ATOM rallied by up to 36 percent on a week-to-date timeframe as traders assessed the prospects of a major technological update on its parent blockchain Cosmos on February 18.
Dubbed as “Stargate,” the upgrade would enable Cosmos-based chains to connect using the first standardized protocol for inter-blockchain communication. With that said, chains will securely and trustlessly exchange data and token value with each other, making Cosmos the first global public ledger to achieve the mettle.
The Stargate upgrade would also introduce “Protobuf Migration” that aims to accelerate front-end development by including more transactions in Cosmos blocks, reducing gas fees, and supporting multiple programming languages.
“We expect [the] transaction throughput of the Cosmos Hub (and others that upgrade) to increase by 10x to 100x,” read the project’s official website. “This will be very important for the Cosmos Hub to handle an ever-increasing volume of cross-chain transactions. It also makes it easier on the nodes that run the network.”
Traders flocked into the ATOM market on Tuesday, anticipating that the euphoria around the Stargate upgrade would boost the cryptocurrency’s adoption among technologists and speculators alike. The cost to purchase one ATOM reached a new all-time high above $26 on Binance, up 36 percent this week and 220 percent in February.
Cosmos settles a new record peak ahead of the Stargate launch. Source: ATOMUSD on TradingView.com
Part of the reason is ATOM’s crucial role in running the Cosmos network.
It works as a settlement token for people who stake their assets in Cosmos liquidity pools. Meanwhile, holding it also gives them the right to introduce new proposals or vote to make fruitful changes to the Cosmos protocol. ATOM holders also benefit from the fees Cosomos generate by allowing transactions through its…