A Strategic Investment plan for Cosmos

Several people have asked what I would do differently if I had a role on capital allocation in Cosmos.

It’s worth considering all options for funding such a strategic investment plan.

First and foremost, I would establish a program of bonuses and rewards for teams that can provide compelling arguments why they accomplished significant milestones on growth of IBC volume, ICS app-chain TVL or user adoption.

Second, Cosmos should always have one ambitious go to market attempt per year designed to maintain and amplify relevance. The 2023 version of this is DyDx. There needs to be one for 2024. There is a large backlog ideas from Dogecoin on Cosmos, AI model governance and more. Cosmos should always have something that has a non linear growth potential on deck.

Third, relevance. We need to rebalance unding away from maintenance of existing software artifacts and towards integrating Cosmos systems into other ecosystems. It’s sort of unreal how the Internet of Blockchains just means Comet, Comet light clients, Cosmos SDK and ICS.

We need to be funding IBC implementations in modular chain stacks.

  • Support Comet based sequencers.
  • Implementing IBC for EVM rollup, and SVM stacks and ZK stacks like Risc0 and Zk-LLVM, Starknet.

Cosmos teams that reach out and deliver working and widely adopted software into other ecosystems should be rewarded.

Ultimately Cosmos should endeavor to in integral part of the modular ecosystem where most app chain and internet of blockchains work is taking place.


Thanks @zaki_iqlusion for these insights. Is community pool in current format enough for this or do we need to think in direction of one time allocation/creation of bigger community pool or even smth else?

Commenting your points:1 and 3 is basic hygiene, while 2 is not just good to have but also kind of alpha thing that creates blue ocean. Also 2 could be main food for new cosmonauts exploring the ecosystem.

Maybe instead of lowering 20% yield we could just say fck it and put half of that in 2024 for this plan?

Having worked with many fantastic Cosmos builders, having seen Cosmos teams leading research on modularity, connecting disconnected, mastering SSF and IBC I am very much interested in the strategic initiatives on Cosmos.

Cosmos, Ethereum, Ethereum L2s can benefit from sharing (growing) liquidity, bridging assets and ideas.

Starknet - one of leading Ethereum rollups is planning to adopt Tendermint for its decentralization roadmap. Staking teams with experience from Cosmos ecosystem will be well seen in making Starknet infrastructure robust and well designed.

There are so many initiatives coming from Cosmos that we respect. There are so many inspiring builders in the ecosystems.

Connecting Cosmos, Ethereum, and Solana ecosystems might be the most exciting journey of the next few years. Bringing enterprise, research, builders spirit together. Never scrificing values, always open to influence and inspirations.

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I don’t think ATOM should have to fund this entirely on our own.

I think we have allies in the wider blockchain ecosystem where we can create alignment and coalitions.


Send it. IBC everywhere

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I think we need a venture capital that favors IBC ecosystem.
For example of Solana, Alameda Research played a role of an investor in several projects on Solana.

Thanks Zaki. Please keep these coming. Cheers

I don’t view the Cosmos Hub (ATOM) as a Google Moonshot factory. I think you basically view ATOM as a venture capital fund that keeps funding various moonshots in hope that one of them would strike it big.

The cosmos technology allows you to create your own blockchain with your own token to do that. While I don’t agree with Jae hyper-minimalistic vision of the Cosmos Hub, I don’t view the Cosmos Hub as a VC fund either. For me the Cosmos Hub is a provider of services for Cosmos SDK chains that make sense and accrue value to ATOM token holders. In other words, I view expansion of Cosmos Hub functionalities as very limited and deliberate.

At this stage, I see liquid staking as a valuable functionality to be provided (merge Stride into ATOM) and I see IBC-to-IBC spot token exchange as valuable (merge Osmosis into ATOM). Why? Staking yield is the primary financial product of Proof-of-Stake chains. Spot exchange - in other Cosmos investments I have seen needs for conversion from USDC to token and back. That conversion should be automated and cheap and for that to happen I need consolidated liquidity. Fragmented liquidity among many exchanges results in higher spreads and bad prices. Token conversion is friction and we need to minimize its cost and as such having liquidity concentrate around the Cosmos Hub stamp of approval make sense to me.

Outside of that, I don’t see any other product of value at the moment.

I am sure Zaki you have great ideas and I absolutely don’t want to stop you from pursuing them. But I think many venture ideas are failures if you look at historical VC statistics. I would be happy to be proven wrong. But not on my dime. My investment in Cosmos Hub is an infrastructure investment - ie I am investing in a highway. I know what a highway is, how to make money out of it with a toll booth. I don’t know how to make money from shooting rockets into the cosmos.

Cosmos Hub is a much bigger chain/investment at this point and you have to deal with tokenholders like me. We don’t view the Hub as a VC fund. Like liquid staking, I want to see some idea prove its value in the market place before we plunk a lot of the community pool money into it. To borrow a real world analogy, I view Cosmos Hub as an Apple. It integrates the best tech out there that makes sense for its products and clients.

I am much more comfortable with a Cosmos Hub investment strategy where it SCALES technology that has passed the proof-of-concept stage, has proven product-market fit and has alignment with the Cosmos Hub objectives as a service provider for the interchain.

In other words, I am absolutely against the Cosmos Hub becoming a Liquidity-as-a-Service provider. I think that idea should be developed in a separate chain and if it works out we will think about a buyout by the Hub later.

Staking yield is not a product, it’s a cost. It’s the price of security, it’s the cost of running the chain. It either needs to be paid for via fees or via inflation / token depreciation.

The Hub challenge is generating ROI from that inflation.

** Rather than paying for that staking yield by collecting fees from retail dApps the Hub needs to host consumer chains chosen to leverage AEZ atomic composability (Unique Value Proposition) towards an overarching catalog of complementary services. **

Totally agree with the infrastructure thoughts. Highways. Or picks & shovels works too. Liquidity as a service IMO is only good insofar as it spreads ATOM out across the Cosmos. It’s loss-leading marketing & adoption spending, not a core revenue generating business model.

Security & Trust as a Service seems like the Hub’s fated niche. For broad & creative definitions of how to provide security & trust - the strategic leveraging of ICS/AEZ chains to design unique PMFs.

The next wave of devs, b2b adopters, & retail wallet users could all see the Hub as a mark of trust & safety. Better than “Intel Inside”.

Where else are they going to feel safe?

The combined staking yield of the AEZ is the cost to achieve that stuff. I.e. Tokens spend now, moon later.

Whatever the direction ,without one & without a collective will to get there the Hub can only ever be a common pasture to mine & exploit.

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The value of Cosmos is Cosmos

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