Cosmos Intergalactic IBC Part 2: How to use IBC?
The Internet of Blockchains
In my previous article I wrote about what the IBC is and how is differs from existing scaling solutions for blockchains. In this article I will have a look at how the IBC functions in a practical sense and how to use it.
Currently the IBC is limited to moving coins/tokens from one chain to another but has great potential for chains interacting with each other in many other exciting ways into the future. The greatest function that is currently in use is in the form of Decentralized Exchanges (DEX’s). The most popular and functional DEX within the Cosmos ecosystem is currently, Osmosis. Osmosis is easy to use, fast and transaction fees are low to nil. Osmosis was launched in June of 2021 and has already listed 21 Cosmos SDK built projects, with more being listed almost weekly now. Osmosis uses the Cosmos Gravity Bridge protocol, which allows sovereign tokens from any chain connected to the IBC to be moved from one chain to another. Major tokens listed on Osmosis are Terra (LUNA) and their stable coin Terra USD (UST), Cosmos (ATOM), Crypto.com (CRO), Akash Network (AKT) and the latest smart-contract chain Juno (JUNO).
Another DEX that uses the IBC protocol to connect to chains within the Cosmos Ecosystem is Sifchain. Sifchain currently has connections to both the Cosmos IBC and the Ethereum EVM and has quite an extensive list of tokens available. The functionality of Sifchain is a little different to Osmosis in that it uses a peggy bridge in which tokens are pegged for use in the liquidity pools as opposed to Osmosis which uses sovereign tokens which are moved directly from the sovereign chain onto the Osmosis chain for use in trading and providing liquidity in liquidity pools on the Osmosis DEX. As such, arbitrage plays a bigger role in the use of Sifchain compared to Osmosis. Sifchain has listed a number of major chains that can be seen on the chart below.
The most recent addition to the Cosmos ecosystem DEX’s is Emeris. Emeris was built by the Cosmos development team and while it is still in the early stages of functionality, is intended to be a major part of the Cosmos ecosystem using the Cosmos Gravity Bridge to move sovereign tokens from one chain to another and provide liquidity through the use of liquidity pools, much like Osmosis. Emeris roadmap indicates that is intends to be the first one-stop portal to provide integrated wallet and multi-wallet support, access to multiple DeFi trading platforms, staking on multiple chains and a mobile wallet app. Emeris also aims to have a fiat on-ramp in the near future, removing the need for CEX fiat on-ramps and sending your coins from exchanges to wallets and around the ecosystem.
The last thing you will need to do to get started using the IBC will be to have a compatible wallet to hold your coins in self-custody. The recommended wallet is Keplr wallet (cloud wallet) and linking it to Ledger (physical USB wallet). It is the most secure way to store the private keys to your tokens. Another wallet which is very popular is Cosmostation which has a mobile app as well as a PC app. Once you have yourself setup with a wallet and have transferred your tokens to your wallet, the Cosmos is your oyster.
I’ll be deep diving into more chains and aspects of the Cosmos ecosystem over the coming weeks and months so subscribe if you haven’t already to keep up to date with everything Cosmos
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Networking between exchanges really sounds great. When I saw the exchanges and blockchains in the photo, I realized that it is a project with big goals, I hope you reach your goal.
WOW....I didn't realise how far Cosmos has come!
On the surface it looks really impressive.
It looks like it's time for me to put on my scuba gear on and do a deep dive into Cosmos...LOL