This soaring crypto just became an even better buy

During the last two months, Cosmos (ATOM 0.11%) has been one of the best performing altcoins in the crypto world. So it’s understandable that investors have been looking forward to Cosmoverse, the annual Cosmos developer conference that takes place in Medellín, Colombia.

This year’s event promised a big surprise for investors, and Cosmos did not disappoint. At the conference, Cosmos announced a new strategic roadmap called ATOM 2.0 to make the crypto even more attractive to investors, developers and users.

Renewal of the Cosmos Hub

A key component of the new ATOM 2.0 strategy is finding new uses for the Cosmos Hub, which is the blockchain at the center of the Cosmos blockchain ecosystem. Cosmos bills itself as the “Internet of Blockchains,” meaning its goal is to allow different blockchains to communicate with each other. A core component of this vision has been a simple, easy-to-follow template for other blockchains to join the Cosmos ecosystem. That was the whole purpose of the Hub. The Hub didn’t really do anything else, but it helped the “Internet of Blockchains” grow rapidly.

Image source: Getty Images.

As part of ATOM 2.0, Cosmos plans to add much more utility to the Hub. In other words, the Hub will do more than just provide a template for other blockchains. It will now offer services, especially for security and scalability, that will help other blockchains grow and thrive. At the Cosmoverse event, the Cosmos team compared the old Hub to a “model home” that potential homebuyers could check out before deciding to buy. By the same analogy, the idea is that the new, renewed Hub will be much more like a “school” or “police station” that can increase the overall value of a neighborhood by providing real services.

New changes in ATOM

The new ATOM 2.0 strategy also introduced something called “liquid staking”. This is a new iteration of the traditional staking process, where investors stake crypto in exchange for rewards. With staking, you agree to lock your crypto for a specified period of time, after which you get your original crypto back. During the lockup you earn rewards. Right now, for example, you can bet Cosmos on a major cryptocurrency exchange like Coin base (COIN -7.98%) and get 5% annual percentage return on your investment.

Liquid staking, on the other hand, allows investors to stake their crypto AND receive another token in return at the time of staking. You can immediately see why floating staking is superior to traditional staking. With traditional staking, the total return consists of your staking rewards plus any appreciation of your underlying crypto. With floating staking, you earn all of this, plus any additional rewards you may receive from the new tokens you received upon staking. It almost sounds too good to be true, but popular cryptos such as Ethereum (ETH 0.29%), Solana (SUN 2.05%)and Polygon (MATIC 3.32%) also offers variants of liquid staking.

Is Cosmos a buy?

Heading into 2023, I am very excited about the prospects for Cosmos. I think the “Internet of blockchains” approach has a good chance of resonating with investors. New York-based money manager VanEck, for example, set a $140 price target on Cosmos in mid-August. That represents more than a 10x return, given today’s price of around $13 for Cosmos. Across social media, investors are now talking about Cosmos as one of the cryptos most likely to “explode” in 2023.

You can take some of these social media predictions with a grain of salt, but Cosmos appears to be making a truly strategic move into the “multi-chain” future. In this future, all blockchains will be interoperable and scalable. It will be seamless to move digital assets across blockchains, and any blockchain will be able to talk to any other blockchain to exchange data and information. That’s not the case now, but that’s the future Cosmos is building. As a result, I am bullish on Cosmos. At a price of not quite $13, I think it’s still significantly undervalued.