Layer by Layer: Cosmos Ecosystem Reacts to Market Uncertainty

The crypto industry has come under siege in recent weeks, marked by a host of aggressive enforcement actions announced by the U.S. Securities and Exchange Commission (SEC) in early June. With the stage set for an adversarial conflict between U.S. regulators and the world’s largest crypto exchanges, Binance and Coinbase, the fate of the industry is becoming increasingly uncertain. This uncertainty has extended beyond the crypto ecosystem’s most centralized entities to include Layer 1 (L1) networks and DeFi protocols as well, many of whose tokens the SEC declared outright as securities in its recent lawsuit against Coinbase. 

Today, we check in with the latest developments in the Cosmos ecosystem, where the SEC’s designation of the Cosmos Hub’s ATOM token as a security brings fresh challenges to the broad network of blockchains connected by the Inter-Blockchain Communication (IBC) protocol.