barry

Today, @cosmos and @interchain_io contributed @IBCProtocol to the Linux Foundation Decentralized Trust with support from @WellsFargo, @googlecloud, @Figure, @OpenZeppelin, and more than a dozen other leaders in security, developer tooling, and financial services. IBC is an open source blockchain and asset interoperability solution that has processed over $50b of transfers between 200+ ledgers, since it was developed in 2021. It is one of the first, most trusted, and battle-test interoperability solutions out there. Blockchain interoperability has never been more important. Almost every payment network, securities depository, central bank, and global commercial bank in the world has begun developing its own ledger and/or deploying assets across numerous public ledgers. Tokenization depends on getting interoperability right. IBC makes different tradeoffs than other interoperability solutions. It is built to prioritize security and sovereignty over everything else. IBC prioritizes sovereignty because interoperability solutions derive their value from the asset issuers, networks, and businesses that use them, not the protocol itself. Governments, large enterprises, and financial institutions know this. It’s why Circle, Tether, and the largest issuers all have their own solutions. This is why IBC is fully permissionless, open source, standards-based, and doesn’t depend on a token, validator set, or central network anywhere. This enables institutions and businesses to build on it, use it, and extend it for their uses without worrying about long-term vendor lock-in, hidden dependencies, dormant fee switches, or isolation from the liquidity and counterparties they need to scale their businesses. They can connect to anything on their own terms. IBC prioritizes security because hackers armed with frontier AI pose the biggest threat to bringing the world’s finances to more digitally-native, programmable, and open systems. This is why IBC supports direct, cryptographic verification of messages, instead of relying primarily on trusted signers that attackers can infiltrate and undermine. Going back to sovereignty, enterprises can supplement this with trusted signers operated by whomever they choose. Ultimately, making interoperability work across the global financial system will require much broader industry participation than we can muster directly. By bringing IBC under LF Decentralized Trust's neutral governance, we're creating an opportunity for financial institutions, technology providers, and developers to collaborate on shared interoperability standards that anyone can use and no one can own. We’ve already seen developers beginning to contribute new integrations and applications, like support for @zksync, @StellarOrg, a new ZK-based Besu integration, ERC-3643. This is just the beginning. Cosmos will continue contributing to IBC, but we won't be alone in doing that anymore. We're already joined by OpenZeppelin and @datachain_en in governing and maintaining the protocol I look forward to expanding on the accomplishments of the companies and developers who have made IBC wha it is today, and working with more organizations to make financial assets truly interoperable. Read more about this initiative:

The agentic payment people are having their intents galaxy brain moment just like the crypto people did 3 years ago lol

Important to remember that Will is a performance artist

The big crypto × AI prediction is that agents will pay with stablecoin wallets. But agentic payments are mostly online shopping, and credit cards already work. The real threat to banks is the agent-native markets that don’t exist yet.

A lot of people are analyzing the Visa acquisition of fireblocks as a defensive move: “Payments are moving to stablecoins away from cards” This is wrong. Stablecoin payment volume is stalled and quite low Settlement IS moving to stablecoins. Stablecoin-backed cards are ripping and bringing unbanked / underbanked populations onto card networks. This is the single biggest growth opportunity visa has for the core card networks And it’s the first time they aren’t going to be reliant on banks for expansion, and they are going to lean in hard here.

Reality check for CT: Bank executives at the Nacha payment conference overwhelmingly rate banking core modernization NOT stablecoins, tokenized deposits, or RWAs as the most significant impact blockchain technology will have on their industry over the next 5 years

Since researchers are increasingly concerned about the security of elliptic curve cryptography, this couldn't come soon enough. Post-quantum user accounts and block production, along with a migration path that enables existing IBC connections to continue working.

Dario complaining that AI research is progressing dangerously fast:

This chart is a big driver behind how we’re trying to re-invent Cosmos and why it’s so challenging. Cosmos was all about the blue box — developers launching blockchains because that’s where the money was. We’re focused on building full-stack solutions for tokenization for financial institutions now. Cosmos and IBC under the hood, but that’s an implementation detail from the customer perspective

In the time since I wrote this, the company was acquired by Sierra lol

A few thoughts on the dYdX news. dYdX proved you could run a serious exchange fully on-chain, and that moved the whole space forward. But the reality is that they have been struggling for a while, navigating the rise of a new generation of perps competitors (Hyperliquid, Lighter), a general decline/consolidation in defi, and the emergence of web 2.5 threats (Kalshi, Meta soon?). We’ve been navigating a lot of similar pressures. So going after RWAs with a partner that owns distribution like Robinhood is a sane bet to turn things around, and I hope it pays off. Regarding the effect on ATOM, there’s not much here. dYdX Chain was always sovereign. It used the Cosmos stack, but its fees, security, and value accrual don’t move the needle for ATOM. The ATOM community didn’t pay for dYdX to migrate to Cosmos in the first place. So this move doesn't hurt it. The message for our team is clear though and aligned with what we’re already doing: Double down on ATOM and the Hub ecosystem. Ultimately, that’s why we acquired the team behind Mintscan. We wanted to bring their infrastructure expertise to the Hub, so we could start doing more for ATOM while continuing to chase new institutional markets for the Cosmos stack. For the Cosmos stack itself, this is more evidence for our thesis that owning the platform is a move that makes for teams that own distribution and have a market-leading product (like Robinhood). Figure, Ondo, Injective, global banks like Wells, central banks, and banking consortiums. We’re laser-focused on building new solutions for issuing and using tokenized deposits for banks, based on what we’re learning from banks building on Cosmos and with other stacks today. This is what we’re going after and dYdX’s announcement changes nothing for us there.

My deepest sympathies for the affected users who lost funds in the Axelar <> Secret exploit. Both teams have published their post mortems, and as the lead maintainer of IBC, I will clarify some questions we have been receiving from users and teams who use IBC. -- First, the IBC core and ICS20 (IBC's lock-and-mint token standard) have not been exploited. This means that if your company or team uses IBC core or ICS20, this exploit does not affect you. -- The exploited contract was uniquely deployed on Secret to facilitate communication between Axelar and Secret. It is not an upstream component of IBC or Axelar. -- The exploited contract was IBC-enabled (ie it ingested messages produced by IBC core and reacted to them). It appears to be a fork of a contract typically used to convert between ICS20 tokens and CW20 tokens. -- The contract had been modified to enable the Axelar network to mint/burn SNIP20 tokens (Secret's unique private token standard) via IBC. -- The modifications to the contract included the deletion of a safety check that enabled the attack to mint unbacked tokens by sending messages from another channel (ie not from Axelar) -- In the official ICS-20 protocol specification and implementation, this is not possible because each token denomination can only be minted by messages received over a specific channel associated with the token. I would like to reiterate that the situation is extremely unfortunate and difficult for affected users and the teams maintaining Secret and Axelar. We have been in touch with both teams and are working with them to support affected users. Post mortems: 1. Secret: forum.scrt.network/t/securit… 2. Axelar: commonprefix.com/blog/secret…

Aakash and Spencer are some of the most brilliant builders I know and this memo deserves a ton more attention than it's gotten (I have no stake in their startup)

I've spent the better part of a year arguing that Cosmos is the right place for institutional finance and public DeFi to collide. Today we're putting new resources behind that. Cosmos Labs is acquiring Mintscan and welcoming 15+ new team members from Mintscan into our Ecosystem unit, operating as Cosmos Labs Korea Co., Ltd. I want to take a moment to say what this actually means to me beyond what the blog post covers. 1/ I’m thrilled to work with the team. Una Yu (“Grace”), Yongjoo Jung, and the other leaders are die-hard supporters of our technology, values, and ecosystem. They have been running critical infrastructure across 150+ Cosmos blockchains under real operational pressure at production scale for 8 years. Bringing them in means inheriting years of hard-won operational knowledge and a team that already knows and loves the ecosystem and its users. 2/ I’m excited that Cosmos finally has an on-the-ground presence in Korea. Korea is where Cosmos achieved its earliest and deepest network effects. It is also, right now, one of the fastest-moving markets in the world for tokenization and institutional crypto adoption. Having the CLK team there feels like Cosmos is finally “coming home” and changes the conversations we can have with enterprises in Asia. 3/ This gives us the resources to go after a bigger and more exciting vision for the Cosmos Hub as the crossroads for institutional finance and permissionless DeFi. There are already tens of billions of dollars of real-world assets tokenized across Cosmos ledgers from Injective, Figure, Ripple, and others. Almost every major player in capital markets, banking, and payments is racing to launch their own tokenization engine too. We have an opportunity to create products and markets that connect all of these and allow value to flow across them. It’s never been a better time to bet on interoperability. Excited to build with this team.

The @CronosApp team has massively pushed what a Cosmos chain is capable of -- 10k TPS proven in production The upcoming release upstreams many of their improvements and adds more to massively increase baseline and best case Cosmos performance