Cosmos’ ATOM token saw a 27-day consolidation period with little to no indicators for its trajectory. On April 2nd, a temporary bullish respite was briefly seen, sending ATOM’s price to a generous $32.80 USD ($43.79 AUD) up from $27.80 – before falling slightly to $30.75.
What can we expect from ATOM’s price going forward, what can we gather from the past month, and what exactly is ATOM?
Performance in 2022 so far
Cosmos (ATOM) endured a rather extended stagnation period since falling from its all-time high of $44.70 in January. Since then, ATOM’s price action has been rather restricted, trading sideways within a $5 price range for the most part. This squeeze worsened over the past three weeks, with entire week periods where trading was tightened to $3.
Analysts believed that $31 was the necessary confirmation required for Cosmos to break its consolidation and rise towards its upper trendline at $44. To the relief of many, this price point was reached on April 2nd, pushing past $31 and reaching $32.80. Contrary to predictions though, this was not enough for a proper breakout. Instead, the price fell back down to $30.75 in less than 24 hours. Given the ambiguity of ATOM, we can assume that many traders will be looking for a more definite confirmation (possibly $33, which the recent run was just short of) before entering any short or long positions.
Source: TradingView
While it’s difficult to say whether or not ATOM will reach this point, its recent respite least serves as a breather for those worrying that ATOM may fall below the $26 support level.
So what is Cosmos (ATOM)?
Cosmos is a decentralised ecosystem of blockchains designed for scalability and interoperability. Heralded as the “internet of blockchains”, Cosmos aims to foster collaboration between blockchains by allowing them to communicate, and transact with each other in a decentralised way.
Source: Cosmos.network
According to the official Cosmos website: “The vision of Cosmos is to make it easy for developers to build blockchains and break the barriers between blockchains by allowing them to transact with each other.”
“The end goal is to create an Internet of Blockchains, a network of blockchains able to communicate with each other in a decentralised way. With Cosmos, blockchains can maintain sovereignty, process transactions quickly and communicate with other blockchains in the ecosystem, making it optimal for a variety of use cases.”
The native cryptocurrency token of Cosmos is ATOM, which has three use cases, as outlined on the official Cosmos FAQ:
- As a spam prevention mechanism, ATOM are used to pay fees. The fee may be proportional to the amount of computation required by the transaction, similar to Ethereum’s concept of “gas”. Fee distribution is done in-protocol and a protocol specification is described here.
- As staking tokens, ATOM can be “bonded” in order to earn block rewards. The economic security of the Cosmos Hub is a function of the amount of ATOM staked. The more ATOM that are collateralized, the more “skin” there is at stake and the higher the cost of attacking the network. Thus, the more ATOM there are bonded, the greater the economic security of the network.
- ATOM holders may govern the Cosmos Hub by voting on proposals with their staked ATOM.
- If you want to invest in ATOM token, we highly recommend CoinSpot. This Australia-based exchange is renowned for its competitive fees, 24/7 customer support and excellent secuirty features. You can refer to our CoinSpot review to learn more about what it provides.
