AMM (Automated Market Maker) serves as the ecosystem’s liquidity hub. Which AMM stands out in the Cosmos ecosystem, which is connected to numerous blockchains? Together, we will learn about What is Osmosis (OSMO), the AMM of the Cosmos ecosystem, in this review. Let’s research Osmosis together to learn more about it.
What is Osmosis (OSMO)?
Osmosis is a Layer-1 proof-of-stake (PoS) blockchain developed using the Cosmos SDK with the main objective of optimizing its design for a sandbox for automated market makers (AMMs.) The blockchain is the best option since it enables developers to design and produce customized AMMs by utilizing the blockchain governance system and modules from Osmosis.
Osmosis offered to trade and receive incentives through liquidity provision as the first AMM protocol on Cosmos. The Osmosis native token, OSMO, allows users to vote and make decisions about the network while also earning benefits for assisting in platform security. Additionally, Osmosis offers AMM software with OSMO and ATOM as its primary trading pairs.
Osmosis was the first Cosmos-based chain to make Inter Blockchain Communication (IBC) transactions commonplace. IBC transfers had been accessible for several months prior, but the connected chains had not experienced much demand. As a result, there were not enough IBC transfers.
Background of Osmosis
Osmosis was announced in October 2020 and introduced formally in June of the following year. This Cosmos SDK-created project uses the AMM protocol. Josh Lee, Dev Ojha, and Sunny Aggarwal were responsible for driving its development.
According to Osmosis, its vision is simple. It would concentrate on constructing a sandbox for AMM development rather than the standard procedure of producing a skeleton key to unlock the closed doors to AMMs strategies and their liquidity pools. Using the network’s already-established liquidity pools and modules, this protocol enables the creation of fresh, original AMM ideas.
How Does Osmosis Work?
Osmosis was designed from the beginning with IBC (Inter-Blockchain Communication) built in, enabling it to link to the full Cosmos chain ecosystem. Later this year, after integrating native Cosmos assets, Osmosis will integrate with chains that do not use IBC. Similar to Balancer, Osmosis allows for curve algorithm customization.
Osmosis enables market participants to identify the best bonding curve equilibrium for various use-case liquidity pools. Pools with Flexible Liquidity: Osmosis, like Balancer, enables users to dynamically add liquidity to pools with various ratios (66/34, 90/10, and 50/50). Because of this, more creative AMM techniques are appropriate for rapidly evolving markets like DeFi.
What Problems Does Osmosis Solve?
Osmosis coin is a cryptocurrency that seeks to solve the problem of high transaction fees and slow transaction times.
The Osmosis Team
- Sunny Aggarwa, a co-founder of Osmosis, was employed by Tendermint in 2017 as a research scientist. He established Sikka in 2018, a blockchain infrastructure business with a focus on joining networks and protocols for the decentralized internet. On the Cosmos Hub, Kava, and Akash networks, Sikka currently runs a Top 5 validator.
- Aggarwal worked with Josh Lee (co-founder of Osmosis) at Tendermint 2019. He later established Chainapsis, which produced the Keplr wallet. Keplr is a capable wallet for Cosmos and other services.
- Osmosis Partners with YouTube on COVID-19 Content : The COVID-19, post-COVID effects, and immunizations are just a few of the vital health issues covered in our new Clinician’s Series, a collection of interesting short videos.
- Osmosis and Konstellation Partner for DARC Token Incentive Pool: As Konstellation and its ecosystem projects concentrate on improving IBC capabilities, Osmosis Zone offers Konstellation a reliable partner using the Cosmos IBC protocol. Cosmos also offers a reliable DeFi partner for creating and trading liquidity pools.
- Osmosis’s collaboration with ALTCOINSTerraBridge: The value of any external incentive offered to a liquidity pool will likewise be matched by Osmosis. Consequently, significantly raised the payouts for mining liquidity on those pools and brought in even more liquidity than either reward program could have done on its own.
What Is OSMO Token?
The native utility and governance token for Osmosis, called OSMO, enables the basic network swap fee and the distribution of liquidity mining rewards. Osmosis’ special Superfluid Staking feature enables OSMO to be used for both staking and liquidity at the same time, allowing liquidity providers or stakers to profit from both supplying liquidity and staking. As a governance token, OSMO can be used to establish the base network swap charge, vote on protocol updates, and distribute liquidity mining rewards to particular liquidity pools.
Basic Information About OSMO
- Token Name: Osmosis
- Ticker: OSMO
- Blockchain: Cosmos
- Token Standard: Updating
- Contract: uosmo
- Total Supply: 1B OSMO
- Circulating Supply: 282,46 M OSMO
- Liquidity Reward Mining: 40.5%
- Developer Vesting: 22.5%
- Staking Reward: 22.5%
- Community Pool: 4.5%
- Strategic Reserve: 5%
- Airdrop: 5%
In order to support the development of the Osmosis automated market maker (AMM) protocol, the Osmosis Foundation has completed a $21 million token sale from its treasury. The foundation’s inaugural funding effort was spearheaded by Paradigm, with involvement from Robot Ventures, Nascent, Ethereal, Figment, and Do Kwon, CEO of Terraform Labs.
Price of OSMO Today
- The current price of Osmosis is $1.21, and its 24-hour trading volume is $10.38 M. In the previous day, OSMO increased by 1,23%. It is currently 1,90% lower than its 7-day high of $1,23 and 4,82% higher than its 7-day low of $1,15.
- Market Cap: $325,311,263
- 24H Volume: $11,034,893
What is OSMO Used For?
The Osmosis protocol’s strategic direction and potential updates can be decided by token holders using the governance token Osmo (OMSO). The following are the primary uses of Osmo that are anticipated (but governance may decide to add or delete some of them):
- Staking: At the consensus level, validators and delegators employ OSMO as the staking token to validate transactions and create new blocks. For supplying resources to the network, these contributors are compensated with inflation.
- Governance: Holders of OSMO tokens can take part in on-chain governance by submitting and voting on proposals for governance, such as allocating liquidity mining rewards to liquidity pools or determining the essential network swap cost.
How to Buy OSMO Tokens?
- Purchase an IBC-capable cryptocurrency on a marketplace.
- Send the cryptocurrency with IBC support to your Keplr Wallet.
- Osmosis and Keplr Wallet connected.
- You should add your IBC-compatible cryptocurrency to Osmosis.
- Trade Osmosis for your IBC-enabled cryptocurrency.
How to Store OSMO Coins?
Users should use the Keplr wallet, according to Osmosis’ advice, for the optimum platform interaction. Users can save and receive OSMO coins using this wallet directly connected to Osmosis.
Other options include using hot wallets or cold wallets, you should consider Trust Wallets or Metamask for the best.
Goals of Osmosis
To broaden the use of AMMs inside the Cosmos ecosystem beyond conventional token swap-type use cases, Osmosis aims to deliver best-in-class tools.
- The primary goal of the Osmosis blockchain is to provide a decentralized platform that enables users to securely and efficiently share data and other digital assets.
- The Osmosis blockchain is designed to be highly scalable and able to support a large number of transactions per second.
- The platform is also intended to be user-friendly and easy to use.
Prospect Of OSMO
With this in mind, let’s search for the most recent Osmosis cryptocurrency price forecast. When this article was written, DigitalCoinPrice predicted that OSMO would reach a value of $1.37 in August and $1.28 in December of this year. The website says the average price will be $1.36 in 2023. Osmosis is predicted to cost $1.87 in 2025 but $1.67 in 2026, by the forecaster. The website then projects a general upward trend year over year, forecasting an Osmosis price of $4.35 in 2030.
How to earn OSMO tokens?
OSMO tokens can be earned by participating in the OSMO token sale.
Should you invest in Osmosis?
Investing is a very private activity. Conduct your study and stay current on any changes to the osmosis ecosystem that can improve or jeopardize its prospects. Keep in mind that investing can be dangerous, so you should always do your homework. Likewise, never risk investing funds that you cannot afford to lose.
Is investing in OSMO risky?
There is always risk involved when investing in a company or product. However, the potential rewards of investing in OSMO may outweigh the risks.
Why is Osmosis popular?
- First, it is one of the few coins that allows users to earn interest on their holdings.
- Second, it has a low transaction fee, which makes it attractive for small transactions.
- Finally, it has a strong community backing it, which gives it additional support.
Is it the right time to buy OSMO?
It is difficult to say whether it is right to buy a particular stock. Many factors must be considered, including the current market conditions, the company’s financial stability, and the investor’s risk tolerance.
What can I buy with OSMO?
You can buy various things with OSMO coins, including cryptocurrencies, fiat currencies, goods, and services.
How is Osmosis different from other blockchain projects?
Osmosis is designed to be highly scalable, able to process millions of transactions per second.
Can I convert Osmosis coins to other currencies?
You can convert Osmosis coins to currencies such as US Dollar and CAD. With the help of the Osmosis cryptocurrency converter, you can quickly convert OSMO to US dollars. Currently, 1 OSMO is worth $1.18.
How can I find more information about Osmosis?
You can find more information about Osmosis coin on the official website and the Osmosiscoin subreddit.
Selecting an AMM to invest in is difficult given the recent proliferation of AMM on the DeFi market. I think the in-depth details I’ve just given you about Osmosis will help you decide whether to invest in it or not. Please feel free to ask any questions about osmosis in the comments below.
Disclaimer: The information provided in this article is not investment advice from Cove Markets. Cryptocurrency investment activities are yet to be recognized and protected by the laws in some countries. Cryptocurrencies always contain financial risks.