Cosmos ($ATOM) was once seen as one of crypto’s most promising projects. It launched with a big vision – to become the “internet of blockchains.” But over the past few years, it’s lost momentum. Now, the token is down nearly 90% from its highs, and the project looks like it’s struggling to survive.
So, what went wrong – and is there still hope for ATOM? Analyst Nonzee shared a detailed thread about this via X.
What you'll learn 👉
The Rise: Cosmos Launches With Big Hopes
Back in 2017, Cosmos raised over $17 million in BTC and ETH during its initial coin offering (ICO). By 2019, it had launched the Cosmos Hub and its ATOM token. The technology looked cutting-edge – it introduced IBC (Inter-Blockchain Communication) and Tendermint BFT, helping to pioneer cross-chain transactions.
1/ 2017-2019 – The Dream
— Nonzee (@0xNonceSense) July 1, 2025
Cosmos launched with big promises.
In 2017, the Interchain Foundation raised ~$17M (4,882.7 $BTC and 246,891 $ETH) in minutes to build the “internet of blockchains”.
By 2019, Cosmos Hub (with its $ATOM token) was live, pioneering cross-chain tech… pic.twitter.com/EvQZthwJzH
The early years were full of promise. Cosmos aimed to be the infrastructure layer for blockchain interoperability. But as time went on, cracks began to show.
In 2020, things started to go wrong behind the scenes. The core team at Tendermint began fighting. Founder Jae Kwon stepped down to focus on a side project, and key developers like Zaki Manian left entirely. The company that originally raised the funds, All in Bits, held onto the money, but the development team splintered.
Without a united leadership, Cosmos Hub began to drift.
Read also: How High Could XRP Price Go If Ripple Matched Bitcoin’s Market Cap?
ATOM Misses the DeFi Boom
While Cosmos technology continued to power new chains like Osmosis and Terra, the ATOM token didn’t benefit much. Other chains launched their own tokens, built communities, and captured attention. Cosmos Hub – the chain ATOM is tied to – was often overlooked.
Even when Cosmos launched IBC in 2021, which allowed chains to talk to each other, ATOM’s utility remained basic. You could stake it and vote, but not much more.
In 2022, developers proposed a bold upgrade called ATOM 2.0. It aimed to change tokenomics, cut inflation, and give ATOM more utility – like being used as preferred collateral in the ecosystem. But the community wasn’t convinced. They voted against it.
That vote killed off one of Cosmos’s best chances to fix its problems. As insiders called it, this was the project’s “second death.”
Community Splits and Price Collapse
By 2023, ATOM’s price had fallen hard. While other coins like Solana rebounded during the new bull market, ATOM kept dropping. It dipped below $5 – a brutal fall from its former highs.
Even worse, Jae Kwon returned to the spotlight not to help rebuild Cosmos, but to propose a complete fork of the chain called AtomOne. This move deepened the divide in the community. Instead of uniting around solutions, it looked like Cosmos was being pulled apart.
One proposal to cap inflation passed, reducing staking rewards. Kwon publicly opposed it, saying Cosmos had lost its way. That further hurt confidence.
Read also: Best Solana Meme Coins to Buy as SOL ETFs Look ‘Ready to Launch’
Cosmos Hub Today: Is It Too Late?
Right now, Cosmos feels like a ghost town. The market cap is still in the billions, but there’s little developer activity on the Hub. ATOM remains highly inflationary, with few ways to use it besides staking. The energy that once made Cosmos special is fading.
But it’s not dead yet.
How to Save ATOM: Three Key Fixes
Analyst Nonzee laid out three steps that could help bring Cosmos back from the edge:
1. Fix Tokenomics
ATOM needs better economics. Inflation is still around 10%, which creates constant sell pressure. Reducing this to 2–4% (like Ethereum) would help stabilize the token. At the same time, Cosmos should build real value accrual into ATOM – give people a reason to hold it.
7.1/ Fix Tokenomics
— Nonzee (@0xNonceSense) July 1, 2025
Drastically reduce inflation and create real value accrual for $ATOM.
High inflation (which even after the cut is ~10%) puts constant sell pressure on $ATOM.
Aim for Ethereum-like low inflation (2–4% target) to curb dilution.
In parallel, give $ATOM… pic.twitter.com/jnxWTqkXgf
2. Boost Utility
Today, there’s not much to do with ATOM besides stake and vote. That must change. Enabling smart contracts on the Cosmos Hub (like CosmWasm) could attract developers and dApps. If ATOM becomes useful within those apps, demand would follow.
3. Unified Leadership and Clear Vision
The biggest problem might be the lack of leadership. The infighting and founder drama have fractured the community. Cosmos needs a trusted team or council that can execute a shared roadmap. Without that, it risks losing whatever momentum is left.
Wrapping Up
Cosmos was never short on innovation – but ideas alone don’t build a thriving crypto ecosystem. What Cosmos needs now is focus, coordination, and urgency. There’s still a loyal community, and the tech remains relevant. But time is running out.
Whether Cosmos can be saved depends on the decisions made in the next year. If those go wrong, ATOM may not recover. But if done right, this project could still write a comeback story.
Subscribe to our YouTube channel for daily crypto updates, market insights, and expert analysis.
