones that need to be considered, including the move of Stride’s liquid stake platform, which is slated to become the first consumer chain.
“Let’s see ICS in production,” Manian said. “It is fantastic that Neutron is launching. It’s fantastic that Stride is going to do this migration.”
Later, he added, Noble can reconsider the adoption of ICS when dYdX has its Cosmos app chain version 4 ready.
Neutron’s general manager was clarified in an update on March 9th, 2023.
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