May 25, 2023
7 min read
Osmosis (OSMO) is an Automated Market Maker (AMM) that allows users to create unique liquidity pools managed by the community itself, rather than a smart contract.
OSMO the currency, is a native token of that blockchain, used for voting, staking, and to providing liquidity to the pools. In order to provide liquidity and security to the network, Osmosis is using a unique protocol, called superfluid staking.
Osmosis is a DEX and an AMM for the Cosmos ecosystem, so it shouldn't come as a surprise that the project was launched by the members of the Cosmos team: Sunny Aggarwal and Dev Ojha. Josh Lee and Tony Yun from Keplr wallet also contributed.
The team set out with the goal of providing the tools that could provide additional use cases for AMMs within the Cosmos ecosystem by giving the developers more tools than any other AMM before. They refer to this concept as 'AMMs as serviced infrastructure'.
Before diving into what makes Osmosis unique, it would be a good idea to get a general understanding of the Cosmos ecosystem, since Osmosis was built specifically for that ecosystem.
The overarching goal of Cosmos is to create an ecosystem of blockchains that are connected to each other. Decentralized applications (or DApps) that are compatible with one another and able to get data and assets traded between various blockchains using the Cosmos Inter-Blockchain Communication protocol.
At the center of this interconnected network of blockchains is the Cosmos hub.
It is the mainchain that serves as the primary blockchain for others to connect to. It's a blockchain built on the proof-of-stake consensus mechanism and has ATOM as its native currency. ATOM is used for staking, voting, and covering transaction fees.
Cosmos developers also provide the Cosmos software development kit (SDK) and it is with that SDK Osmosis was created.
So, what does make Osmosis unique? Well, it allows users to create their own liquidity pools with unique parameters, while most other AMMs simply create pools and allow users to join.
In short, a liquidity pool is a bunch of coins locked in a smart contract. These pools that users can deposit their currency into offer a limited number of options, such as slight changes to the swap fee. This is a robust model that allows for the quick onboarding of new users.
In the DeFi market, however, there is a need for a liquidity pool to react to changes swiftly. Determine the next step and avoid losses for liquidity providers. The optimal swap fee might need to be changed considerably, depending on transaction fees, trade volume, volatility, and other factors.
The limited tools the pools supply their users with may no longer cut it.
This is where Osmosis comes in. The tools that this AMM provides to the users allow them to quickly adjust various pool parameters if the market situation calls for it.
This fine-tuning allowed for the Superfluid Staking consensus protocol. Superfluid staking allows users to earn rewards while also helping secure the network, maintaining the ecosystem efficiency even at peak trading volume, when the number of transactions rises significantly.
Osmosis has its own governance token, OSMO. Token holders can stake their OSMO to a specific validator and receive staking rewards and voting rights in return. OSMO has a total supply of 1 billion tokens, 492 590 761 OSMO of which are in circulating supply.
After the initial release of 100 million OSMO coins at genesis, new coins are released at the end of each epoch, every day.
The amount of OSMO released each year is cut by a third. In other words, 300 million OSMO is released during the first year, 200 million during the second, and so on.
Osmosis price currently sits at 0,921944 US dollars with a 24-hour trading volume of 26 638 043 USD. The current market cap is 454 141 011 USD.
The highest price point was achieved in March of 2022. OSMO price went as high as 11.21 USD. In July of the same year, the Osmosis price reached its all-time low of 0.75 USD.
Osmo currently ranks #76 on the CoinMarketCap, list. Said list ranks assets according to their market cap.
While market cap and OSMO price are very interesting points of speculation by those interested in OSMO token, the Osmosis AMM will continue to be the main focus of the Osmosis team in the future.
Stableswap AMM, aimed at providing an even better swap experience for the liquidity pools with assets of the same price, is almost ready.
Another upcoming feature of the Osmosis network is volatility awareness. This feature will allow the liquidity pools the ability to function as sophisticated market makers by auto-removing liquidity during times of extreme volatility. The volatility awareness is accomplished much easier on Osmosis than on other blockchains since it already has very low fees, which makes position management considerably cheaper.
Autonomy is an Osmosis ecosystem-building tool that will facilitate on-chain conditional execution.
Conditional execution is used for placing orders, such as limit orders or stop orders tools without which you can't imagine a modern-day DEX.
There are a number of teams building on and with Osmosis: the aforementioned Autonomy, for example.
However, there are also teams that have announced their plans to incorporate already existing projects into the Osmosis DEX. Bridges is exactly what's going to help with that.
Bridges facilitate cross-network currency integration. There are plans of introducing assets from such networks as Solana and Bitcoin, along with the creation of its own USDC token, native to the Osmosis ecosystem.
Such developments will, of course, be accompanied by further improvements to the UX. The goal here is to allow users to trade and bridge their assets using the Osmosis interface, without having to go 'outside', to other platforms.
OSMO is fully supported in Atomic Wallet.
You have access to all the info you need to know about a currency. You can keep track of the price (you can set the price to be shown with any currency, whether it's the Euro or Hong Kong Dollar!) market cap, price change over the last week, and other useful data. No swings in Osmosis price will escape your attention.
If you already managed to buy Osmosis and wish to store it in a decentralized, non-custodial wallet, Atomic Wallet will suit your needs perfectly. It's easy to deposit OSMO into it and store it safely.
You can also exchange your OSMO in Atomic Wallet for another currency if you are interested in leveraging the price swings and giving other coins, like Bitcoin, a shot.
The goal of the project is to create a much more customizable AMM protocol.
With its focus on customizability, Osmosis ecosystem allows for creating of custom liquidity pools, which are able to react to the ever-changing market conditions much faster.
Osmosis price currently sits at 0,921944 USD. The price seems to have stabilized at around 1 USD for the last couple of months.
The all-time high is 11.21 USD, whereas the all-time low is 0.75 USD.
Its 24-hour trading volume of 26 638 043 USD.
The current market cap is 454 141 011 USD.
There are 492 590 761 OSMO currently in circulation.
The Osmosis team is working on a lot of new features. Volatility awareness and bridges are the first that come to mind.
Osmosis Telegram - https://t.me/osmosis_chat
Osmosis Reddit - https://www.reddit.com/r/OsmosisLab/
Osmosis Discord - https://discord.com/invite/osmosis
Osmosis Medium - https://medium.com/osmosis
Osmosis Twitter - https://twitter.com/osmosiszone
Osmosis GitHub - https://github.com/osmosis-labs/osmosis
Osmosis crypto is an automated market maker (AMM) for the Cosmos ecosystem, designed to allow users to set up their own custom liquidity pools.
Top 10 Altcoins other than Bitcoin to watch out for this year. Based on market cap, historical performance and market events.
Ethereum & Solana are prominent blockchains, each hosting native cryptocurrencies. Know more about differences in speed, transaction speed, scalability, fees