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Will ATOM be affected with Osmosis’ move to Bitcoin? Assessing…
- Osmosis made improvements to its protocol, however, its TVL declined.
- Despite Osmosis’ decline in TVL and revenue, Cosmos Hub remained unaffected
On 2 March, Messari revealed Osmosis’ plans to integrate Bitcoin [BTC] into its network for additional security. Osmosis is a major part of the Cosmos [ATOM] ecosystem, and improvements in the Osmosis protocol could possibly be reflected in the Cosmos Hub.
.@osmosiszone is integrating #Bitcoin security! How?
+Checkpoints sent to @babylon_chain via IBC
+Single checkpoint from Babylon is then sent to Bitcoin
+Bitcoin timestamps the received checkpoint, which can then be read by participating @Cosmos zones https://t.co/58djE304gA pic.twitter.com/4o3NWlAA7z— Messari (@MessariCrypto) March 1, 2023
Read Cosmos’ [ATOM] Price Prediction 2023-2024
Increasing security
Osmosis’ security would be working through checkpoints on the network. These checkpoints would be sent to Bitcoin through the Babylon chain, which would then be time-stamped by the network. Finally, other Cosmos zones will read these timestamps.
Despite Osmosis’ attempts to improve its ecosystem through security, the TVL of the network continued to decline. Over the last week, the total value locked by the Osmosis protocol declined from $214.19 million to $190.6 million, according to DeFi Llama. The declining TVL of Osmosis impacted the revenue generated by the protocol, which ended up decreasing.
Source: Defi Llama
Cosmos remains strong, but ATOM gets affected
Even though Osmosis wasn’t able to show growth in terms of revenue collection, the Cosmos Hub protocol’s revenue remained unaffected. According to data provided by Token Terminal, the revenue generated by Cosmos Hub increased by 51.03%.
Despite the struggles of its most prominent DEX, the activity on the Cosmos Hub increased massively. This could be why Cosmos witnessed growth in revenue collection.
Source: token terminal
Even though the Cosmos Hub protocol showed growth, the same could not be said for its native cryptocurrency, ATOM. Its price fell by 4.93% over the last month. Consequently, ATOM’s volume decreased as well, as it fell from 502.11 million to 119.91 million in the last month, according to Santiment.
Realistic or not, here’s ATOM’s market cap in BTC’s terms
Another concerning indicator for ATOM was the declining development activity, which suggested that no new upgrades and updates on the network were on their way to Cosmos Hub.
Source: Santiment
A decline in development activity would make it difficult for ATOM to see growth in the near future, despite its protocol seeing success in various areas.
