Introduction
A group of decentralized finance (DeFi) protocols have collaborated in an effort to solve liquidity problems within the Cosmos ecosystem. This partnership involves cross-chain bridging protocol Wormhole, liquidity aggregator Swing, lending protocol Tashi, and Cosmos network Evmos.
Bridged Tokens for Evmos
According to statements from Wormhole, the protocol will register five new bridged tokens for use on Evmos: Tether (USDT), USD Coin (USDC), wrapped Ether (wETH), wrapped Bitcoin (wBTC), and Solana (SOL). The proposal has received near unanimous support, and the vote is set to conclude on September 24.
Swing Protocol Integration
Once the tokens are launched on Evmos, they will be integrated into the Swing protocol. This integration will enable users to send the tokens from any network supported by Swing, including BNB Chain, Polygon, Fantom, and others, to Evmos.
Enhancements for Tashi Users
Tashi, the lending protocol, will also implement Swing into its user interface. This will allow Tashi users to bridge the coins and deposit them as collateral with minimal effort. Users will then have the ability to take out loans using this collateral and perform various DeFi actions such as swapping coins, depositing them in liquidity pools, and more.
Pending Implementation
According to representatives from Swing and Tashi, the integrations are ready to go live and are awaiting the finalization of the Wormhole proposal. The proposal's vote is scheduled to end on September 24, indicating that the new liquidity system should go live shortly thereafter.
Addressing the Liquidity Crisis
In an interview with Cointelegraph, Tashi co-founders Lindsay Ironside and Kristine Boulton emphasized the need for this new liquidity system within the Cosmos ecosystem. Boulton stated that the current lack of liquidity has prevented users from utilizing the many opportunities within the ecosystem. The partnership with Wormhole, which operates on 29 different chains, presents an opportunity to address this crisis.
Ironside shared her own negative experience with liquidity on the Cosmos ecosystem when she attempted to swap USDC for Cosmos (ATOM) and send it to Evmos. She encountered difficulties due to the gas fee requirement and realized the urgency of addressing this issue for new users.
Swing CEO's Perspective
Swing CEO Viveik Vivekananthan also acknowledged the potential of the new system to resolve liquidity problems. He explained that Swing will convert a portion of the coins sent into the Evmos native coin, which will be used to cover the gas fee for making coin swaps. This will enable users to onboard into Evmos using any supported coin.
In the beginning, Swing will primarily bridge tokens from non-Cosmos networks into Evmos, but the team has plans to expand compatibility to include bridges between different Cosmos networks in the future.
Recent Developments in the Cosmos Ecosystem
The Cosmos community has been actively working to attract users by introducing new features. For example, Cosmos-based chain Noble launched a native version of the USDC stablecoin on March 28, and Cosmos Hub implemented liquid staking on September 13. However, the ecosystem faces competition from Optimism Superchain, which aims to build a network of interconnected blockchains with similar features to Cosmos.
