Stride just launched their proposal to become a consumer chain of the Cosmos Hub. If you watched our episode of check the chain a couple weeks ago you’ll remember Stride is the Liquid Staking chain that issues LSTs across Cosmos. This proposal will transition Stride from its own blockchain to become a consumer chain of the Hub instead. The proposal is as follows, with Stride sharing with the Hub:

• 15% of liquid staking rewards

• 15% of STRD inflationary staking rewards

• 15% of MEV revenue

• 15% of transaction fees

The proposal also includes the Hub putting up 450k ATOM ($5.3M) into an ATOM/stATOM Astroport liquidity pool on Neutron (the first tentative consumer chain) when it launches. This would be liquidity owned by the Hub and essentially sit there in perpetuity and collecting fees.

This is a fairly synergistic deal for both. Stride gets better security and no longer needs to rely on the economic value of its own token ($154M STRD vs $3.5B ATOM) and the Hub gets revenue in perpetuity from the (currently) leading LST. Stride has LSTs from numerous Cosmos chains, so it is somewhat of a proxy on the overall ecosystem growth, giving the Hub an actual true tie to every other zone for the first time (a common critique).

Two small differences vs the standard replicated security is that Stride is allowing the bottom 5% of validators to opt-out if they desire (due to costs of validating the Stride chain not being economical for them), and they will still have staking rewards for STRD holders who delegate to “governors” of the protocol (all validating will be done by the Hub).

If approved, we have signs of the “ATOM economic zone” forming, with the Hub, Neutron and Stride. More will be joining later, hoping to build off of some of this momentum in the back half of the year.