Evmos and staking: a beginner’s guide
Evmos is relatively new to the Cosmos ecosystem. Introduced in September 2021 and launched in June 2022, it is one of the promising projects that has a unique and interoperable usecase: it is fully compatible with the Ethereum Virtual Machine.
But what exactly does it do? And how do I get started?
A brief introduction to Evmos
To get a better understanding of Evmos and its Ethereum Virtual Machine (EVM) compatibility, let’s have a look at Ethereum first. Ethereum is a global and decentralized computing platform. Just like a computer or laptop, but instead, it is run by thousands of machines all around the world. Ethereum is capable of deploying your own code and interact with applications created by friends, colleagues, and even strangers. If Bitcoin seeks to serve as digital gold, Ethereum has taken a different approach, generalizing so its users can create any number of custom assets and programs governing their operation. A commonly used (and slightly blunt) comparison is that Bitcoin is more like email, whereas Ethereum has more common with the web browser, enabling people to create things and having others interact with it.
Evmos is a proof-of-stake blockchain that is fully compatible and interoperable with Ethereum. It is its own Cosmos chain and the first of many EVM-compatible chains running in the Cosmos ecosystem. You can send regular Ethereum transactions to Evmos Chain and vice versa. Over the last few years, EVM has become the most widely adopted standard for smart contracts and is now found across several blockchains trying to replicate Ethereum’s success. By integrating the EVM mechanism, Evmos is attractive and appealing to Ethereum developers.
The interoperability between Ethereum-based applications and the Cosmos blockchain ecosystem (including Cosmos, Crypto.org Chain, Osmosis and many more) allows developers to build with Ethereum’s desired capabilities in a Tendermint environment. As a result, users and their assets across the Cosmos ecosystem can access the utility in Ethereum. A powerful combination of two worlds that weren’t able to communicate before.
The $EVMOS token
The native Evmos blockchain token ($EVMOS) has several functions. It is used as a management token, as incentives for using applications on Evmos; to pay gas fees, and to reward developers and network operators for their services via the built-in revenue sharing model (dApp store). EVMOS is also required to perform token registration in the ERC-20 module to integrate EVM-IBC with ERC-20, like written above.
Unlike with many other blockchain tokens, there was no presale or pre-mining of the Evmos token. The initial genesis offering was 200 million, with a total offering of 1 billion. EVMOS tokens were distributed in what is known as a “Rektdrop”: a genesis airdrop for longtime supporters as well as for victims who got “rekt” (i.e., “wrecked”) on Ethereum. The tokens were distributed largely among users of Ethereum’s most popular applications, such as Aave, Olympus, as well as users of the Cosmos ecosystem.
The initial token distribution is as follows:
Staking rewards: 40%
Team vesting: 25%
Usage incentives: 25%
Community pool (DAO treasury): 10%
Using Keplr Wallet & MetaMask
To get started, you can access the Evmos app here. If you want to use the Assets Page, you’ll need to use both MetaMask and Keplr. Both are secure and widely used crypto wallets you can use as a browser extension in pretty much any browser available. The MetaMask wallet supports Ethereum (also known as ETH or ERC-20), whereas the Keplr wallet supports Cosmos’ IBC token standard. You will need both to send transactions from one to the other.
How to deposit and withdraw
You can use Deposit and Withdraw from the Assets Page to send IBC Coins between Evmos and another Cosmos chain via IBC Transfer.
Transfer an IBC coin from its native chain to Evmos
Step 1. Connect to the Evmos dashboard with your KEPLR wallet
Step 2. Find the asset you want to deposit on the Assets Page and click DEPOSIT
Step 3. Fill in your MetaMask address with the GET ADDRESS button. “This is done automatically”
Step 4. Confirm the amount to send tx in metamask to x-chain deposit in to keplr.
Step 5. Disconnect Keplr and connect MetaMask to see your deposited tokens under IBC BALANCE
Transfer an IBC coin from Evmos to its native chain
Step 1. Connect to the Evmos dashboard with your METAMASK or KEPLR wallet
Step 2. Find the asset you want to withdraw on the Assets Page and click WITHDRAW
Step 3. Fill in your Keplr address with the GET ADDRESS button
Step 4. Switch networks in Keplr to see your updated balance for the chain you withdrew to
How to convert tokens
Convert an IBC Coin to an ERC-20 Token on Evmos
Step 1. Connect to the Evmos dashboard with your METAMASK wallet
Step 2. Find the asset you want to convert on the Assets Page and click CONVERT
Step 3. Select IBC and input the amount to be converted to ERC-20 Tokens(Note: CONVERT can only be used with MetaMask)Convert an ERC-20 Token to an IBC Coin on Evmos
Step 1. Connect to the Evmos dashboard with your METAMASK wallet
Step 2. Find the asset you want to convert on Assets Page and click CONVERT
Step 3. Select ERC-20 and input the amount to be converted to IBC Coins
(Note: CONVERT can only be used with MetaMask)
Staking Evmos
EVMOS is used to pay fees and — just like other proof-of-stake chains — to secure the network through staking. In addition, Evmos is used by the community to decide future governance decisions. It is the first token on an EVM chain that drives governance outcomes. As a EVMOS holder or staker, you can make governance proposals, vote on them, and help decide the course of the project together with the community.
That’s great! But how do I get started?
Just like any other Cosmos blockchain, it is very easy to stake Evmos using Keplr wallet.
Step 1. Open Keplr wallet in your browser extension by clicking on the Keplr logo.
Step 2. Select the blockchain dropdown menu, scroll down and select Evmos.
Step 3. You now see your Evmos balance. Click on Stake. This will redirect you to Keplr’s staking page. Here you will see a list of active validators, including ChainTools.
Step 4. Click the Manage button and select Delegate. Here you can enter the amount of Evmos you want to stake. Then, click Delegate again. This will open a pop-up from your Keplr wallet browser extension.
Step 5. If everything is filled in correctly and you want to proceed, hit the Approve button.
Step 6. That’s it! You are now successfully staking Evmos.
The EVMOS team, ecosystem and partners
The core developers of Evmos are the Tharsis Labs team, which has extensive experience in distributed systems and blockchains. The team is led by Federico Kunze Kullmer, a full-time Cosmos contributor since 2017, and Akash Khosla, who was previously a software engineer at Anchorage, a digital asset custodian and bank. Federico used to work on Peggy (formerly Gravity Bridge), Cosmos SDK, and IBC. Both founders have focused on growing the crypto community organically from the very beginning, making blockchain at Berkeley University one of the most prominent university organizations.
The Evmos ecosystem currently includes DeFi, protocols, wallets, NFTs, and various tools. Decentralized exchanges (DEXes) built on the Evmos network include Uniswap V2 forks Diffusion Finance and Exswap, stableswap exchange Kinesis Labs, cross-chain protocol SpaceFi, and others.
Evmos has an extensive infrastructure, including bridges such as Celer and Nomad, UMA oracle, and decentralized storage solution YVE. Because Evmos is EVM-compatible, Ethereum infrastructure projects and tools can be easily used and scaled to Evmos.
There are also several NFT projects running on Evmos, such as tofuNFT and Orbital Apes. The full list of Evmos’ ecosystem components can be found here.
Evmos and the Cosmos ecosystem
As the first IBC-enabled EVM, the impact on the Cosmos ecosystem is huge. Because this introduces decentralized interoperability between Ethereum-based applications and the Cosmos ecosystem, it will allow benefits of EVM architecture to be coupled with the benefits that Cosmos ecosystem chains have to offer. So that’s a win-win! A bridge between mainnet Ethereum and Evmos will make the two blockchains interoperable, in turn connecting mainnet Ethereum to all IBC-enables Cosmos ecosystem chains. Evmos has very low transaction costs and low transaction times (thanks to Tendermint, Cosmos’ consensus mechanism), something that is very much appreciated by both users and developers.
Developers that already use Ethereum can now build on Evmos in the same way as they would on Ethereum, but with the possibility to add new features only possible within the Cosmos ecosystem. That’s a huge plus.
It’s also possible for existing EVM-compatible projects to be launched on Evmos, including blue-chip DeFi protocols such as Uniswap, and money markets protocol Aave. This will bring liquidity over to the chain, which might make its way further into the Cosmos ecosystem.
Awesome. Are there any dApps to look forward to?
For sure! Here is a small list of most used dApps on Evmos.
Aave V3
Aave is a decentralized open-source liquidity protocol. The platform enables users to lend and borrow cryptocurrency assets from liquidity pools to receive rewards in return. Aave is non-custodial, meaning it doesn’t hold cryptocurrencies and users have full control over their funds. Initially built on Ethereum, Aave quickly became the biggest and most popular modern money market platform, pioneering the space with some essential innovations. At the point of more than $15 billion in total value locked, the platform has expanded its markets on Polygon and Avalanche networks.
Initial supported assets are USDC, USDT, DAI, AAVE, WBTC, WETH, OSMO, EVMOS and ATOM among many others. Aave V3 on Evmos is the most used money market platform right now.
Frax Finance
Frax Finance is a fractional-algorithmic stablecoin protocol, which means that the digital asset is partially backed by collateral and partially stabilized algorithmically. The company aims to provide highly scalable, decentralized, algorithmic money which would replace fixed-supply digital assets like BTC.
The name of the Frax Finance stablecoin FRAX is derived from the fractional-algorithmic stability mechanism, whose ratio of collateralization and algorithmic strategy depends on the market’s pricing of the stablecoin. Generally, if the token is trading above $1 the protocol automatically decreases the collateral’s amount, while if it gets under $1 the protocol increases it.
The protocol uses Uniswap and Chainlink’s price oracles. Currently, the stablecoin is pegged to USD, however, the main aspiration of the team is to build a crypto native version of the Consumer Price Index (CPI) which would be governed by FXS and other protocol’s token holders and would be called Frax Finance Price Index (FPI). The team believes that in this way FPI will become “the first decentralized, permissionless native unit of account which holds the standard of living stable”.
UMA
Universal Market Access (UMA) is an Optimistic Oracle (OO) that serves data to smart contracts. Upon a price request, anyone can push an answer on-chain. The system works “optimistically”, meaning that the dispute can be raised only if someone considers the data to be wrong.
The Optimistic Oracle became live in May 2021. Initially launched as a platform that allowed anyone to create synthetic tokens, UMA evolved into a system which can bring all types of data on-chain.
The UMA protocol was established by the Risk Labs foundation. Founded in 2017, it raised $4 million from companies such as Bain Capital and Dragonfly Capital, and in December 2018 the UMA project white paper was unveiled. A few days later, the developers announced an official launch of the UMA project and introduced the USStocks token as the first product for the core network. UMA held an ICO in April 2021, which was notable for being the first ever initial offering of a decentralized exchange on Uniswap.
