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{"actor":"system:backfill","investigation_id":"f8d260d1-64e1-4e7d-a7e6-71e70b6c579b","kind":"publish","page_slug":"cosmos-hub","published_at":"2026-05-14T06:02:31.255Z","sequence_num":1,"snapshot":{"content_type":"investigation","entity_name":"Cosmos Hub","sections":[{"content":"Jae Kwon departed in 2020 amid accusations of religious discrimination and abusive behavior by co-developer Zaki Manian. He returned in 2022. Ethan Buchman stepped down from the ICF Council in December 2024. Multiple corporate restructurings occurred: Tendermint to Ignite to NewTendermint + Ignite split.","heading":"Founder Controversies","severity":"high","sources":[{"credibility":2,"name":"Decrypt: Cosmos Founder Stepping Down","type":"news_article","url":"https://decrypt.co/17993/cosmos-founder-jae-kwon-is-stepping-down"},{"credibility":2,"name":"CoinDesk: What Is Going On With Jae Kwon","type":"news_article","url":"https://www.coindesk.com/business/2020/02/04/what-is-going-on-with-jae-kwon-and-cosmos"}]},{"content":"The ATOM 2.0 whitepaper was vetoed in November 2022 with 37.4% NoWithVeto exceeding the 33.4% threshold. Proposal 848 passed in November 2023, cutting max inflation from 20% to 10%, which triggered Jae Kwon to launch the AtomOne fork.","heading":"ATOM 2.0 Rejection and AtomOne Fork","severity":"high","sources":[{"credibility":2,"name":"Blockworks: Cosmos Rejects ATOM 2.0","type":"news_article","url":"https://blockworks.co/news/no-with-veto-cosmos-community-rejects-atom-2-0-white-paper"},{"credibility":2,"name":"CoinDesk: Cosmos Founder Calls for Chain Split","type":"news_article","url":"https://www.coindesk.com/markets/2023/11/27/cosmos-founder-calls-for-chain-split-atom-down-3"},{"credibility":2,"name":"Blockworks: Cosmos Fork Jae Kwon","type":"news_article","url":"https://blockworks.co/news/cosmos-fork-jae-kwon"}]},{"content":"Proposal 952, a no-confidence vote against Interchain Foundation leadership, passed in September 2024. The Foundation went approximately 2 years without public financial reporting. The 2023 Annual Report was delayed until August 2024.","heading":"No-Confidence Vote Against ICF","severity":"high","sources":[{"credibility":2,"name":"DL News: Cosmos No-Confidence Vote","type":"news_article","url":"https://www.dlnews.com/articles/defi/cosmos-no-confidence-vote-shakes-up-internet-of-blockchains/"},{"credibility":2,"name":"Cosmos Forum: Proposal 952","type":"official","url":"https://forum.cosmos.network/t/proposal-952-passed-declaration-of-no-confidence-in-icf-leadership-call-to-action/14233/41"}]},{"content":"North Korean-linked developers allegedly contributed substantial code to the Liquid Staking Module from August 2021 to late 2022. Zaki Manian allegedly knew of an FBI investigation by March 2023 but did not disclose before advocating LSM integration. Disclosed in October 2024. Audits found no exploitable vulnerabilities.","heading":"North Korea-Linked LSM Developers","severity":"critical","sources":[{"credibility":2,"name":"Decrypt: NK Developers Helped Build Cosmos Module","type":"news_article","url":"https://decrypt.co/286539/developers-linked-to-north-korea-helped-develop-cosmos-staking-module-says-co-founder"},{"credibility":2,"name":"The Block: Cosmos North Korea LSM","type":"news_article","url":"https://www.theblock.co/post/321351/cosmos-liquid-staking-north-korea"},{"credibility":2,"name":"AiB: LSM NK Announcement","type":"official","url":"https://github.com/allinbits/announcements/blob/main/2024_10_15_lsmnk.md"}]},{"content":"Three major IBC vulnerabilities were disclosed: Dragonberry/Elderflower (October 2022), Huckleberry (May 2023), and ASA-2024-007 reentrancy bug (April 2024, $126-150M at risk). All were patched with no confirmed exploits. Osmosis DEX (separate protocol) lost $5M in June 2022.","heading":"IBC Security Vulnerabilities","severity":"high","sources":[{"credibility":1,"name":"GitHub: ASA-2024-007 Advisory","type":"official","url":"https://github.com/cosmos/ibc-go/security/advisories/GHSA-j496-crgh-34mx"},{"credibility":2,"name":"CoinDesk: Cosmos Bug $150M at Risk","type":"news_article","url":"https://www.coindesk.com/tech/2024/04/23/patched-cosmos-bug-couldve-put-150m-at-risk-says-firm-that-reported-it"},{"credibility":2,"name":"Blockworks: IBC Critical Vulnerability","type":"news_article","url":"https://blockworks.co/news/ibc-close-call-with-critical-vulnerability"},{"credibility":1,"name":"Jump Crypto: Huckleberry","type":"research","url":"https://jumpcrypto.com/writing/huckleberry-ibc-event-hallucinations/"},{"credibility":2,"name":"CoinDesk: Osmosis $5M Exploit","type":"news_article","url":"https://www.coindesk.com/business/2022/06/08/osmosis-chain-halted-amid-possible-5m-exploit"}]},{"content":"ATOM was named as a security by the SEC in lawsuits against Binance (June 2023) and Kraken (November 2023). Neither case was adjudicated on the merits. The Kraken case was dropped in March 2025 with no admission of wrongdoing.","heading":"SEC Regulatory Actions","severity":"high","sources":[{"credibility":2,"name":"CoinTelegraph: SEC Expands Binance Lawsuit","type":"news_article","url":"https://cointelegraph.com/news/sec-expands-binance-lawsuit-axs-fil-atom-securities"},{"credibility":1,"name":"SEC: Kraken Complaint","type":"regulatory","url":"https://www.sec.gov/files/litigation/complaints/2023/comp-pr2023-237.pdf"},{"credibility":1,"name":"Bloomberg: Kraken SEC Drops Lawsuit","type":"news_article","url":"https://www.bloomberg.com/news/articles/2025-03-03/kraken-is-latest-crypto-firm-to-say-sec-agrees-to-drops-lawsuit"}]},{"content":"Dynamic inflation model (7-20%) was capped at 10% by Proposal 848. Staking APR near 16% as of H1 2025. ATOM trades ~95% below its 2021 ATH of $44.80.","heading":"Token Economics","severity":"medium","sources":[{"credibility":2,"name":"Everstake: Cosmos Staking H1 2025","type":"research","url":"https://everstake.one/crypto-reports/cosmos-staking-insights-and-analysis-h1-2025"}]},{"content":"150+ IBC chains connected. IBC Eureka launched April 2025. However, key projects are departing or shutting down: Penumbra shut down, Osmosis in maintenance mode, Noble departing. Anoma co-founder Christopher Goes declared the ecosystem 'pretty much dead' in January 2026.","heading":"Ecosystem Health","severity":"high","sources":[{"credibility":2,"name":"CoinDesk: Cosmos Existential Crisis","type":"news_article","url":"https://www.coindesk.com/tech/2023/07/26/once-a-pioneer-cosmos-blockchain-project-faces-existential-crisis"},{"credibility":2,"name":"CoinDesk: IBC Eureka Launch","type":"news_article","url":"https://www.coindesk.com/press-release/2025/04/10/interchain-labs-launches-ibc-eureka-connecting-cosmos-ethereum-and-bitcoin-ecosystems-with-over-usd260-billion-in-market-cap"},{"credibility":2,"name":"BitcoinEthereumNews: Cosmos Pretty Much Dead","type":"news_article","url":"https://bitcoinethereumnews.com/tech/cosmos-founder-declares-ecosystem-pretty-much-dead-amid-funding-and-competition-woes/"}]}],"sources_used":[{"credibility":2,"name":"Decrypt: Jae Kwon Stepping Down","type":"news_article","url":"https://decrypt.co/17993/cosmos-founder-jae-kwon-is-stepping-down"},{"credibility":2,"name":"CoinDesk: Jae Kwon and Cosmos","type":"news_article","url":"https://www.coindesk.com/business/2020/02/04/what-is-going-on-with-jae-kwon-and-cosmos"},{"credibility":2,"name":"Blockworks: ATOM 2.0 Rejected","type":"news_article","url":"https://blockworks.co/news/no-with-veto-cosmos-community-rejects-atom-2-0-white-paper"},{"credibility":2,"name":"CoinDesk: Cosmos Chain Split","type":"news_article","url":"https://www.coindesk.com/markets/2023/11/27/cosmos-founder-calls-for-chain-split-atom-down-3"},{"credibility":2,"name":"Decrypt: NK Developers Cosmos","type":"news_article","url":"https://decrypt.co/286539/developers-linked-to-north-korea-helped-develop-cosmos-staking-module-says-co-founder"},{"credibility":2,"name":"The Block: Cosmos NK LSM","type":"news_article","url":"https://www.theblock.co/post/321351/cosmos-liquid-staking-north-korea"},{"credibility":2,"name":"CoinDesk: Cosmos Bug $150M","type":"news_article","url":"https://www.coindesk.com/tech/2024/04/23/patched-cosmos-bug-couldve-put-150m-at-risk-says-firm-that-reported-it"},{"credibility":1,"name":"Jump Crypto: Huckleberry","type":"research","url":"https://jumpcrypto.com/writing/huckleberry-ibc-event-hallucinations/"},{"credibility":2,"name":"CoinTelegraph: SEC Binance ATOM","type":"news_article","url":"https://cointelegraph.com/news/sec-expands-binance-lawsuit-axs-fil-atom-securities"},{"credibility":1,"name":"SEC: Kraken Complaint","type":"regulatory","url":"https://www.sec.gov/files/litigation/complaints/2023/comp-pr2023-237.pdf"},{"credibility":1,"name":"Bloomberg: Kraken SEC Drops","type":"news_article","url":"https://www.bloomberg.com/news/articles/2025-03-03/kraken-is-latest-crypto-firm-to-say-sec-agrees-to-drops-lawsuit"},{"credibility":2,"name":"DL News: Cosmos No-Confidence","type":"news_article","url":"https://www.dlnews.com/articles/defi/cosmos-no-confidence-vote-shakes-up-internet-of-blockchains/"},{"credibility":2,"name":"CoinDesk: Osmosis Exploit","type":"news_article","url":"https://www.coindesk.com/business/2022/06/08/osmosis-chain-halted-amid-possible-5m-exploit"},{"credibility":2,"name":"CoinDesk: Cosmos Existential Crisis","type":"news_article","url":"https://www.coindesk.com/tech/2023/07/26/once-a-pioneer-cosmos-blockchain-project-faces-existential-crisis"}],"summary":"Cosmos Hub (ATOM) is the flagship chain of the Cosmos ecosystem, built on Tendermint/CometBFT with IBC protocol. Founded by Jae Kwon and Ethan Buchman, the project has endured severe governance crises: ATOM 2.0 rejected (37.4% NoWithVeto), Jae Kwon's AtomOne fork, a no-confidence vote against ICF leadership, and North Korean-linked developers contributing to the Liquid Staking Module. ATOM was named a security in SEC lawsuits against Binance and Kraken (both dropped without adjudication). Three critical IBC vulnerabilities were disclosed but patched without exploitation. Ecosystem health is declining with key projects departing.","timeline":[{"date":"2017-04-06","event":"Cosmos ICO raises ~$17M in 28 minutes","source":"coindesk.com","source_url":"https://www.coindesk.com/business/2020/02/04/what-is-going-on-with-jae-kwon-and-cosmos"},{"date":"2019-03-13","event":"Cosmos Hub mainnet launches","source":"coindesk.com","source_url":"https://www.coindesk.com/business/2020/02/04/what-is-going-on-with-jae-kwon-and-cosmos"},{"date":"2020-02-01","event":"Jae Kwon departs amid accusations of abusive behavior","source":"decrypt.co","source_url":"https://decrypt.co/17993/cosmos-founder-jae-kwon-is-stepping-down"},{"date":"2022-06-08","event":"Osmosis DEX exploited for $5M","source":"coindesk.com","source_url":"https://www.coindesk.com/business/2022/06/08/osmosis-chain-halted-amid-possible-5m-exploit"},{"date":"2022-10-01","event":"Dragonberry/Elderflower IBC vulnerabilities disclosed and patched","source":"forum.cosmos.network","source_url":"https://forum.cosmos.network/t/cosmos-sdk-ibc-vulnerability-retrospective-security-advisories-dragonberry-and-elderflower-october-2022/8735"},{"date":"2022-11-01","event":"ATOM 2.0 whitepaper vetoed (37.4% NoWithVeto)","source":"blockworks.co","source_url":"https://blockworks.co/news/no-with-veto-cosmos-community-rejects-atom-2-0-white-paper"},{"date":"2023-05-01","event":"Huckleberry IBC vulnerability disclosed by Jump Crypto","source":"jumpcrypto.com","source_url":"https://jumpcrypto.com/writing/huckleberry-ibc-event-hallucinations/"},{"date":"2023-06-01","event":"SEC names ATOM as security in Binance lawsuit","source":"cointelegraph.com","source_url":"https://cointelegraph.com/news/sec-expands-binance-lawsuit-axs-fil-atom-securities"},{"date":"2023-11-01","event":"Proposal 848 passes: max inflation cut from 20% to 10%","source":"coindesk.com","source_url":"https://www.coindesk.com/markets/2023/11/27/cosmos-founder-calls-for-chain-split-atom-down-3"},{"date":"2023-11-27","event":"Jae Kwon announces AtomOne fork over inflation changes","source":"coindesk.com","source_url":"https://www.coindesk.com/markets/2023/11/27/cosmos-founder-calls-for-chain-split-atom-down-3"},{"date":"2024-04-01","event":"ASA-2024-007 IBC reentrancy bug disclosed ($126-150M at risk)","source":"github.com","source_url":"https://github.com/cosmos/ibc-go/security/advisories/GHSA-j496-crgh-34mx"},{"date":"2024-09-01","event":"Proposal 952: No-confidence vote against ICF leadership passes","source":"dlnews.com","source_url":"https://www.dlnews.com/articles/defi/cosmos-no-confidence-vote-shakes-up-internet-of-blockchains/"},{"date":"2024-10-15","event":"North Korean-linked LSM developer involvement disclosed","source":"decrypt.co","source_url":"https://decrypt.co/286539/developers-linked-to-north-korea-helped-develop-cosmos-staking-module-says-co-founder"},{"date":"2024-12-01","event":"Ethan Buchman steps down from ICF Council","source":"coindesk.com","source_url":"https://www.coindesk.com/press-release/2024/12/10/interchain-foundation-acquires-blockchain-solutions-provider-skip-to-reignite-cosmos-the-interchain"},{"date":"2025-03-03","event":"SEC drops Kraken lawsuit; ATOM securities designation unresolved","source":"bloomberg.com","source_url":"https://www.bloomberg.com/news/articles/2025-03-03/kraken-is-latest-crypto-firm-to-say-sec-agrees-to-drops-lawsuit"},{"date":"2025-04-10","event":"IBC Eureka launched connecting Cosmos, Ethereum, and Bitcoin","source":"coindesk.com","source_url":"https://www.coindesk.com/press-release/2025/04/10/interchain-labs-launches-ibc-eureka-connecting-cosmos-ethereum-and-bitcoin-ecosystems-with-over-usd260-billion-in-market-cap"},{"date":"2026-01-01","event":"Anoma co-founder declares Cosmos ecosystem 'pretty much dead'","source":"bitcoinethereumnews.com","source_url":"https://bitcoinethereumnews.com/tech/cosmos-founder-declares-ecosystem-pretty-much-dead-amid-funding-and-competition-woes/"}]},"v":1}