Decentralized trading platform dYdX recently announced its intention to launch its own chain based on the Cosmos network and leave the currently used Ethereum Layer-2 (L2) ecosystem. After this announcement, many investors and builders began to pay more attention to the differences between the Ethereum and Cosmos networks.
The various benefits offered by Cosmos
On July 14, Dunleavy’s account posted on Twitter information that dYdX plans to leave the Ethereum Layer-2 (L2) ecosystem to launch its own channel on Cosmos. You should know that the Cosmos network is very efficient today. He offers more flexibility than other networks when it comes to security, design, inflation rate, transaction fees, etc. It allows manufacturers easily create their own channel and give value to his native sign.
On the other hand, Ethereum (ETH) is currently not very flexible, with various restrictions for manufacturers. Note that the Ethereum L2 network offers a higher level of security at relatively low protocol costs, with more robustness. That said, on the Cosmos network, token security is less of an issue since their values increase quickly. Moreover, the network it promotes interoperability between ecosystems.
According to Dunleavy, “Cosmos also avoids a centralized vector that L2s currently have in their sequencers“. Otherwise, “if Cosmos becomes a viable alternative, ATOM is clearly underpriced against ETH […] especially since the ATOM token is accumulating more value thanks to the launch of cross-chain security“. You should know that the market capitalization of the ETH crypto is currently about 60 times higher than that of the ATOM crypto.
Decentralized trading platform dYdX recently announced the launch of its own chain, dYdX V4. The latter will be based on Cosmos (ATOM) as well as the Proof of Stake (PoS) protocol. And dYdX plans to leave Ethereum (ETH) for the Cosmos network because “it would allow it to build the best overall decentralized protocol”.
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