Cosmos (ATOM) is holding steady early on Tuesday, holding on to slight gains from the previous session, but analysts foresee more bullish moves ahead on account of its interoperability features which they see as an essential requirement to forge the future of crypto markets. At the time of writing, ATOM/USD is trading around $37.85.

Interoperability Sets Cosmos Stand Apart

One of the biggest fundamental developments that can lend support to Cosmos in the near term is the surge in activity over its Inter Blockchain Compatibility (IBC) Protocol over the past month. The protocol which handles cross-chain communication and enables interoperability between different kinds of blockchain networks handled more than 1 million transactions in the last 30 days alone.

With more blockchain networks being created and users and projects getting a wider range of options to choose from, one of the key features for survival in the highly competitive crypto industry will be interoperability. This is going to turn into a deciding factor that experts could leverage to gauge the future prospects of existing and upcoming blockchains going forward.

Interoperability will allow cross-chain transactions, making it easier for projects and users to send and receive data from different blockchains. The feature will bring about levels of scalability previously unknown as far as dApps and projects are concerned while driving up user adoption as well as it makes it easier for users to switch between protocols or projects on various networks as well. Cosmos’s IBC protocol was launched earlier this year and aims to do just this – supporting the transfer of tokens between IBC-compatible blockchains.

The future outlook for ATOM could be further boosted by the upcoming development of Evmos – a hub that will allow smart contracts on Ethereum to communicate within Cosmos. Formerly known as Ethermint, the project has recently been given a brand makeover and could bring about full EVM compatibility for Cosmos by as soon as the end of 2021. This could drive up further adoption of the blockchain network among dApps and offer stiff competition to Ethereum in the DeFi space.

ATOM/USD Technical Analysis

Leading crypto strategist and trader Michaël van de Poppe has forecast a strong rally in Cosmos (ATOM) in the current quarter. According to a recent tweet, he expects ATOM to cross the key $100 mark in the coming weeks by the end of this year.

Technical analysis of the 4-hour chart of ATOM/USD paints a mixed picture, with some of the smaller moving averages and leading technical indicators MACD and momentum exhibiting a bearish bias. On the other hand, the larger timeframe MAs – 50 EMA, 100 EMA and 200 EMA point to some interest among buyers as well.

Cosmos’s price is sitting right above the pivot point at $37.65, making it a very interesting time to keep an eye on it at the moment. An uptick in buying pressure can take ATOM higher and confirm a bullish trend. Although, if sellers jump in now, we could see it slide lower towards the immediate support at $33.67 instead.