Osmosis is a decentralized peer-to-peer blockchain that anyone can use to create liquidity and trade tokens via IBC. Blockchain Osmosis is a software that includes features such as free, public and open source. Using Osmosis will involve various risks, but are not limited to, such as loss of digital assets being supplied to Osmosis mining pools and losses due to fluctuations in token prices within a pair. transactions or liquidity pools, including temporary losses.
Before using any mining pools on the Osmosis blockchain, investors should review the relevant documents to ensure they understand how Osmosis and the pools work. Also, just as investors can access their email accounts, through various email software and protocols, such as SMTP, they can also access Osmosis pools through a number of web browser or mobile platform. It is the investor's responsibility to do the necessary research on such interfaces to understand the fees and risks they carry.
As described in the Osmosis license, this protocol works according to what is programmed, so there are risks when entering the financial investment market. At the same time, the protocol does not have any form of insurance for users. Although the Osmosis Labs company developed much of the original source code for the Osmosis protocol, the team does not provide, own, or control the Osmosis protocol, which is run by a decentralized community of Osmosis. authentication buttons.
Protocol upgrades and modifications are managed by the community, by OSMO governance token holders. No developer or organization involved in the creation of the Osmosis protocol will be liable for any claims or damages related to the use, inability to use, or interaction of the user. with other users of the Osmosis protocol. This includes any direct, indirect, incidental, special, or loss of profits, cryptocurrencies, tokens, or anything else of value.
Osmosis is a Layer-1 blockchain using the Proof-of-Stake (PoS) protocol, built using the Cosmos SDK, optimized its design to be a sandbox for market-making models. automatically (the AMM). This chain allows developers to design and deploy customized AMMs, using various modules and leveraging Osmosis's on-chain governance system.
Osmosis's native token is the OSMO token, which gives holders the right to vote on proposed changes as well as earn rewards for helping to secure the network. Its first application was an AMM that provided the ATOM and OSMO trading pairs as an initial basis.
The advent of automated market-making models (AMMs) has ushered in a new era of virtual currency economic utility and bonding curve applications. AMM has become an essential element of DeFi's infrastructure. At the same time, every new ecosystem must have an exchange with liquidity pools to support the underlying token swap and the creation of additional financial products.
Osmosis is an AMM protocol created using the Cosmos SDK. The project was announced in October 2020 and launched on June 19, 2021. The core development team of the project consists of Sunny Aggarwal, Josh Lee and Dev Ojha. Osmosis's vision is that instead of aiming for a one-size-fits-all strategy for all AMMs and their liquidity pools, they create a sandbox for AMM growth. This protocol allows developers of new AMM models to clone and customize liquidity pools and modules already running on the network. The protocol also has an on-chain governance system, allowing stakeholders of an AMM pool (i.e. liquidity providers) to control and direct their pools.
Osmosis is the first Cosmos-based chain to help popularize IBC transactions. Although it appeared a few months ago, there was little actual demand from the connected chains, so IBC transaction volumes were extremely low. As the first AMM on Cosmos, Osmosis offers the ability to trade and earn rewards through providing liquidity. Users can refer to the IBC transfer volume for more information .
Osmosis's modules allow developers to customize their transactions and price curves based on various parameters, including token swap costs, token weights, and computational costs in the TWAP protocol . The network serves as a sandbox for AMMs, where developers can experiment with time-dependent assets, volatility indices, and off-chain oracles as inputs to their product. Project teams can also use these modules to create additional DeFi asset classes or protocols such as stocks and flexible cost markets.
The network allows new developers to take advantage of existing IBC connections, order flows, and liquidity. As a result, development teams do not have to create and initiate liquidity for new AMMs from scratch, eliminating the need to upgrade to a new AMM for each contract or module upgrade.
The two co-founders of the Osmosis project are Sunny Aggarwal and Josh Lee.
No specific information yet.
The Osmosis Foundation has raised a total of $21 million in funding through a funding round. This is an ICO round announced on October 27, 2021, led by Paradigm, in addition to other entities such as Robot Ventures, Nascent, Figment, Ethereal Ventures and Do Kwon – the founder of Terra ecosystem.
Osmosis's token, the OMSO token, is a governance token that allows token holders to decide the strategic direction of the protocol, and to vote on future modifications. Some information about OSMO tokens:
Osmosis launched with an initial supply of 100 million tokens. The development team airdropped 50% of OSMO tokens to participants who staked with ATOM tokens (based on a snapshot of the Cosmos Hub chain on February 18, 2021). The other half of the initial token supply has been moved to an on-chain storage called the Strategic Reserve. This resource allocation policy will be controlled by a multi-signature DAO, which will initially include members of the development team. The team intends to expand membership to the community to ensure transparency and decentralization.
According to the development team, the DAO should use the Strategic Reserve to provide grants or strategic investments, in project teams that will improve the Osmosis protocol adoptions.
Unlike most Cosmos SDK chains, where tokens are distributed on a per-block basis, Osmosis opens in the form of a daily cycle and releases new tokens at the end of each cycle.
Under the original token model, new tokens will be issued on a “thirdening” schedule. Similar to the halving in Bitcoin, every 210,000 blocks mined, or roughly every four years, the block reward given to Bitcoin miners for processing transactions is cut in half. In Osmosis, the issuance of tokens will be cut by a third every year.
The schedule for the triplets is as follows: In the first year, a total of 300 million tokens will be issued. After 365 days, this part will be cut by a third, so a total of 200 million tokens will be issued in year 2. In year 3, a total of 133 million tokens will be issued. This triple fork will continue until OSMO reaches its maximum supply of 1 billion tokens.
The newly issued tokens will be distributed as follows:
Osmosis Governance Proposal #2 establishes an initial liquidity mining reward schedule. Tanks with the most potential total key value (TVL), get the majority of the LP rewards. This reward scheduling and scaling is subject to on-chain governance of Osmosis.
OSMO is intended to be used primarily for the following purposes (but administration may decide to add or remove some):
The development team and user community have also deployed OSMO tokens as part of the network's liquidity mining program. Users can earn OSMO tokens by depositing liquidity into mining pools on Osmosis. Liquidity mining is a popular growth hack that generates liquidity, making AMMs a more attractive option for traders.
The OSMO token is now listed on the MEXC exchange, and can be purchased on the Osmosis platform itself.
Total trading volume and TVL in the Cosmos ecosystem are lifting similar metrics at Osmosis DEX, resulting in the OSMO token price reaching all-time highs.
One of the biggest factors driving the price of the OSMO token is the significant increase in trading volume on the exchange. According to data from Token Terminal, trading volume hit a record high of $186.8 million on January 7, 2022, and a new all-time high was set on the same day.
OSMO price vs DEX trading volume. Source: Token Terminal
The spike in trading volume and token prices quickly led to Osmosis becoming the third-ranked DEX by market capitalization.
According to data from SmartStake, other factors that have helped support the OSMO token price as trading volume has increased include the fact that over 81 million OSMO tokens are currently staked on the network. Furthermore, a large portion of the supply is also being used to provide liquidity in the various liquidity pools offered on Osmosis.
The second growth factor driving the price of the OSMO token is the steady increase in the total value locked on the protocol, which hit a record $1.21 billion on January 11, 2022, according to data from Defi. Llama.
Total value locked on Osmosis. Source: Defi Llama
TVL escalation comes as many tokens in the Cosmos ecosystem reach new highs. Notably, ATOM, the most recognizable asset from Cosmos, hit a daily high of $43.64 on January 7, 2022, $1 below its all-time high. . Osmosis's second native token, ION, also hit a new high at $16,500 on January 11, 2022.
The third reason for the bullish trend in OSMO is Cosmos' growing attention to EVM compatibility and cross-chain bridges.
Evmos is a project currently in development to be the first IBC-compatible EVM chain, and it is currently supporting ERC-20 tokens on its test network.
Injective, an L1 protocol, has also revealed that it is developing cross-chain bridges for projects built on Cosmos and it is currently working on OSMO token support.
As cross-chain bridges come online and allow tokens from other EVM-compatible networks to connect to the Cosmos Hub, Osmosis has the potential to increase transaction volume and TVL simply because it is the primary DEX for the system. Cosmos eco at the moment.
If the above 3 points continue to play out, there is a potential for the OSMO token price to rise even higher.
As the most popular DEX in the Cosmos ecosystem, Osmosis has positioned itself as one of the first Cosmos Dapps that many newcomers interact with. However, it seems that the Osmosis mission is not simply a fundamental pillar in Cosmos.
Given the potential to connect other blockchain tokens (such as ERC-20) into a network where value can be transferred quickly and cheaply, the road ahead for Osmosis is extremely promising.
Much of the network's initial traction seems to revolve around providing liquidity and staking. By design, Osmosis is a very interesting case study of how a DEX can provide an alternative to yield farming operations, potentially leading to a better and more stable trading experience for everyone.
If interested in the Osmosis project, investors can access the project's communication channels:
Website | Project Information | Twitter | Telegram | Medium | Reddit | Mintscan | GitHub | Discord
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