Interchain Labs (ICL) has shifted its strategy, deciding to abandon plans to make the Cosmos Hub a smart contract platform. Instead, ICL aims to enhance the Cosmos Stack as an infrastructure toolkit for sovereign Layer 1 chains, focusing on institutional customers who require dedicated networks with selective interoperability. The decision comes after leadership recognized that integrating the EVM into the Hub was overstretching resources and failing to attract new developers and investors. ICL co-CEOs expressed concerns over rising costs and a saturated market. They believe institutional demand, particularly from banks and stablecoin issuers, will drive the need for customizable chains connected via IBC. Although ICL maintains that ATOM will remain central to monetization, specifics on how it will sustain value are unclear. Additionally, there are challenges in supporting developers who had prepared for Hub-native deployments, and trust issues may arise following this pivot. To counteract past criticisms of strategic inconsistency, ICL is narrowing its focus and intends to foster collaborations that leverage Cosmos for institutional solutions, potentially launching a more defined vision for the future.

Source đź”—