You need to understand some basics before we can dive into the ATOM price prediction for 2023.

Cosmos is an ecosystem of independent parallel blockchains, each powered by classical Byzantine Fault Tolerance (BZT) consensus algorithms, such as Tendermint. Not to be confused with [the Cosmos ecosystem](/news/article/cosmos-crypto-explained), Cosmos Hub (ATOM) is one of the many blockchains on this network.

Cosmos Hub connects to several other blockchains (aka zones) via the Inter-Blockchain Communication Protocol (IBC) – a state-of-the-art interoperability protocol. At the time of writing, the primary role of ATOM is to secure Cosmos Hub through a staking mechanism. 

https://cryptocurrencynews.com 

![Screenshot 2023-02-20 at 15.03.56.png](https://s3.eu-west-2.amazonaws.com/prod-monitalks-media/Screenshot_2023_02_20_at_15_03_56_e08ea90cf8.png)

Source: [Cosmos ecosystem](https://cosmos.network/)

## Cosmos Hub and ATOM

Cosmos Hub serves as the economic centre of the Cosmos ecosystem, providing crucial services to the ‘Interchain’ – a new internet consisting of an extensive network of interconnected blockchains. These services include the following:

•	The blockchain operates a next-gen DEX, Gravity DEX, allowing for quick and cheap cryptocurrency swapping across the Interchain.

•	The Interchain Security feature positions ATOM at the centre of security for multiple chains in return for additional staking rewards.

•	As an ecosystem router, the blockchain establishes IBC connections with compatible chains and operates decentralised bridges with ecosystems such as Bitcoin (BTC) and Ethereum (ETH).

•	The blockchain is at the ecosystem's crossroads and is, hence, extremely secure. This makes the blockchain ideal for serving as an asset custodian and account management hub.

We can see that ATOM plays a significant role in securing the above services. In return, staking rewards and transaction fees are distributed to ATOM stakers. The cryptocurrency serves as a voting mechanism in governance as well.

We can also see that the Interchain Security feature may play an important role in the ATOM price prediction for 2023. The Interchain Security protocol went live in January, so ATOM may pick up significant momentum in Q1 2023. Let us explore the cryptocurrency's market cap and historical data to understand better ATOM price prediction and its potential ceiling.

## ATOM market cap and historical data

The crypto asset has an infinite token supply, with a circulating supply of nearly 300M, a [market cap of](/news/article/what-is-market-cap-in-crypto) just over $3.4B, and a 24-hour trading volume of ~$200M – all at the time of writing.

If we look at historical price data over the previous month, the crypto token has experienced a significant surge in price, with a low of $8.96 on 20 December, 2022, and a high of $13.30 on 14 January, 2023. In other words, ATOM grew in price by nearly 50% in this interval! At the time of writing, the cryptocurrency is valued at $14.44.

ATOM achieved $15.57 on 6 November, 2022, and fell to $8.64 on 17 December, 2022. Truth be told, the crypto token had a volatile year, as did most in the crypto space.

If we look at statistics in 2022, ATOM reached an all-time high of $44.45 on 17 January, 2022, before plummeting to $6.32 on 17 June, 2022.

So far, we have explored the importance of Cosmos Hub and how ATOM is at the epicentre of the blockchain. We also dived into historical data and discovered that ATOM had a year of many highs and lows in 2022.

To understand how ATOM may fare in 2023 and make a price prediction, we need to understand the importance of Cosmos in the general scheme of things, ecosystem features/collaborations that may spark further interest in ATOM, and the health of the crypto sphere at large.

## ATOM price prediction: factors to consider

To make an ATOM price prediction for 2023, here are some factors to consider:

### Interchain Security rollout

A key factor to consider in Q1 2023, especially, is the importance of the Interchain Security feature rollout. Having launched in January 2023, the Interchain Security protocol may play a vital role in the further adoption of the blockchain ecosystem.

Cosmos is an ecosystem of more than 200 blockchains, the central blockchain of which is Cosmos Hub. The blockchain ecosystem previously allowed developers to build application-specific blockchains only if they could manage their validators. The problem is, developing a validator set from scratch is not a piece of cake – it is time and resource intensive.

This is where Interchain Security comes into the picture. With this feature, developers can now build new application-specific blockchains and secure them using the same security validators that run Cosmos Hub.

Furthermore, these blockchains will send fees to those security validators, further incentivising ATOM stakers – this is a crucial point to note.

Essentially, this feature enables Cosmos to emulate the [design of Polkadot (DOT)](/news/article/polkadot-price-uk). On Polkadot, each application-specific blockchain, by default, shares its validator security with the central relay chain.
Initially, this feature was set to be rolled out in August/September 2022, but was delayed. At the time, Cosmos contributors stated:

“Interchain Security will emerge as the premier method for projects to get the highest level of security in Cosmos by leveraging the entire 175+ Cosmos Hub validator set.”

Ideally, the rollout of this feature will see increased developer activity on the blockchain ecosystem and further adoption of the crypto asset, with increased staking rewards on the horizon. Overall, this feature is expected to make the blockchain ecosystem simpler to use, cheaper, and quicker.

### Cosmos as an ecosystem is a game-changer

Thanks to the IBC, Cosmos has become the Interchain. As a high-speed interoperability platform, Cosmos has gained significant traction (pretty obvious from the wild price statistics in 2022!). One of the pressing issues affecting the crypto space is a lack of composability between blockchains in different ecosystems.

The blockchain ecosystem solves this problem and serves as a viable alternative to slow, unscalable, expensive, and [environment-damaging PoW protocols](/news/article/pos-vs-pow). IBC makes it easier for the blockchain sphere to communicate seamlessly, thereby attempting to eliminate fragmentation between different blockchain ecosystems – the ultimate goal.
To put this into perspective, Cosmos allows interoperability with Bitcoin and Ethereum via bridges. A bridge to Polygon is awaited and, too, may play a major role in ATOM’s price rise.

Several popular blockchains, including Binance Chain (BNB) and Crypto.com Coin (CRO), are built using the Cosmos software development kit (SDK). We may see numerous new players building on Cosmos very soon.

### ATOM tokenomics

The rollout of the Interchain Security feature was expected to see ATOM's new tokenomics structure come into play, with a transitory phase of 36 months. The ATOM 2.0 proposal, though, was rejected by the community on 15 November, 2022.

With an infinite token supply, the cryptocurrency's tokenomics structure is based on inflationary dynamics.
To put this into perspective, there were 214M tokens in circulation in March 2019, compared to the ~300M tokens in circulation today – an increase of nearly 40%. The new tokenomics structure proposed the issuance of 10M ATOM tokens per month, with the issuance rate steadily decreasing to 300,000 tokens per month, thereby bringing down the cryptocurrency's inflation rate to 0.1%.

You must factor in the tokenomics of ATOM when making a price prediction. The supply of the cryptocurrency will keep increasing exponentially.

## ATOM price prediction: verdict

All said and done, there is no roof to the potential ATOM has. Having highlighted each of the factors that may play a role in the crypto asset’s price rise in 2023, it is fair to say that ATOM is a good long-term investment option.

Cosmos solves one of the most pressing issues affecting the crypto sphere – a lack of interoperability and composability. Cosmos and Polkadot are among the few players who have set out to solve this problem and are doing a great job as we speak. The rollout of the Interchain Security feature is a game-changer for the ecosystem, as it will bring about several changes.

The market situation has not been the greatest of late, so make sure you invest wisely. On a concluding note, keep an eye on the latest Cosmos news and DYOR at all times!


ATOM Price Prediction 2023 

Cosmos crypto is a network of numerous autonomous blockchains known as zones.
The zones are driven by [Tendermint](https://tendermint.com/) BFT, which provides a high-performance, reliable, and secure PBFT-like consensus engine with stringent fork-accountability guarantees over malicious actors' behaviour.

Tendermint BFT is an excellent choice for scaling public proof-of-stake (PoS) blockchains.
Cosmos crypto is a multi-asset PoS cryptocurrency with a simple governance system that allows the network to adapt and update.

## Functions of Hubs and Zones 

The Cosmos crypto network's Hub and zones connect through an inter-blockchain communication (IBC) protocol, which is like a virtual UDP or TCP for blockchains.

Tokens may be moved securely and swiftly from one zone to another without the requirement for liquidity exchange. All inter-zone token transactions are instead routed through the Cosmos Hub, which maintains track of the total number of tokens owned by each zone.

Each zone is separated from the non-success of other zones by the hub. Zones provide future compatibility with new blockchain breakthroughs since anybody may connect a new zone to the Cosmos Hub. 
This design addresses several current issues in the blockchain field, such as application compatibility, scalability, and seamless upgradability. Zones produced by other blockchain systems may be connected to the Cosmos Hub. Cosmos can grow indefinitely to accommodate global transaction demand because of these zones. Zones are particularly well-suited to dispersed exchanges, which will be enabled.  

Cosmos crypto is more than a single distributed ledger, and the Cosmos Hub is not a fortress or the centre of the cosmos.
The aim is to develop a protocol for an open network of distributed ledgers that will serve as a new basis for future financial systems based on cryptographic, sound economic, consensus theory, transparency, and accountability principles. 

## Public Blockchain

The Cosmos crypto Hub is the Cosmos Network's first public blockchain, powered by the Tendermint BFT consensus algorithm.
The Tendermint open-source project was founded in 2014 to solve [Bitcoin](/coins/btc)'s proof-of-work (PoW) consensus algorithm's speed, scalability, and environmental challenges.

The Tendermint team was the first to conceptually demonstrate a PoS cryptocurrency that addresses the nothing-at-stake problem suffered by first-generation PoS cryptocurrencies such as NXT and BitShares1.0 by using and improving on proven BFT algorithms developed at MIT in 1988. 

All Bitcoin mobile wallets now employ trusted servers to offer transaction verification. This is because PoW needs many confirmations before a transaction can be regarded as permanently committed. On platforms like as CoinBase, double-spend attacks have already been proven. Tendermint, unlike other blockchain consensus systems, provides immediate and provably secure mobile-client payment verification. Because the Tendermint is designed to never fork, mobile wallets may get fast transaction confirmation, making trustless and practical payments possible on cell phones. This has far-reaching implications for the Internet of Things applications.

Validators in Cosmos crypto perform a similar function to Bitcoin miners, but instead vote using cryptographic signatures. Validators are secure, specialized computers in charge of committing blocks. Non-validators can delegate their staking tokens (dubbed "atoms") to any validator to receive a percentage of block fees and atom rewards, but they risk being penalised (slashed) if the delegate validator is hacked or breaches the protocol.
Tendermint BFT consensus's established safety guarantees, as well as the collateral deposit of stakeholders–validators and delegators–provide demonstrable, measurable security for nodes and light clients. 

Validators and delegators on the Cosmos crypto Hub can vote on proposals to automatically adjust system default settings, coordinate upgrades, and vote on revisions to the human-readable constitution that governs the Hub's rules. The constitution promotes stakeholder cooperation on issues such as theft and bugs (such as the TheDAO incident), allowing for faster and cleaner resolution. 

Each zone might have its constitution and governing process. The Cosmos Hub, for example, might have a constitution that guarantees immutability at the Hub (no rollbacks except for defects in the Cosmos Hub node implementation), but each zone can specify its rollback policy. The Cosmos network provides maximum freedom and the opportunity for permissionless experimentation by facilitating interoperability among different governance zones. 

On this basis, the Cosmos crypto Hub runs several distinct blockchains known as "zones". A steady stream of recent block commits from zones placed on the Hub helps it maintain track of each zone's current condition. Similarly, each zone monitors the Hub's status. Packets of data are then transmitted from one zone to another by publishing Merkle-proofs as proof that the data was delivered and received. This technology is commonly known as inter-blockchain communication, or IBC for short.  

Since the Cosmos crypto Hub serves as the primary ledger for the entire system, its security is critical. While each zone can be secured by as few as four Tendermint blockchains, the Hub must be secured by a globally decentralised set of validators capable of withstanding the most severe attack scenarios.

## Zones 

A Cosmos zone is a self-contained blockchain that uses IBC messages to connect with the Hub. According to the Hub, a zone is a multi-asset dynamic-membership multi-signature account that may send and receive tokens using IBC packets. A zone, like a cryptocurrency account, cannot send more tokens than it has, but it can accept tokens from those who do. A zone can be designated as a "source" of one or more token types, allowing it to raise the supply of those tokens. 

Validators of a zone connected to the Cosmos Hub may stake atoms of the Cosmos Hub. While double-spend assaults on these zones would result in the cutting of atoms with Tendermint's fork accountability, a zone with more than 2/3 Byzantine voting power can commit an incorrect state.

Because the Cosmos Hub does not validate or execute transactions committed on other zones, users must deliver tokens to zones they trust.
In the future, the Cosmos Hub's governance system may approve Hub upgrade requests that consider zone failures.


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