DeFi Differences Between Cosmos, Ethereum, Polkadot, and Wanchain?
By: Huobi Global
Tags: Ethereum, Wanchain, Polkadot, Defi, Atom

What are the key differences between Cosmos, Ethereum, Polkadot, and Wanchain blockchains?

Let’s find out by going through each one and let you make your own assumptions on which one is better based on facts.

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1. What is Cosmos Network?

Cosmos was created in 2016 by Founders Billy Rennekamp, Ethan Buchman and Jae Kwon. Cosmos raised over $16 million in an initial coin offering (ICO) in 2017. Cosmos is a network made up of many independent blockchains which utilize byzantine fault tolerant (BFT) consensus mechanisms, including Tendermint BFT. Each individual blockchain maintains control of its own governance, but is interoperable with other blockchains in the network. Blockchains that do not utilize BFT algorithms can be connected to the Cosmos network via “adaptor” blockchains. Cosmos was not designed for one particular use case, but to be adaptable to suit many different use cases.

Cosmos has two types of blockchains: Zones and hubs. Zones are regular blockchains, while hubs are blockchains that connect zones with one another. The Cosmos Hub was the first blockchain (and hub) to be launched in the Cosmos ecosystem. It is a public, proof-of-stake (PoS) blockchain whose native asset is the atom (ATOM).

What is ATOM?

ATOM is the staking coin that is mainly used for governance. By staking ATOM, the zone validators can join the hubs, with an option to have their stake reduced by misbehaving in their zones. The current annual yield on ATOM is around 6.5 %.

🔹Trade ATOM

2. What is Polkadot?

Polkadot was founded in 2016 by Gavin Wood, former Co-Founder and CTO of Ethereum. Polkadot raised more than $145 million via a token sale in October 2017. Soon after, though, it had ethereum (eth) tokens to the value of $98 million frozen due to a bug in Parity wallets.

Polkadot unites a network of heterogeneous blockchains called parachains and parathreads. These chains connect to and are secured by the Polkadot Relay Chain. They can also connect with external networks via bridges. With Polkadot you can create a custom blockchain in minutes using the Substrate framework. Connect your chain to Polkadot and get interoperability and security from day one. Chains remain independent in their governance but united in their security.

Why Polkadot?

Polkadot builds on the revolutionary promise of previous blockchain networks while offering several fundamental advantages.

Blockchains in isolation can only process a limited amount of traffic. Polkadot is a sharded multichain network, meaning it can process many transactions on several chains in parallel, eliminating the bottlenecks that occurred on legacy networks that processed transactions one-by-one. Think of a single lane road to a road with multiple lanes. This parallel processing power significantly improves scalability and creates the right conditions for increased adoption and future growth. Sharded chains connected to Polkadot are called “parachains” because they run on the network in parallel.

What is DOT token?

DOT is the token native to Polkadot. DOTs serve four key functions in Polkadot, Governance over the network, staking, bonding, and fees.

🔹Trade DOT

3. What is Ethereum 1.0?

Ethereum was created in 2015 by Vitalik Buterin, Charles Hoskinson, Mihai Alise, Amir Chetrit, Joseph Lubin, Gavin Wood, and Jeffrey Wilke. Ethereum is a decentralized open-source blockchain featuring smart contract functionality. Ethereum revolutionized the crypto-space by bringing in smart contracts on the blockchain. Smart contracts help you exchange money, property, shares, or anything of value in a transparent, conflict-free way while avoiding the services of a middleman.

Ethereum as of right now is using Proof-of-Work (POW). In a PoW system, miners, who use various types of computer hardware like computer processors, graphics cards, and specialized mining devices, use their processing power to solve complex mathematical puzzles in a race to verify new network transactions. By being the first to solve a given puzzle, a miner adds new transactions (which together form a “block”) to the record of all transactions (the “blockchain”). For their efforts, they are rewarded in newly minted crypto like ETH.

What is Eth token 1.0?

Ethereum applications and contracts are powered by eth, the Ethereum network’s currency. Eth is used broadly for two purposes: it is traded as a digital currency exchange like other cryptocurrencies, and it is used inside Ethereum to run applications and even to monetize work.

What is Ethereum 2.0?

Ethereum 2.0 will replace the current Proof of Work (mining) model that the blockchain uses with staking. There are two primary improvements introduced by Ethereum 2.0 that do not exist in Ethereum 1.0: Proof of Stake and Shard Chains.It will likely take many years for the Ethereum 2.0 upgrade — in all its complexity — to be complete. Phase 0 of Ethereum 2.0 will launch in 2020. Phase 1 is anticipated in 2021. Phase 2 and beyond are anticipated for 2021 or later.

What is Eth token 2.0?

ETH2 will be governed by Proof-of-Stake consensus. 32 ETH is required for staking and earning rewards on the Ethereum 2.0 network. Individuals who are not able to stake the full 32 ETH can also choose to do so in a group with others to make up the total staking fee

The rate of return for staking ETH is expected to be 4% — 10 %.

🔹Trade ETH

4. What is Wanchain?

Wanchain was created in 2017 as a non-profit public blockchain project initiated by Jack Lu, the co-founder, and CTO of Factom. Wanchain is now a Proof of Stake blockchain implementing its own version of Cardano’s Ouroboros consensus mechanism called Galaxy POS. It provides smart contracts, cross-chain transactions, and ring signature-based private transactions designed for decentralized financial applications. Wanchain’s founding vision is to make Cross-Chain DeFi a reality by allowing assets to flow freely between blockchains without any centralized third party limiting their movement.

What is WAN Coin?

WAN is Wanchain’s native token. All Wanchain transactions, cross-chain transactions, and smart contracts are powered by WAN. WAN is used as a stake in Wanchain’s Galaxy Proof of Stake system, and also serves as a bond for Wanchain’s cross-chain wanSM “Storeman” nodes. Investors can earn passive income by staking WAN either to validators or to Storeman nodes. The current annual yield for WAN validators is around 9% while wanSM delegation is expected to begin in Q4.

What is one project built on Wanchain?

FinNexus (FNX) — FinNexus is a DeFi focused project which recently went live on Wanchain. FinNexus is building a suite of open finance protocols to power hybrid marketplaces that trade both decentralized and traditional financial products across multiple public blockchains. The first FNX platform is a decentralized options protocol powered by a single liquidity pool on both Wanchain and Ethereum.

🔹Trade WAN

Overview:

Now you can see how each protocol is unique within the defi ecosystem.

🔹Did you miss DeFi Dash — Part 1? Read it here.

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