# Proposal # XXXXX Launch Aether EVM as a Consumer Chain for the Cosmos Hub

[aetherevm]

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Social Links

Website: https://aetherevm.com/
Twitter: https://twitter.com/AetherEVM_
Telegram: Telegram: Contact @AetherEVM

Summary

This proposal seeks Cosmos Community support for a FPI (Free Public Infrastructure) launched EVM to become part of the AEZ while being secured by interchain replicated security.

1. Deploy an Atom stake holder aligned EVM that requests no sunk time or capital cost from Atom community pool.
2. Align the development with the Cosmos Hub and the Cosmos Community.
3. Accept the hierarchy of needs within the Cosmos. Atom stake holders are sovereign and deserve access to EVM tooling.
4. Deploy established EVM DeFi primitives to strengthen the utility of ATOM and its liquid staking derivatives.

The document within provides details about Aether’s future and symbiosis to the Hub and advocates for Aether to launch as a consumer chain which utilizes replicated security. It also observes community feedback from EVMs which have failed to acutely capture market need, which is a byproduct result of the over reliance on venture capital and under reliance on the true spirit of crypto.

Aether Goals

1. Expand the activity of users on the Cosmos Hub via the integration of Aether EVM in the wider interchain ecosystem.
2. Create a core public utility and good for Atom stake holders, expanding the use of FOSS and free public infrastructure.
3. Incentivization of secular alignment for all Atom stake holders.
4. Continue the development of the Ethermint SDK/modules (which were funded by ATOM community pool) with an open-source license.
5. Increase the use of DeFi, CoFi, and TradFi in the Hub ecosystem.

This proposal seeks to deploy Aether on the Cosmos Hub with replicated security with redistribution of fees, MEV and other incentives.

Governance Votes

The following items summarize the voting options and their significance for this proposal:
• YES - You agree with the terms of the proposed security agreement and want Aether to be secured by the entire Cosmos Hub validator set using Replicated Security.
• NO - You do not agree with the terms of the proposed security agreement and/or do not want Aether to be secured by the Cosmos Hub validator set using Replicated Security.
• NO WITH VETO - You consider this proposal (1) to be spam, i.e., irrelevant to Cosmos Hub, (2) disproportionately infringes on minority interests, or (3) violates or encourages violation of the rules of engagement as currently set out by Cosmos Hub governance. If the number of ‘NoWithVeto’ votes is greater than a third of total votes, the proposal is rejected and the deposits are burned.
• ABSTAIN - You wish to contribute to quorum but you formally decline to vote either for or against the proposal.

Why The Cosmos

Cosmos is the most competitive product stack in the crypto currency ecosystem and there is enormous value creation ahead due to its unique network and social topology compared to other networks.
Many users have had the realization that most hype is a repackaged and white labeled Cosmos stack copycat or ideas pioneered by Cosmos long ago: bringing Cosmos tech to ETH is alpha, and everyone is using Tendermint/Cometbft or a derivative. Many of these chains had too much surface area risk due to their top-down management. The crypto ecosystem now sees the advantage to Cosmos bottom-up approach, which is similar order out of chaos regime like Bitcoin, or the Network State as defined by many cultural contributors of crypto. Whether you look at DxDy or many upcoming Cosmos chains, all of them have favorable interest in the Cosmos and the underlying strategy. Cosmos has the best grass roots and ad hoc network effect long term; especially when juxtaposed with the all the other chains out there. To keep it simple. ATOM’s lack of top-down management has created a true decentralized techno-social slack; the social topology is highly malleable and dimensional. The real utility in crypto and the number one discounted abstract asset is the interaction of social agents and formation of many interacting corpuses. The future of the Cosmos and the Hub is brighter than ever.

The Best Way to Onboard New Teams to the AEZ is via EVM Culture

Aether was built as a consumer chain for the Cosmos Hub. Utilizing ICS for security is not a pivot but the goal. Aether seeks to onboard as many EVM devs as possible to the AEZ. EVM tooling is the easiest stack to develop DeFi projects on, there is immense amount of tooling resources and already existing libraries and code bases. By giving a chance to a new team, the Hub will show that its goal is to give opportunity to new actors without an established reputation in the Cosmos. This is the only way to truly become a neutral apolitical economic zone which prioritizes growth and economic activity. Cosmos needs new teams and not only people working on Cosmos SDK chains but also people deploying smart contracts, DeFi, TradFi, and CoFi products.

ATOM as the Gas Fee of Aether

Expanding the utility of ATOM across the Cosmos Ecosystem is one of the goals of Aether. ATOM will benefit immensely by becoming the base asset for all the Aether DeFi primitives. Such as stable coins, borrowing and lending, collateral for perpetual swap products, p2p CoFi markets for discharging debt, and more. As ATOM gets adopted by chains for gas fees it will become the easiest asset UX wise to keep inside the wallet for multi chain IBC transfers.

Cosmos Needs an EVM Chain to Strengthen the Utility of ATOM

Aether seeks to generate long term revenue for the Hub. The EVM will help strengthen ATOM’s position as the numeraire/NQA “No questions asked” species of security for the interchain thus helping position ATOM to secure itself as the benchmark in the interchain when compared to other assets and products in the interchain ecosystem.

Aether Terminal as a Single Go-To Place to Interact with All Aether Apps

One of Aether’s critical path goals is to avoid fragmentation of UX. Users will be able to interact with all major DeFi protocols launched on the chain through a single dashboard. This will have multiple beneficial effects. Users that come to use one app, are more likely to become users of other apps present on the same dashboard. It will also concentrate governance in a single easily accessible place, increasing user participation in the network, allowing power users to reuse assets and their derivatives in multiple parts of the protocol in an intuitive way. Imagine pooling ATOM/USDC on Aether DEX and then lending the LP token on an Aether lending platform all from a single dashboard in few clicks.

Long Term Alignment

Aether upon launch will have a similar staking mechanism to Curve, which means users will be able to stake for longer and get a higher reward. This method was decided to reduce issuance by concentrating rewards to the longest duration staking contracts and reducing it for the lowest ones. A proper diametric yield curve is key to long term sustainable growth. The structure allows for the proper incentivization of the most fiscally responsible long term stakers which become the foundation of the network.

Long Term Staking Rates:

• 8 months lock 2.2% reward
• 16 months lock 3.3% reward
• 24 months lock 4.4% reward
• 32 months lock 5.5% reward

Unclaimed Airdrop

Airdrop clawback will be split 40% to the Atom Community Pool *vested over three years and 60% of the remaining clawback distributed to Aether Accelerator to launch TradFi, CoFi, and DeFi protocols and strengthen the development on the platform. ATOM will be backed by the unclaimed part of the airdrop thus strengthening its value proposition and assuring long term alignment between the Aether and its ICS provider. Aether hopes to collaborate with already existing entities such as the Atom Accelerator to signal that Aether’s goal is to become one of the strongest chains in the AEZ. The modus operandi of Aether is to create as much industry symbiosis and collaboration as possible with existing players.

Funding Validators

One of the main complaints with ICS is that validators need to stomach the full cost of every new ICS chain they run. With Aether’s governance mechanism, delegators will be able to delegate to validators sharing part of the inflation rewards with them (similarly to how it works already on standard Cosmos Chains) with a key difference that these new entities called delegates will not be able to vote. We find this is the best way to focus validator contributions on services and contribution to the protocol or launching protocols on top of Aether, we hope delegates funding becomes a successful way to fund new market collaborations and projects.

Soft opt-out

Cosmos Hub validators will have to use additional resources for Aether chain, validators in the bottom 5% of voting power (roughly 65 validators) on the Hub would not be forced to run the chain but they would have the optionality to opt-out from validating for the Aether chain.

Revenue share

• MEV revenue: 33%
• Transaction fees: 100%

Aether looks to deeply incentivize the Cosmos Hub with this proposed revenue share agreement, to date this would be the highest distribution any live ICS chain has proposed for transactions fees and MEV, we are sure an EVM chain would bring enormous amount of revenue to the hub long term, and cannot wait to see the AEZ grow and become economically sustainable.

ATOM as the benchmark asset

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ATOM is already DeFi and TradFi because Atom is also the market security provider like Bitcoin, ETH or a nation states military projection. Atom is the benchmark asset utilized to discharge debt in the interchain. The benchmark asset and security provider which allows the formation of a digital network states simply needs more avenues and locals for users to express its value. Aether is built to host an ecosystem of CoFi, TradFi and DeFi primitives around Atom and Aether. Thus, generating an ecosystem of Free Public Infrastructure and proper capital formation for stake holders without the heavy load of venture capital and opaque presale deals, whose cheaply priced supply exposes all secular stake holders to excessive downside. Applications and primitives built on Aether will enable Atom stake holders to use native and liquid staked ATOM to borrow, lend, express governance power, provide liquidity, and much more. These products will drive demand for the benchmark asset ATOM and help user driven consumption of ATOMs via the need for users to discharge interchain ecosystem debt and properly hedge user specific capital formations. The more robust builds and the more products that teams can choose from, the easier it is to sustain long term road maps and engage in active treasury management strategies.

Aether A Fresh Start

ATOM is the benchmark asset that players use to discharge debt; it has thus won the battle for strongest asset across the interchain. There are pros and cons to becoming the benchmark asset of an ecosystem. One of the cons is that developer teams must seek allocation of this benchmark asset to secure dollar liquidity and thus hedge future development cost and risk: as the dollar is the global benchmark asset. The more teams that request ATOM for developer funding, the more future sell pressure exists for Atom stake holders. The project which received Atom to fund their expenses now must produce much more value to become a net positive endeavor for not just ATOM stake holders, but the native token they issue. We can call this AROAI or ATOM Returned On ATOM Invested. How much of the benchmark asset value is returned to ATOM stake holders nominal and real? Nominal values, just as in TradFi do not mean much in terms of real value after a long time series cycle. Too often, nominal values of AROAI are passed around as teams want to prove their worth to ATOM stake holders. The success story of ETH has nothing to do with bloated venture capital Erc20 ICO’s. It was the era and philosophy of FPI and values inherent in FOSS and cyberpunk culture which brought the most value to ETH stake holders. Projects built by ETH OGs, with little use of “other people’s money” such as venture capital, family offices, community pools, and grants. Limiting the initial use of external funding creates proper capital formation for stakeholders as well as adhering to the cultural pillars of crypto.

Chain Symbiosis

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Consumer networks with appchains create additional hardware costs and devops costs for validators, as each validator must run a unique node for each additional consumer chain. This increases the CAPEX and OPEX for validator teams on the Hub, and thus increasing the liability side of the balance sheet, leading to more sell pressure. This is an obvious issue which is counter to the scale of economies. Smart contract systems are not an additional cost matrix for users and thus reduce increased risk exposure due to decreased cost. Permissionless access to smart contract utility as Free Public Infrastructure lets any creatives in the Interchain Ecosystem launch without creating additional bloat for the Cosmos Hub and her Stake Holders. Aether replicated security allows hundreds of projects to utilize the power of Solidity, without negative feedback loops imposed on the Cosmos Hub and participating validators, instead of having a separate chain for each project, now new teams can deploy on Aether’s EVM.

FOSS

The Ethermint module was funded with ATOMs via the Cosmos Hub community pool, the codebase thus launched with an open-source license. Recently the license was changed. Because the Ethermint module was funded with ATOM community funds we think the license should remain open source and development of the open-source codebase should continue.
Aether will utilize the latest open-source version of it, and further iterate on the core codebase. The vision is to improve and maintain the chain thus keeping it as freely available public good. We think it is necessary for the Cosmos ecosystem to succeed.
We believe the future of any chain declaring itself as a general smart contract platform can exist only through open-source licensing. The adherence to FOSS is not just about security, but also dissolves legal moat, thus making it easy for developers to interact with the software without worrying about counter party claims. Anything opposite of this, is a Trojan horse vector to implement wide regulatory capture on chain. The anti-thesis of why we are all here.

Developer Language Preference - Solidity and CosmWasm Synergy

EVM chains have become the go to solution for most DeFi projects. The Cosmos ecosystem will benefit with up to date EVM development, which is necessary to gain market share over other EVM focused ecosystems. The focus on only CosmWasm is a missed opportunity. While it is understood that CosmWasm was built with IBC in mind, it has thus failed to gain any significant developer adoption and failed to attract an Ethereum userbase. This is not the fault of CosmWasm, but simply the nature of developer demographics and languages in practice. The majority of the DeFi, projects are being developed on EVM chains. There is no reason to isolate the Cosmos Hub from such a vast ecosystem. There are only opportunities to gain by adopting a Native Hub EVM. CosmWasm development is far more complicated then EVM development and only a fraction of developers exists which have the capability of developing with a Rust/web assembly framework. Creating a significant CosmWasm developer pool will take a large amount of man hours and training time and it is not reasonable to assume it will happen in the short term. This is a multi-year endeavor. Launching an EVM on the Hub can boost CosmWasm adoption as new developers will come for the EVM and discover higher use cases with CosmWasm if their skills set is applicable.

Aether Will Have Primitives Upon Launch

Upon launch Aether will have a basic set of primitives, thus showing technical standard and decorum of commitment. The goal of these basic primitives is to demonstrate quick deployment of DeFi projects, the success of aether however doesn’t rely on any single primitive but on the adoption of the Aether EVM. Aether’s focus remains on sustaining an open source EVM that can act as Free Public Infrastructure for the AEZ and Interchain Ecosystem and to absorb any idle LSD supply.

High Value Use Cases are Limited by Security

Other EVM Cosmos Blockchains have failed to attract high value EVM Dapps. Part of the problem is the lack of security (and the highly inflationary tokenomics). ATOM with its enormous security budget will help Aether attract more attention and utility to the new Hub EVM. Aether will become the most secure EVM on Cosmos and the default option for deployment for all third-party solidity contracts.

The Need of Liquidity Sinks in ATOM

Recently the liquid staking derivative module was launched on the Hub, unlocking a huge part of the supply. Liquidity is a double edged sword. What is not bonded or used capital is now floating. The pros of LSD is that it allows the velocity of money and credit to inspire a wave of DeFi, TradFi, and CoFi among the Interchain, including on Aether. This newly unlocked liquidity must find a home quickly or it may impact market liquidity negatively reducing upside potential because of lack of use cases, and current high rate macro market. Launching an EVM consumer chain concurrent to LSD becoming a standard is the best way to absorb the discharge of debt and turn all this liquidity into positive momentum for ATOM. In the absence of new use cases, liquidity sinks and DeFi protocols which allow the proper ability to hedge and discharge debt, the opposite can happen. An EVM chain is the optimal way to quickly put all LSDs to productive use. Launching an EVM consumer chain should be the immediate pressing concern of every ATOM stakeholder. The AEZ will not be able to grow without one. Network States will suffer the same issues as they mature without robust market mechanics to absorb risk from counter parties.

Increasing the Use of Liquid Staking Derivatives

Aether’s goal is to launch all major DeFi primitives in the next 8-12 months and absorb the majority of LSD supply which in the present are without a home. Aether seeks to offer risk off opportunities and higher yield/ higher risk products and strategies. The first step into becoming a mature DeFi market is establishing a stATOM backed stablecoin. The most interesting opportunity lies in something like a multi collateral liquity v2 fork. In the meantime, Aether’s focus will evaluate solutions like CANTO/NOTE with a focus on ATOM LSD markets. It is time for LSDs to be used and for ATOM stakers to earn yield out of new DeFi primitives via Aether. ATOM DeFi is immature and/or fragmented across many chains. By launching all major DeFi primitives on Aether’s chain, composability is increased for ATOM. Users will be able to pool tokens and lend the LP tokens or use them to create stablecoins all in a single interface. We believe in the network state thesis, polished products and easy UX, and see these markets no different than trade finance guilds which existed prior to the monopoly of central banking. Ethereum has a variety of DEX models, some are focused on bootstrapping liquidity like solidly ve(3,3) model or Curve tokenomics which secures risk via layered topology of different bonded durations. There has been no proper flywheel mechanism tried in the Cosmos, but it is time to correct that. If you believe liquid staking derivatives must be put to use and fast then Aether is your greatest ally.

Learning From The Past

Multiple EVMs have launched in the Cosmos. The most successful product being CANTO. CANTO has decided to pivot to a roll up model on Matic, thus ending the isolation of the digital money market and offering such primitives to a wider ecosystem. Their transition to Matic shows their lack of commitment to the Cosmos, thus creating a favorable opportunity for Atom Stake holders. The observation of other products like Kava, Bera, and Evmos have also taught many lessons to Atom Stake holders. Network States with emerging money markets are not always going to have a perfect launch, nor short term stability; like any new revolutions which seek to organize human incentives correctly (such as states, municipalities, DAOs, etc) there are many that fail and many that grow. Short term volatility is huge, but long term there is stabilization of organizational corpus. Network State crafting is far from over, and the future is bright. These emerging Digital Network State money markets go through periods of robust springtime blooms and then welt into crypto winters. These cycles of market reflexivity have thus made it easy to identify key points that we look to do right with the launch of Aether.

Key Takeaways

1. The EVM chain needs to launch with core primitives, rather than wait for third parties to build them; otherwise, the EVM misses the entire point of its M.O. which is the ability to lift free public infrastructure. Products only have to offer better property rights, access to protection of purchasing power, etc than most local markets can offer their citizens. Someone in a capital control market can protect themselves better from purchasing power debasement risk with relative ease now.

2. The token needs to have utility from day zero, creating a positive flywheel is critical path.

3. High inflation and soft money policy destroys any positive momentum via dilution of key stake holders. Many Cosmos chains had the misfortune of launching during a bear market or right on the cusp of it, with extremely high chain inflation to incentivize users.
   Others opted for lower inflation and has overall more protocol growth and adoption from users. Aether tokenomics seek to align stake holders with more predictable and lower issuance policy.

4. Concentrating on improving tech and the base layer protocol (only infrastructure lift) before having use-cases and a growing ecosystem of is a quick recipe for failure.

5. You can only launch once, it is better to get things right the first time. Rework and pivoting after failure rarely leads to recovery and adoption. Genesis is everything.

6. Aether’s goal is to bring EVM capabilities and core DeFi primitives to Cosmos. The main user-base that is being targeted in the beginning is ATOM owners. The chain will focus on the Cosmos side UX, making it as easy as possible for Cosmos ecosystem users to interact with it. Keplr’s smooth UX flow will be one of our biggest priorities. For this reason we decided to use the default Cosmos fee system (and keep up to date in the fee tech stack improvements being discussed in the last weeks) instead of the default ethermint fee system. Coin type 118 will be used instead of the default eth coin-type allowing us to make IBC UX depositing and withdrawing seamless like Osmosis without any manual interaction or address copy-pasting.

7. Airdrop recipients tend to quickly sell their tokens not giving the project time to grow. Aether airdrop mechanism will enforce a lock time in accordance with capital formation strategy formed over hundreds of years. This will help ensure the project has enough time to prove its worth to ATOM stakers and the AEZ as a whole.

8. ATOM Prop #44 gave Evmos an ATOM subsidy from the community pool. Aether looks to airdrop to ATOM holders without being the beneficiary of 100,000 ATOMs to bootstrap the project.
   Aether also did not raise in funding, not receiving VC money will keep Aether nimble and focus the team on creating as many value capture mechanisms for Aether and the Cosmos Hub.

   • Proposal Details | Cosmos Hub Block Explorer
   • https://atomscan.com/votes/44

9. Token reputation is impossible to regain once lost. The market desires risk managers, not risk takers on the long tail.

10. Open-source drives value creation, closed source is a terrible long-term strategy, as open source always receives more adoption long term, and it is more secure as more people have an incentive to contribute. The public owns the codebase. That is why Linux won for enterprise adoption and is one of the most widely used OS today in which nation states, transnational firms and such entities are reliant on. FOSS also creates a contribution culture based on metaphysical idealism, an important pillar to have in the temple when times of dearth exist.

11. Culture is key to a flourishing crypto project and NFTs are key to culture, but the culture cannot exist in the long term without economic sovereignty as the key modus operandi of the Network States culture, a prime abstract value most EVM projects missed.

12. Launching a new token for Aether (and sending unclaimed tokens to ATOM community pool) will assure maximum alignment as there will be overlap between Aether airdrop recipients and ATOM stakers. No other solution will create as much value for ATOM stakers and validators.

13. Usecases, DeFi primitives, an optimal flywheel mechanism and good tokenomics are necessary and not optional.
    EVMs are not valuable without use-cases, and use-cases are not abstract, or opaque. The story of crypto is simple even if venture capital re-framing attempted to steal the story. The story for real players in the arena is the ability to transition culture into a more open money market system with permissionless bearer use cases, allodial private property, and self-custodian responsibility and security as a market good to enshrine the above. These are the most valuable abstract goods produced in human history.

The Hub Needs to Create Momentum Now

The cosmos ecosystem and more importantly ATOM has always been perceived as largely disconnected from the rest of crypto, thus it didn’t participate in the previous cycle DEFI wave, we think the largest contributor to this is the lack of an EVM tied to the hub and a lack of focus on EVM narratives from ATOM stakeholders.
As of now there is not many ways to utilize ATOMs beyond simple staking or LPing, Aether goal is to adapt all the most popular ETH products to ATOM, creating the hedging and yield market ATOM always deserved but never got.

We think that launching an EVM consumer chain is the most productive use of interchain security and will quickly become the most profitable chain in the AEZ.

An EVM consumer chain will eventually have to happen on the Cosmos Hub if adoption is the goal. The faster it happens the more likely ATOM increases product market fit within the Cosmos Ecosystem. An EVM on the Hub should be tailored for it and not a pivot. Delaying such launch by months is not something the ATOM community should consider. We think the time to deploy the EVM consumer chain was yesterday, and we are surprised it was not deployed already. For this reason, development started right after ICS was launched.

Code is complete, testnet is ready to deploy as soon as needed, binaries will be released shortly.

Aether will need help for the testnet launch. If you are a validator or a Cosmos community member interested in supporting us in the early days please join our communities.

Roadmap (in no particular order)

• UX and gas fee payment improvements, effortless userflow
• DEX: Aether’s dex will focus on creating the ideal conditions for ATOM focused trading pairs
• Lending with focus on ATOM and ATOM LSD
• Liquid ATOM backed stable coin
• Perpetual platform/Futures contracts and products with ATOM collateral
• NFT platform with ATOM pricing
• In general, the most popular EVM primitives will be ported
• Integration with p2p DeFi/CoFi lending markets, automated yield producing vaults
• EVM specific MEV extraction tools (and integration with existing ones)
• After all core primitives are established Aether will focus on creating new DeFi primitives which leverage the unique capabilities of the cosmos SDK and ABCI++

Initial Token Allocation

122,222,222 tokens

Community Share: 71.50%:

• 40% airdrop
• 20% LP rewards
• 10% community pool
• 1.50% validator incentives

Team Share 28.50%:

• 15% long term development (locked for 32 months)
• 5% mid term development boost (locked for 24 months)
• 7% founders (locked for 32 months)
• 1.50% liquid tokens for early expenses

To make sure alignment with the Cosmos Hub stakes remains long term, all airdrop tokens will be auto staked upon claim in one of the four long term staking options. Higher tiers will get bonus tokens and during the first 8 months only staking rewards (and lp rewards) will be liquid, no airdropped tokens or team tokens(team tokens will be locked in the long term staking options same as airdrop tokens, staking rewards will be liquid and used for development).
This will ensure Aether becomes a long-term project and will show the multi-year commitment, with both the AEZ and the Cosmos Stakers.

Estimated Launch Time

• Private Aether test net is currently running
• Proposal is posted on the forum
• Multiple weeks of time for community feedback.
• During this community feedback time binaries will be published and a public test net for Aether is launched (either a new test net or using already running Cosmos Hub test net depending on community feedback).
• A signaling proposal is launched on the Cosmos Hub.
• After the signaling proposal (hopefully) passes all the code will be published on Github with open source licensing.
• After the public test net is deemed stable a deployment proposal on the Hub will be posted.
• Approximate “ready to launch” timeline 2 months since the forum proposal is posted.

[lexa]

Code is complete, testnet is ready to deploy as soon as needed, binaries will be released shortly.

Aether will need help for the testnet launch. If you are a validator or a Cosmos community member interested in supporting us in the early days please join our communities.

let’s talk! I’m from Hypha Co-op and my team coordinates the Cosmos Hub Replicated Security testnet, where all our consumer chains have gone through testing and launch rehearsals with validators from the Hub’s active set. My TG handle is @lexamichaelides.

[tknox35]

Took a quick look for now, but like the initial sound of it. Interesting. Is this using Polaris or the Evmos codebase?

Edit: Nevermind. I see “Continue the development of the Ethermint SDK/modules (which were funded by ATOM community pool) with an open-source license.”

[Govmos]

Looking forward to have @lexa & Hypha’s feedback on the actual code after review.
We will give this project a thorough analysis and a complete due diligence after you made the first early green light checks.

[obryta]

If atom is gonna be used as Gas .

What will be the usecase of Aether ?

How about a dual token system where atom is used as gas

But aether holders earn atom through fees on the networks

Sort of real yield that ll increase atom usage and also benefit aether users

Something similar to $Maya and $Cacao

[Noam]

There are a lot of EVM-based L1s in the market right now. I think the biggest failing of many of them is a lacking go-to-market strategy and an inability to attract significant high-impact projects and developers. There are only a handful of devs in Web3 right now and every L1 is competing for the same market share.

Without some strategy on how to increase that market size and get tons of non-crypto native devs to build Web3 products I can’t imagine any new EVM L1 succeeding. I don’t see any up and coming project like Aether doing that better than Base, Optimism or Polygon, given their experience, network, and the size of their war chests. Additionally, a lot needs to change in the underlying tech in terms of UX before enterprises and developers outside of Web3 are going to be drawn in.

Don’t get me wrong, I think having a successful EVM-based L1 in the AEZ can be incredibly good for ATOM. But from the way this proposal reads I have no reason to believe Aether can solve any of the above mentioned concerns better than the competition can. I would encourage the team to address these critical obstacles to success before going on-chain.

[tom]

in my opinion (sorry no offense) it would be 100x better for AEZ to have Union or Polymer

[mohammedtaherpatla]

Happy to support for node operations DM me @mohammedpatla on twitter/discord/telegram.

Like the ATOM Gas usage across the CosmosSDK stack.

[Tricky]

Just wanted to thank the Aether team for this thoughtful post. It is obvious you have been paying attention to current ICS structures, and even the concerns some have had. The fact you already seem to have a pulse on the ecosystem and probably some awesome advisors helping you navigate this is comforting.

A few thoughts & questions from your proposal that I have:

1. What EVM framework will you be using: Ethermint, Polaris, or something else?
   Polaris has fixed some issues and inefficiencies experienced with Ethermint and will be open sourced by the Bera Chain team. It is also an OS library that will have continued development into the future which there is not necessarily the case with Ethermint.

2. The Aether token - With ATOM having utility as the gas token and seemingly a base currency, what all will be the purpose of the Aether native token? How will it maintain its value and create demand? Have you done research on dual & multi-token systems?

3. Team Vested Tokens - Will there be any sort of cliff and vesting period, or just a straight unlock at said times? Will the team be staking the entirety of their vested tokens? We’ve seen in the Cosmos that stakeable vesting tokens don’t align long term incentives because of the massive gain from inflation in the beginning stages with those large amounts. What will be considered as expenses from the team locked tokens inflation? A “Salary” expense could be used as a loophole to spend even more than the 1.5% of liquid tokens. If those tokens are meant for expenses already, why the need to double up and use the super high inflation from the team vesting to pay the team even more? I feel this needs more clarity and a proper balance to not game inflation and vested accounts. Or just remove the 1.5% liquid for expenses and use inflation for expenses. Much more prudent this way.

4. Auto Staked Tokens - How will this be decided? Will everyone be set to the minimum with the option to increase without having to unbond?

5. Validator Incentives - Will this be for testnet participants, current Hub validators, or be the source of inflation? Would love some more clarity around this.

6. What is your ask from the Hub? - This is probably the most important. in your proposal, you seem to have planned this out very well and are ready to pull the trigger. Aside from testnet support, what do you need from the Cosmos community and the Hub specifically to make this launch successful? Will there be a financial ask from the hub? You seem to have liquid genesis tokens dedicated to expenses, will there be any safeguards? Do you have a full team to support its development from launch through at least your initial roadmap?

7. Hub Revenue share - What did you have in mind for the economics of the Provider<>Consumer relationship? Up until now, they have been underwhelming and without any guarantees to either party. Will you set an example with a more sustainable model, or will it be loosely formed like the other current consumer chains? With the risk of adding a general EVM L1 on top the growing consumer chain list, the reward must be worth it for the Hub.

8. Official Cross-Chain deployments - Do you foresee a world where Aether seeks to be the official Cosmos deployment for Ethereum Blue Chips like Uniswap, Aave, Compound and others, or will you look to build all of these things yourself into the native chain logic?

9. Beyond DeFi Primitives - What are the plans beyond the simple primitives and achieving a level similar to Canto? Is that where this ride will stop too, or are there plans to grow beyond that? If this EVM is too general and not use case specific enough, I fear it will fall into the trap of just being another general L1 EVM which I don’t think this would create the proper competition and provide the proper return to the ecosystem with a few other general L1s that have shown the generalized EVM game is almost impossible to be meaningfully successful with at the current time considering the competition. I completely agree with the points made by @Noam and we need to take this into heavy consideration.

Looking forward to the responses and continuing this discussion so the team can put forward the most informed proposal possible!

[aetherevm]

Thanks @lexa for your support. We’d like to reach out to you to begin the review process for a successful deployment and look forward to making updates here for the community. Please contact our telegram handle @Aetherevmcosmos so we can collaborate, we seem to be unable to message you directly.

Edit: Looks like part of our post was left out, the original post has been updated to include the missing sections

[tanned]

Hello, I think having a evm in aez make sense.
I maybe skip something but can you be more precise of aether token?

[aetherevm]

Aether is aligned with the desires of ATOM stakeholders who have shown a clear interest in EVM tooling. As stakeholders ourselves, our focus extends beyond the competition among chains and tokens. We recognize that ATOM’s intrinsic value is already well established, as reflected by its market capitalization. To us, EVM is a tool akin to the hammer and nails of the industrial era—it’s about leveraging the right tools to enhance utility, not simply engaging in technological rivalry.

Within the Cosmos ecosystem, a gap exists between the abundance of infrastructure engineers and the scarcity of app engineers. It’s this gap that Aether aims to bridge. Apps foster product development, which in turn facilitates better market formation. Our mission is to integrate existing and proven primitives for ATOM stakeholders, fostering a robust DeFi market within Cosmos. This initiative is not about starting from scratch with a blank-slate EVM; it’s a concerted effort to enhance ATOM’s utility and market dynamics.

Currently, the Cosmos ecosystem lacks a competing EVM chain. Yet, there’s an untapped potential in $3 billion of liquidity and an emerging market of staking derivatives waiting to be harnessed. If Aether can mobilize even 10% of the ATOM supply within Aether DeFi, the impact would be substantial, unlocking significant value for ATOM. Idle liquidity leads to poor capital formation and inflates the token’s float unnecessarily.

Aether’s objective is to introduce core EVM DeFi primitives to Cosmos, reinforcing ATOM’s position as the benchmark asset of the interchain. Having observed the pitfalls that hindered adoption in other EVM-compatible chains, Aether is poised to address these challenges head-on. Aether’s goal is not to contest ETH L2— such competition is unnecessary. With ATOM among the top 50 by market cap, valued at $2.8 billion, there is an abundance of native capital eager to diversify its expression. Aether is here to augment ATOM’s functionality and create numerous liquidity sinks for staking derivatives. Waiting for a perfect technical solution risks diminishing ATOM’s prominence in its own ecosystem. Our focus is on proactive development to maintain and elevate ATOM’s primary standing within Cosmos.

All of these points will be touched on again in future blog posts as they are definitely worth addressing in depth.

[aetherevm]

1.Aether will utilize Ethermint as its foundation, as Polaris is currently not production-ready and lacks open-source licensing. The open-source ethos is a core value within the ecosystem, aligning with the cypherpunk ethic that has been a driving force in the crypto world.

2.Aether’s utility will be elaborated on in upcoming blog posts, but in summary, it will benefit from revenues generated by the DeFi primitives launched on the chain. Additionally, Aether will be utilized for airdrop snapshots for primitives requiring separate tokens.

3.Staked tokens will remain locked for the duration specified in our forum post. Staking rewards will be liquid, but the inflation rate will be lower compared to other Cosmos chains.

4.You will be able to select one of the four staking options when you claim your airdrop, the default will be the minimum tier.

5.The mentioned incentives are for the testnet, and Aether welcomes support and guidance from experienced validators as the project progresses.

6.Aether seeks to bolster ATOM’s strength and position within the Cosmos ecosystem. While it doesn’t request anything from the Hub, it does seek encouragement and support from ATOM stakeholders and validators on its testnet. Development is self-funded, and resources are available to sustain further development after the launch, with no plans to seek future funding from the Hub.

7.The main post has been updated, including sections that were initially omitted during editing. Notably, Aether Protocol will offer the highest revenue share of any live chain and plans to incentivize the Hub by sharing part of the unclaimed airdrop supply. Core primitives launched on Aether will also share revenue and be community-driven projects.

8.Aether is open to collaboration with Ethereum core projects but does not anticipate them automatically joining due to the launch of an EVM chain, given the unique culture and dynamics of the Ethereum community. The modus operandi is to independently launch core primitives without waiting for others to do so.

9.Aether’s primary goal is to address present issues, such as the lack of utility for the ATOM token and the absence of core primitives around it. Currently, there is no DEX prioritizing ATOM pairs. Aether recognizes that tooling can help networks address capital structure challenges, reinforcing their role as providers of trust, credit, and property rights. Aether’s perspective is not bearish and acknowledges the significant achievements in the crypto space, including the settlement of trillions in stablecoins and the growth of global property rights, driven by continued secular growth.

Aether acknowledges the exceptional achievements of projects like Canto and their role in providing a better money market than many nation-states. It emphasizes the importance of contextual evaluation in assessing success within the crypto industry.

[Tricky]

1. Polaris is very close if not ready. It will be open sourced after the launch of Bera Chain, the initial Polaris project built by the Polaris contributors. You will be making a very very very big mistake by choosing Ethermint of Polaris. I used to be a core contributor to Evmos, so I say this with some insight. Just a quick watch if you havent seen this presentation, I have it starting on the Polaris section.

2. If Aether isn’t even the gas token and is essentially just a farming token, this creates a different conversation for the Hub. They will be diluted in perpetuity unless mechanisms to stake are implemented. With no real value or reason to keep Aether, it will be hard to maintain value and demand. Airdrop dumpers will compound this issue as well if thats a main usecase.

3. So none of the locked team tokens will be available until the entirety of the locking period is done? No cliff or linear vesting?

4. Cool

5. That will definitely help the validators who are running and supporting your network. There are plenty who will be more than happy to contribute, including us at Cosmos Spaces! I recommend a clear token release plan that takes into account the total amount of validators. Also, try to select validators who will contribute through mainnet and not just hunting for an airdrop. Makes the most sense to onboard Hub validators as first priority. A short vesting period is not a bad idea as well.

6. Refreshing to see a team with true entrepreneurial spirit. Since there’s not as much of an ask from the Hub, the path should be easier than asking for the hub to be an investor and a security provider without proper incentivization. Considering the initial primitives, great opportunity for POL as well. I’m assuming there will be those asks. I’m sure you will have some good synergies with Timewave & @hxrts

7. Thanks for those updates. An interesting dynamic allowing “delegates” to receive a portion of the native staking. Will there also be regular inflation going to validators for the staked ATOM and provided security, or is this the only mechanism to partake in staking inflation? This is cool idea, but wondering if there’s another way to make sure those rewards don’t end up with the same issue it’s trying to solve. I love the Hub getting the unclaimed airdrop, but it is an inflationary token so the hub is diluted unless it stakes as well. Which is should and should also vote where it makes sense.

8. I wouldn’t suggest waiting, just pointing out that the governance process for official deployments favors Cosmos with it having its over community governance mechanisms, and a hypothetical EVM chain secured by the Hub itself is more attractive than say Evmos or Kava.

9. It is interesting you want to build up more ATOM pairs, because it seems some protocols want to focus more on USDC pairs going into the future. I’m not sure just adding more DeFi protocols is really adding more utility for the ATOM token. The Hub in partnership with its consumer chains needs to do that, but the goal should be more than just being used in DeFi primitives.

@aetherevm

Currently, the Cosmos ecosystem lacks a competing EVM chain. Yet, there’s an untapped potential in $3 billion of liquidity and an emerging market of staking derivatives waiting to be harnessed. If Aether can mobilize even 10% of the ATOM supply within Aether DeFi, the impact would be substantial, unlocking significant value for ATOM. Idle liquidity leads to poor capital formation and inflates the token’s float unnecessarily.

This is a point of concern for me and builds upon the issue of going beyond the general EVM & canto playbook if this is to be successful in more ways than just an airdrop for users.

Rule #2 of Shark Tank. NEVER ever ever think if you can just get a small portion of a large market that you will be successful. That was the idea of every other generalized L1 and the main reason they’ve failed. No real purpose of vision. This has to go beyond just “build it and they will come”. Why would anyone build on a brand new EVM with low liquidity and low users over a few of the major L1s? Don’t forget, those other L1s have VC money and a better risk/reward profile than just about any new generalized EVM L1 that will pop up.

If your goal isn’t even to compete with other EVM L2s, what do you envision the reason why Aether gets adoption and becomes successful? Because just introducing innovations to a new ecosystem won’t lead to adoption. There’s a reason why most of the EVM users haven’t come to any EVM chains in the Cosmos, and also a reason why the Cosmos has almost a $3B valuation without an EVM. This chain must find its own lane and its own PMF if it is to achieve what you’re setting out to do. Even having a goal of being the first or main IBC connection to Ethereum and other major L1s is a need that is starting to be addressed, but would be prime for a consumer chain.

It is still very early in this proposal, so I’m sure there will be more information coming out and a lot of good input over the next few weeks. Going to take a step back to allow room for others and chime in once this starts to progress.

[aetherevm]

1.Polaris for now is closed source we cannot speculate on when/if its going to be open sourced. ATOM needs a hedging product now. At a later date we can reconsider polaris, but delaying launch indefinitealy to seek perfection is not a winning strategy.

2.Aether will be integrated in the DeFi mechanisms that will be launched and the Aether community pool will get a share of whichever revenue generating token Aether launches.

3.Yes

8.Agreed and part of the focus will be on creating the perfect conditions to make deployment desirable but not depending on it.

9.Dex is just one of many core primitives which will be deployed, value add will come from many angles. Aether shouldn’t be seen as just an EVM but bundle of core primtives.

There is no real play book besides that capital is trapped on an island, and can not express itself. This has been an ongoing issue for any network out side of Bitcoin. Eth did not get out of its airdrop and ICO phase until proper products were built so larger positions and more flamboyant investors could create dynamic hedging strategies to preserve principle of their native chain holdings and reduce spot market pressure. A lot of people expres failure in terms of how much money they made personally, or a winner takes all mentality. It is not really chain vs chain. Its chain vs legacy financial market which incorporates a plethora of industries from custodian, to settlement and more. These are the large players losing market share, as monoliths balkanize into more resourceful players.

Shark Tank is a TV show, and is not based in the reality (as a reality TV show) of crypto as seen over the last 13 years or more. Many of these micro networks do more international remittance than small nation states. The EVM products you speak of failed in terms of Atom and the Hub, because none of those players were Long Atom, nor stake holders of Atom. Anyone who is a versatile investor who must hedge dollar reflexivity will use such products. The FUD is counter to the empirical observation which you can see in networks all over the place. Large Atom stake holders simply want more dynamic hedging strategies so that principle can be preserved instead of drawing down spot price to service liabilities or having to sell when the dollar becomes expensive in the global credit market. Aether is not building the tool for the sake of the tool itself but rather for the intended use of the tool. The focus is on core primitives enabled by the EVM. Aether is not taking are taking a scarcity approach, it’s not a view that is shared here.

Blockchains are not in competing with each other. It is legacy finance that is in competition with blockchains. It is important to take the scalpel out even more. Blockchains compete with legacy finance already in lesser endowed nation states. A few are already competing in mass legacy finance in the hegemonies.

Tricky Thank you very much for the time and thoughtfulness of your replies. Looking forward to the continued feedback.

Thank you everyone for the feedback so far. If you asked a question that was missed, you can join the telegram ( Telegram: Contact @AetherEVM ) and ask there.

[velvetmilkman]

Lots of words here! Thanks for posting so much information.

One question:

1. Who are you?
2. Can you provide the same amount of detailed information about aether and the team as you have about nearly every other aspect?
3. please provide your names (or aliases), past work history, past projects, GitHubs, twitter handles, etc.
4. what makes you guys best positioned to launch an EVM? What experience do you have scaling projects successfully?

Ya know, normal stuff you would want to know.

[LeThang137]

My first thought is that it is another Canto but deployed as Cosmos Hub’s consumer chain, which is not attractive at all (at least for me). You shared a lot about revenue sharing but there is another critical question you haven’t delivered in this proposal:

How can Aether win against other EVM chains like Evmos, Berachain, Kava or L2s on Ethereum? How can Aether acquire the market share from other EVM chains?

AFAIK, Neutron’s goal is also to become a liquid staking Hub. How will Aether “grow the pie” instead of just competing directly with Neutron for liquidity?

[vixcontango]

Generally speaking, I am in favor of having an EVM consumer chain and this is a good sounding proposal. However, I want to avoid the Neutron scenario where a brand new consumer chain is forcing the validators to subsidize it. I am much more in favor of a process where a standalone chain is first created, product-market fit is demonstrated and once the chain generates enough revenue for validators to break even and its product fits the Cosmos Hub strategy then it can be promoted to a consumer chain and given the Cosmos Hub stamp of approval. Stride is an example of such a path to becoming a consumer chain.

So at present I would be against Aether becoming a consumer chain.

[liquidityflow]

Saw a lot of debate about the evm CC on twitter but i think this proposal has 0 downsides for the hub. Finally a good well thought proposal not asking for money, i don’t see any cons, the chain has been developed for free and ATOM stakers will get majority of the supply.
Neutron airdropped 9% of the supply and stride 6% of the supply and not entirely to ATOM holders, Aether will have the highest lvl of community alignment given a bigger % of the supply will be airdropped to the community.
Large community ownership of the supply outweighs any other downside people have pointed out.

TLDR:
This proposal should be supported as it breaks the trend of ATOM never getting anything for free.

[serejandmyself]

Yay. One more consumer chain which wont add any value to ATOM (no offense against the project itself)