Why did the price of ATOM fall?

Cosmos (ATOM) dropped 3.36% to $3.48 in the last 24 hours, performing slightly worse than the overall crypto market, which fell 3.09%. The main reasons for this decline include ongoing market weakness after a major crash, challenges within the Cosmos ecosystem, and negative technical signals.

1. Market-wide sell-off effects – Aftershocks from a huge $20 billion liquidation event on October 10.
2. Ecosystem challenges – Akash Network plans to leave Cosmos, which could weaken the network.
3. Technical downtrend – ATOM’s price fell below important support levels with little buying interest.

Deep Dive

1. Market Liquidation Aftermath (Negative Impact)

Overview: ATOM is still feeling the effects of the October 10 market crash, which saw $20 billion in crypto assets liquidated—the largest single-day sell-off ever. Binance clarified that ATOM’s brief drop to $0 was a glitch caused by outdated orders, but the event highlighted how smaller cryptocurrencies can face serious liquidity problems.

What this means: Because there aren’t many buy and sell orders for ATOM (its 24-hour trading volume of $179 million is only about 11% of its total market value), the price can swing wildly. This low liquidity makes it harder for ATOM to recover quickly, as traders remain cautious about investing in smaller or less stable coins after the market reset.

2. Akash Network Leaving Cosmos (Negative Impact)

Overview: Akash Network, a key decentralized cloud service built on Cosmos, announced it plans to shut down its Cosmos-based blockchain and possibly move to other platforms like Solana. This could reduce developer activity and staking within the Cosmos ecosystem.

What this means: Cosmos’s value depends on being a central hub connecting different blockchains. If important projects like Akash leave, it could weaken the network’s overall strength and reduce demand for ATOM, which secures these connections. This news contributed to an 8% drop in ATOM’s price on October 13.

3. Technical Downtrend (Negative Impact)

Overview: ATOM’s price fell below its 7-day and 30-day moving averages ($3.65 and $4.14 respectively), signaling a clear downward trend. Technical indicators like the MACD show increasing selling pressure, while the RSI is nearing oversold levels but hasn’t yet indicated a rebound.

What this means: The next key price support is at $3.42, which is the 50% Fibonacci retracement level. If ATOM falls below this, it could drop further to around $3.09. Trading volume shows weak buying interest, with recent volume increases mainly due to selling.

Conclusion

ATOM’s recent price drop is due to a combination of lingering market instability, ecosystem uncertainties, and negative technical trends. While the coin may see short-term rebounds because it’s oversold, the lack of strong positive news and declining developer activity suggest investors should be cautious.

Key points to watch: Will ATOM hold the $3.42 support level? And can the upcoming Cosmos SDK v0.53 upgrade on October 20 help improve confidence in the ecosystem?

What could affect the price of ATOM?

ATOM is facing some challenges, including technical issues and uncertainty within its community, but important upcoming upgrades could help boost its growth.

1. Risk of Projects Leaving – Akash Network thinking about leaving Cosmos points to a bigger risk of other projects leaving too.
2. Inflation Pressure – ATOM’s yearly inflation rate of 7-10% puts downward pressure on its price, even though staking offers good rewards.
3. Slow Adoption of Interchain Security – Limited use of Interchain Security means less fee income for stakers.

Deep Dive

1. Ecosystem Fragmentation (Negative Impact)

Overview: Some major projects, like Akash Network, are considering moving away from Cosmos SDK-based chains because of concerns about scalability and security. This follows DYDX’s move in 2024 to its own Cosmos-based chain, which took value away from ATOM.

What this means: When projects leave, ATOM becomes less useful as a staking and security token. If the $15 billion DePIN sector (where Akash operates) moves elsewhere, it could slow down Cosmos’s growth significantly.

2. Inflation vs. Value Growth (Mixed Impact)

Overview: ATOM’s inflation rate of 7-10% is much higher than Ethereum’s 0.5-1%. Meanwhile, Interchain Security currently adds less than 1% to staking rewards. There are proposals to reduce inflation to 2-4%, but governance disagreements are slowing progress.

What this means: The high inflation reduces the benefits of staking’s 11% annual return, leading some holders to sell. If inflation is successfully lowered (see forum discussion), ATOM could become scarcer and more valuable, but this requires agreement among validators.

3. Technical Upgrades (Positive Potential)

Overview: The upcoming Eureka upgrade (expected Q4 2025) will allow transfers between Ethereum and Cosmos using IBC (Inter-Blockchain Communication). The v12 “Lambda” upgrade aims to reduce block times to 1.5 seconds, which is important for competing with fast blockchains like Solana in decentralized finance (DeFi).

What this means: Faster transaction finality and better compatibility with Ethereum could attract more developers if these upgrades happen on time. However, a crash on October 14 showed that ATOM can be vulnerable to exchange issues during volatile market conditions.

Conclusion

ATOM’s future depends on successfully rolling out its interoperability upgrades and stopping projects from leaving the ecosystem. Keep an eye on the November 2025 governance vote about inflation—if validators agree to reduce it, that could be a strong sign of tighter monetary policy. The big question is whether Cosmos can maintain its decentralized nature while moving quickly enough to keep developers engaged.

What are people saying about ATOM?

Cosmos traders are weighing hopes for a price breakout against recent challenges in its ecosystem. Here’s what’s trending:

1. Technical analysts see $4.35 as a critical support level
2. Developers are optimistic about Cosmos’ focus on interoperability
3. Akash Network’s plan to leave Cosmos is causing concern

Deep Dive

1. @ali_charts: Cosmos price pattern signals potential big move 🚨 bullish

"Cosmos $ATOM triangle consolidation nearly at the apex. Watch for a 30% move!"
– @ali_charts (298K followers · 1.2M impressions · 2025-08-30 03:08 UTC)
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What this means: This is a positive sign for ATOM. The price has been moving within a symmetrical triangle pattern, which often leads to a strong price move. Traders expect up to a 30% change, but whether the price goes up or down depends on if the $4.35 support level holds.

2. @cosmos: Cosmos SDK praised amid EVM compatibility concerns mixed

"The Cosmos SDK is by far the most robust stack for building application blockchains"
– @cosmos (1.1M followers · 4.8M impressions · 2025-08-05 16:24 UTC)
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What this means: This is a mixed signal for ATOM. The Cosmos SDK (software development kit) is highly regarded and attracts developers to build on Cosmos. However, Cosmos moving away from Ethereum Virtual Machine (EVM) compatibility may push away projects that rely on Ethereum’s technology. The recent 4% price increase after this news didn’t last long.

3. @TheBlock: Akash Network’s exit unsettles Cosmos bearish

"Akash will deprecate its Cosmos-based chain and evaluate a new base network"
– @TheBlock (427K followers · 2.1M impressions · 2025-10-13 09:43 UTC)
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What this means: This is negative for ATOM. Akash Network, which accounts for 23% of Cosmos’ $1.6 billion in decentralized physical infrastructure network (DePIN) value, plans to leave Cosmos. This news caused Akash’s token (AKT) to jump 12%, while ATOM’s price dropped 4%, highlighting some instability in the Cosmos ecosystem.

Conclusion

The outlook for Cosmos is mixed. Technical traders are watching for a breakout above $4.50, but concerns about projects leaving the network and a recent price glitch on Binance (a major crypto exchange) add bearish pressure. The $4.20 to $4.35 price range is key: if ATOM stays above this zone, it could signal strong buying interest; if it falls below, it might confirm weakening confidence in the network.

What is the latest news about ATOM?

Cosmos is navigating challenges from exchange issues and changes within its ecosystem, all while facing important decisions about its network’s future.

1. Akash Network Plans to Leave Cosmos (October 13, 2025) – A major decentralized computing project is considering moving to another blockchain to improve security.
2. ATOM Price Briefly Dropped to $0 on Binance (October 10, 2025) – A technical glitch during a massive $20 billion market crash caused panic.
3. Binance Compensates $283 Million for Crash Losses (October 13, 2025) – The exchange reimbursed users affected by price errors and liquidation mistakes.

Deep Dive

1. Akash Network Plans to Leave Cosmos (October 13, 2025)

Overview:
Akash Network, which provides a decentralized marketplace for GPU and computing power, announced it might move away from its current Cosmos-based blockchain to another platform, possibly Solana. The goal is to improve scalability and security as demand for AI computing grows. Akash will still support interoperability through IBC (Inter-Blockchain Communication).

What this means:
This move could weaken Cosmos’ position since Akash is a significant project within its ecosystem. Losing Akash might split liquidity and reduce network activity. However, Cosmos is releasing an important software upgrade (SDK v0.53) on October 20, and Akash is also integrating AI features (AkashML), which could help keep the project within Cosmos. (Cryptotimes)

2. ATOM Price Briefly Dropped to $0 on Binance (October 10, 2025)

Overview:
During a historic $20 billion crypto market crash, ATOM and other tokens briefly showed a price of $0 on Binance due to a decimal-setting glitch. This happened despite normal trading on other platforms. Low liquidity made the problem worse, but prices partially recovered after the incident.

What this means:
This event shows the risks of relying on centralized exchanges during times of extreme market stress. The 19% weekly drop in ATOM’s price reflects overall market pressure, but the glitch was not due to any problem with the Cosmos network itself. (CoinDesk)

3. Binance Compensates $283 Million for Crash Losses (October 13, 2025)

Overview:
Binance set aside $283 million to compensate users who lost funds due to forced liquidations during the crash, including those holding ATOM. The exchange blamed the price errors on outdated limit orders and promised to improve its price oracles (data feeds).

What this means:
While this compensation helps restore user confidence in the short term, it highlights ongoing concerns about the reliability of centralized exchanges. ATOM’s 14% weekly price drop shows that traders remain cautious about sudden exchange-related volatility. (The Block)

Conclusion

Cosmos is facing challenges from both technical issues on major exchanges and the risk of losing key projects like Akash. Although ATOM’s price has been volatile, dropping 26% over the past month, the network’s core technology for connecting blockchains remains strong. The upcoming SDK v0.53 upgrade and the resilience of IBC will be critical in overcoming these challenges.

What is expected in the development of ATOM?

Cosmos is focusing on improving its cross-chain technology and growing its ecosystem.

1. Interchain Security Upgrades (2025) – Validators will secure multiple blockchains, increasing the usefulness of ATOM.
2. Cross-Chain DeFi Growth – Enhancements to Gravity DEX and the Ethereum bridge will improve liquidity and asset transfers.
3. Staking Derivatives Launch – New tokens will let users unlock staked ATOM for use in DeFi while still earning rewards.

In-Depth Look

1. Interchain Security Upgrades (2025)

What’s happening:
Cosmos is upgrading its Interchain Security system. This lets validators on the Cosmos Hub protect other blockchains (called “consumer chains”) and earn rewards for doing so. This shared security approach helps new projects get started more easily by reducing their initial costs.

Why it matters:
This is good news for ATOM holders because it ties the demand for network security directly to staking ATOM. Validators could earn more rewards, encouraging people to hold ATOM longer. However, the technology is complex, and Cosmos faces competition from other networks like Polkadot.

2. Cross-Chain DeFi Growth

What’s happening:
The Gravity DEX (a decentralized exchange) and Gravity Bridge (which connects Ethereum and Cosmos assets) are being improved to lower fees and reduce price slippage. Recent updates now allow smart contracts to work across different blockchains (ProBit Global).

Why it matters:
This development is somewhat positive because better DeFi compatibility could attract projects from Ethereum to Cosmos. Still, success depends on how many users choose Cosmos over other popular networks like Avalanche or Polygon.

3. Staking Derivatives Launch

What’s happening:
Cosmos plans to introduce liquid staking tokens, such as stATOM. These tokens let users stake their ATOM but still use a derivative version in DeFi activities like lending or borrowing. This solves the problem of ATOM being locked up during staking periods.

Why it matters:
This is promising because it increases ATOM’s usefulness in financial markets. On the flip side, if too many people use these derivatives with high leverage, it could create risks during market downturns.

Conclusion

Cosmos is working hard to become a key player in blockchain interoperability by upgrading security and expanding DeFi tools, which should boost ATOM’s value and utility. While there are technical challenges, successful adoption could make ATOM a valuable asset in diversified crypto portfolios. It will be interesting to see how competitors like Avalanche and Polygon respond to these advancements.

What updates are there in the ATOM code base?

Cosmos is making big improvements to speed and security.

1. BlockSTM & MemIAVL Upgrades (June 11, 2025) – Now supports 60,000 transactions per second (TPS) and processes blocks 10 times faster.
2. SDK v0.53 Security Fixes (July 8, 2025) – Important updates to keep the network stable and secure.
3. Strong Developer Activity (June 22, 2025) – Over 950 code updates in six months, showing active growth.

Deep Dive

1. BlockSTM & MemIAVL Upgrades (June 11, 2025)

What happened:
Cronos Chain, built with help from Cosmos developers, launched new upgrades called BlockSTM and MemIAVL. These improvements are now available for all Cosmos-based blockchains.

Why it matters:

• Cosmos can now handle 60,000 transactions per second, up from about 10,000, by processing transactions in parallel.
• Nodes (computers running the network) can sync in just 5 minutes instead of 16 hours, thanks to more efficient data storage.
• These upgrades work smoothly with existing Cosmos software modules.

Impact:
Faster transactions and quicker node syncing make it easier for developers to build scalable decentralized apps (dApps). Users will enjoy smoother interactions across different blockchains.
(Source)

2. SDK v0.53 Security Fixes (July 8, 2025)

What happened:
Critical security patches were released for Cosmos SDK versions 0.53.3 and 0.50.14 to fix a bug where staking rewards could overflow and stop the blockchain.

Key points:

• Affects blockchains using the x/distribution module, which handles staking rewards.
• Requires coordinated upgrades across networks, which can temporarily disrupt services.
• Fixes come after audits by security firm Halborn and community reports.

Impact:
While validators (network operators) must act quickly, these fixes improve long-term network reliability and boost confidence among institutional users.
(Source)

3. Strong Developer Activity (June 22, 2025)

What happened:
Cosmos led all major blockchains in GitHub activity, with over 950 code commits in six months.

Focus areas included:

• Interchain Security v2: Shared security across multiple blockchains.
• SDK Modularity: Easier tools for building custom blockchains.
• IBC Protocol: Better communication between different blockchains.

Impact:
High developer engagement suggests a growing and healthy ecosystem, attracting more projects to build on Cosmos.
(Source)

Conclusion

Cosmos is focusing on three key areas: boosting performance with BlockSTM, strengthening security through SDK updates, and encouraging developer growth. These efforts make ATOM a strong player in building flexible and connected blockchain networks.

Will faster transactions and easier node management help Cosmos attract more institutional validators in 2026?