The only reason why the Cosmos hub launched before IBC was ready, was because a strong validator set was needed. Let’s not forget that Cosmos hub is supposed to be a central super safe hub in the Cosmos ecosystem. If the Cosmos hub is compromised that would affect the entire ecosystem having catastrophic consequences. Furthermore, in Cosmos the voting power is proportional to the amount of stake, and while in theory validators only vote if their delegators don’t vote, in practice delegators rarely vote meaning that a high stake provides huge power: both in proposing blocks and earning the block proposer bonus as well as in governance.
Let’s also not forget something that is crucially important. If 1/3 of the stake is offline (by accident or by an attacker) a hard fork will be needed because it would not be possible to readjust the validator set or fix this since the chain is halted and no transactions are possible. Hence, the limit before something catastrophic happens to Cosmos damaging its reputation irreparably, is 1/3 of the bonded stake.
Now, listen up to this: basically this 1/3 is controlled by 5 validators. One is Polychain, just staking their own atoms. Another is bitfish, which is F2Pool, one of the biggest Bitcoin and Ethereum mining pool. Then it is Sikka, a tendermint employee with 0% commission. Also, with 0% commission, Sparkpool another mining pool. The fifth is Dokia Capital, another atom whale.
Let’s analyse this: 2 atom whales, 2 top Bitcoin/Ethereum mining pools and one tendermint employee basically control 1/3 of the bonded stake (33.22%) as of today 08.09.2019. So these 5 could at any second decide to stop Cosmos hub forcing the whole network to require a hard fork. People complain about a few mining pools controlling bitcoin, but at least 51% of hashrate is needed to cause problems, not 1/3 of hashrate. Furthermore, any attack will be hard to sustain beyond a few blocks. In the case of Cosmos, these 5 validators can halt the network indefinitely until a hard fork is coordinated.
Do you like this? I don’t and I think many people also don’t like it and it may be one of the causes of the recent drop in the atom price.
So it seems crucially important and very urgent that all atom holders start to take this seriously instead of earning a few more atoms by delegating to 0% commission validators. Does it matter to pay 0% commission instead of 10% if by delegating to 0% commission validators and centralizing the stake you are pushing the atom price to 0? It is very urgent and important that atom holders diversify their atoms among many validators and especially not to those with the most stake. If this is not done soon, the atom price is likely to keep going down and IBC won’t fix this because who would want to interact and interoperate with the Cosmos hub if the stake is centralized?
I encourage urgently all atom holders to support smaller validators. There are two scenarios really. Atom holders keep delegating to 0% commission validators (including exchanges coming very soon) and the stake gets so centralized that atom price drop to near 0 and people will use another hub properly decentralized. The second scenario is that you do all you can to spread your atoms and decentralize the stake, and then this together with IBC will lead atom to a new all time high.
I encourage you to spread your atoms and support as many validators as possible, here I will tell you why Cosmic validator should be also among your diversification set of validators.
- First of all, we haven’t missed a single block so far with perfect uptime and we have received delegations from the Interchain Foundation (ICF), a top 15 validator and Meher who is co-founder of Epicenter and Chorus One
- We are not an atom whale, and we are planning to stake all our rewards to our validator initially to align interests
- We are not an exchange or a mining pool running a validator
- We are not a tendermint employee or affiliated with AiB/ICF
- We don’t charge high fees like 20% or even higher, we stay at the average of 10% and we won’t raise the commission
- We don’t put 0% fee like many others to attract more delegation quickly hurting Cosmos and accelerating the race to the bottom of fees
- While we got some delegation from ICF, we are not like many other validators that have like 95%+ delegation only from ICF or AiB
- Finally, as long term community members and supporters here is a brief summarize of some of the things we have been doing to support Cosmos and make it what it is now:
-Discussing DEX use case in Cosmos included in a CoinTelegraph article: https://cointelegraph.com/news/malta-determined-to-become-the-blockchain-island-regulations-adoption-binance-headquarters
-Included mention of Cosmos in comparison table with TON: https://cointelegraph.com/news/telegram-digital-resistance-the-open-network-and-russias-ban
-Explained the potential of a DEX in Cosmos to CZ of Binance in WeChat last August 2018: https://medium.com/@hector_89360/explained-the-potential-of-a-dex-in-cosmos-to-cz-in-wechat-last-august-2018-fb543cbe5435
-CZ of Binance retweeted two tweets mentioning Cosmos after I discussed with him in WeChat and Twitter
-Helped explaining the potential of Cosmos/Tendermint to several projects building in Ethereum
-Tried to launch a PwC Cosmos hub validator while I was working there in partnership with Certus One and it wasn’t possible finally due to the internal risk controls at PwC
-While at PwC I pitched the advantages of Cosmos to the head of the blockchain lab, to several top partners, clients and a candidate to the government of Paris
-Since early 2018 I have been helping in the different Cosmos community channels with technical questions and doubts about Tendermint and Cosmos. I have also been pitching Cosmos in linkedIn, to journalists, in conferences and basically any time or anywhere I had the chance
-Article about the security of the Cosmos hub: I shared this article with Jae Kwon via telegram and he liked it and told me a few suggestions to improve it: “Why Cosmos and Polkadot are more secure, and hence more valuable, than the Bitcoin or Ethereum blockchains”, link: https://medium.com/@hector_89360/why-cosmos-is-much-more-secure-than-the-bitcoin-or-ethereum-blockchains-31f7aa2a1c7"
-I identified a 100% commission validator that was receiving most of its delegation from the ICF. After calling them by phone and reading their website I thought that the ICF should redelegate from them. I wrote an article (https://medium.com/@hector_89360/a-decentralized-army-the-cosmos-hub-staking-defenders-f7c69ca3a16f) and I explained this in the community channels and some people asked me to stop, etc. I decided to continue and after discussing with Forbole, they created a poll in twitter that made it clear the community agreed with me and others and this led to the ICF deciding to take validator commission into account for the next delegations
-I joined the Decentralized Staking Defenders forum and I have been participating in discussions about how to improve the decentralization of the Cosmos hub validators and supporting smaller validators
Finally, I studied at Imperial College and HEC Paris and worked at the PwC Blockchain Lab and currently at a leading bank in their blockchain team. My co-founder runs one of the biggest crypto OTC groups and our engineer is very talented and experienced as proven with the perfect uptime so far since Cosmic validator joined the top 100 active set.
We have a fast growing telegram community so you are very welcome to join and ask any questions there: https://t.me/cosmicvalidator