Cosmos (Atom) was one of the best performing cryptocurrencies shortly after it was listed on the Coinbase exchange. On a day-to-day basis, the coin gained over 14% shortly after it was listed on the exchange. It is currently trading at $4.43 according to CoinMarketCap data by the time of writing this story. It topped out at $5.20 before the market correction started. During the last 30 days, Cosmos has seen +5% growth.
Coinbase Support Cosmos
Coinbase announced via a tweet that it was now supporting Cosmos (ATOM). All Coinbase customers can now buy, sell, receive, send, or store ATOM via Coinbase according to the tweet. Many crypto traders suspect the sudden price boost was due to what is known as the Coinbase Effect.
The price of the ATOM coin bottom out in September at $1.91 and it has been up progressively since then. Anyone who held onto the coin at the time would have seen his or her investment almost tripled today. Some experts have predicted that the price could eventually bottom out at $3.7. This figure was reached by examining historical trading data for the coin.
About Cosmos
Cosmos (ATOM) is the coin that powers a decentralized ecosystem of independent blockchains. It was created by All In Bit Inc and hopes to form the future of the internet. The company behind ATOM focuses on bringing all the factions in the blockchain ecosystem. This will enable interoperability and the Internet of Blockchain (IoB). The coin is used for staking as well as tokenizing transactions taking place in the ecosystem. To make this happen, the team behind ATOM is working on the Inter Blockchain Communication Protocol and Tendermint Core. These two components form the Cosmos Network.
About the Coinbase Effect
This term is used to describe what happens to a coin’s price once it is listed on the Coinbase exchange. While Coinbase is not the largest exchange by trading volume, it has a lot of respectability and visibility, especially amongst US crypto traders.
Once a coin is listed on Coinbase, it gains exposure to its over 15 million users from 190 nations globally. Its price usually starts to go up. A good example of this is the ATOM coin, whose price experienced this effect shortly after being listed. Some coins have seen their price double in about 24 hours after being listed.
However, this effect does not always work. For instance, when XRP was added to Coinbase during the 2018 crypto winter, its price saw almost no change. Another coin that experienced the opposite effect was the BAT token. After it was listed, its price went down 20 percent.
Is the Effect Real
In general, the Coinbase Effect does work. Some experts have concluded that it is due to FOMO. However, even the effect cannot beat the general trend of the market. If the crypto market is in a bear run, the effect does not usually work or it is subdued. When planning to buy a coin, you must conduct your research and decide whether it is a good investment.
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