Cosmos ecosystem is witnessing a battle for talent, reviewing the events surrounding the competition between Neutron and Osmosis for the Mars Protocol.

The Cosmos ecosystem is in the midst of a heated talent competition, as Neutron and Osmosis duke it out for control of the Mars Protocol. With both sides vying for the top spot, the intensity of their battle is taking the industry by storm. Let's take a closer look at the events leading up to this fierce rivalry.

Craving for traffic is always the unchanged melody of Web3 project development.

In the encrypted world, competition often exists between different ecosystems, and the competition within the same ecosystem may be even more apparent.

For example, in the recent Cosmos ecosystem, there was a “battle for users” surrounding the decentralized lending protocol Mars Protocol, which highlighted the desire for applications within the same infrastructure project.

Regarding the proposal of whether to deploy version 2 of Mars Protocol on Neutron or Osmosis, it has sparked widespread discussions in the crypto community. Both parties hope that Mars can be deployed on their own platforms and have extended olive branches to Mars.

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Below, we will provide a detailed account of the events and various perspectives to help you understand the relevant details.

Event Overview

On December 4th, Mars Protocol, a decentralized lending protocol on Cosmos, announced in an official statement that Mars Hub will deploy Mars v2 to Neutron (the Cosmos smart contract platform).

Official statement

On December 6th, the situation changed when Mars Protocol released a new proposal on its official website, titled: “Deciding Whether to Deploy Mars v2 to Neutron or Osmosis”.

In response, both Neutron and Osmosis have issued statements expressing their hopes that Mars Protocol will deploy Mars v2 on their respective platforms.

Explanation of related projects and proposals

Mars Protocol

Project Description

Mars Protocol was originally a decentralized lending protocol on Terra. However, following the collapse of Terra, Mars Protocol migrated to Cosmos. On January 31, 2023, Mars Protocol announced its launch on the Cosmos application chain, Mars Hub.

Currently, Mars is a decentralized lending protocol in the Cosmos ecosystem. Mars v2 has created a framework that allows users to long assets, short assets, borrow, mine yields, or lend.

The token is $Mars, with a market value of $10.95M and currently priced at $0.12.

Official website: https://marsprotocol.io/

Official Twitter: https://twitter.com/mars_protocol

Screenshot of the official website

Event Trigger

In September 2022, Mars Protocol published a paper titled “Why Cosmos Provides the Best Architecture for Building DeFi Products.” Specifically, Mars believes that the Cosmos chain offers a series of inherent advantages, making the Cosmos ecosystem potentially win long-term victories in the crypto world.

However, since that paper, the competitive landscape of application chain infrastructure has changed. In particular, the Ethereum ecosystem has developed attractive alternatives for those seeking customized advantages, such as OP Stack, ZK Stack, and Polygon Supernets.

Mars believes that for competition, there needs to be more integration, collaboration, and coordination within Cosmos, so for long-term development, Mars hopes to restructure.

Initially, Mars was inclined to deploy v2 in Neutron, and even proposed it on December 4th.

Then on December 6th, Mars opened a three-week discussion on its official website regarding whether to deploy v2 on Osmosis or Neutron.

Both Osmosis and Neutron hope that Mars Protocol will deploy v2 on their respective platforms, as described below.

Osmosis Project Overview

Osmosis is a cross-chain DEX built on top of the sovereign Layer1 blockchains in the Cosmos ecosystem. The chain supports developers to design and deploy customized AMMs using its various modules and leverage Osmosis’ on-chain governance system.

The token is $OSMO, with a circulating market value of $370M and a current price of $0.75U.

Project website: https://osmosis.zone/

Official Twitter: https://twitter.com/osmosiszone

Osmosis website screenshot

Osmosis’s Proposal

On December 4th, Osmosis proposed that Mars Protocol migrate to Osmosis.

In the proposal, Osmosis mainly explains why migrating Mars Protocol to Osmosis is more beneficial for its development.

• First, since Mars relaunched in February 2023, the relationship between Mars and Osmosis has been very close. To help Mars enter the market, Osmosis generously provided 310K OSMO in funding to increase the liquidity of Mars tokens. In addition, Osmosis also approved the use of MARS tokens for regular OSMO incentives.

• Second, most of Mars’ TVL and token liquidity are on Osmosis. However, according to DeFiLlama’s data, over 95% of Mars TVL is on Osmosis. Moreover, although MARS tokens are listed on both Osmosis and Neutron, over 95% of MARS token liquidity and trading volume are on Osmosis.

• Third, Osmosis has the highest IBC transaction volume. As Mars is an interchain protocol with outposts on many Cosmos chains, it makes sense for the Mars Hub to be located at the center of the IBC network.

• The proposal to move the Mars Hub to Osmosis does not contain any exclusivity clauses, while if Mars were to go to Neutron, it may be subject to the exclusivity clauses in the Neutron proposal (but on December 7th, the exclusivity clauses in Neutron’s proposal have been removed).

Neutron Project Overview

Neutron is a permissionless smart contract platform built using the Cosmos SDK. Developers can deploy their applications once and scale them across the entire Inter-Blockchain Communication (IBC) network without having to deploy or maintain multiple custom versions of their protocols.

The token is $NTRN, with a circulating market cap of $147M and a current price of $0.65.

Project website: https://neutron.org/

Official Twitter: https://twitter.com/Neutron_org

Screenshot of Neutron’s official website

Neutron Proposals

On December 4th, Neutron proposed migrating Mars Protocol to Neutron.

The main contents of the proposal are:

• The Neutron Foundation will allocate $3 million in USDC to the Mars Protocol Foundation every quarter for two years to support the development and growth of Mars Protocol.

• The Mars Protocol Foundation will grant the Neutron Foundation 60,000,000 MARS tokens. The granted MARS tokens will unlock linearly over six years, and the granted tokens can be used for governance during the lock-up period.

• The Mars and Neutron Foundation will work together to ensure that the granted MARS tokens are used for the mutual benefit of the Mars and Neutron protocols.

• The Mars Protocol Foundation will dedicate itself to propose and support the migration of Mars Hub to Neutron. It will further propose and support the following objectives, all of which require final approval from the Mars Council:

• Mars v2 will be deployed on Neutron by the end of the third quarter of 2024.

• Mars governance and MARS tokens will be transferred to Neutron by the end of the fourth quarter of 2024.

• From January 1st, 2024, major protocol upgrades will first be launched on Neutron. There are

• 10% of Mars Protocol DAO revenue will be used for the common interests of the Mars and Neutron protocols over the course of ten years.

Market Perspectives

The migration of Mars Protocol has sparked a lot of discussion within the Mars, Neutron, and Osmosis communities. Deep Tide has compiled some popular market perspectives for everyone’s reference.

The community generally believes that both Osmosis and Neutron have their unique advantages and disadvantages.

Advantages of migrating to Osmosis

• Non-exclusivity (although Neutron has also removed the exclusivity clause, putting both on the same starting line)

• If Mars wants to build perps (perpetual contracts), it may be listed faster because Mars v2 is already deployed on Osmosis

• Osmosis has a larger community size and more frequent activities compared to Neutron

• Osmosis is the DeFi center of Cosmos

Disadvantages of migrating to Osmosis

• Osmosis’ rapid technological innovation is advantageous for the Osmosis DEX itself. However, it may be detrimental for Osmosis L1 and Mars.

• Most of the development efforts of Osmosis will be focused on the Osmosis product, rather than assisting in building tools and services for other applications on Osmosis.

• Osmosis and Mars are potential competitors.

Advantages of migrating to Neutron

• If Mars’ development goes well in the future, Mars is likely to become the flagship defi product of Neutron.

• Neutron provides a neutral platform for Mars to build v2 without competing with native projects.

• The team behind Neutron comes from P2P (the same team building Lido) and they are experienced builders.

• Compared to Osmosis, Neutron is more like a general-purpose chain, making its incentives align more with Mars’ long-term goals.

Disadvantages of migrating to Neutron

• Compared to Osmosis, Neutron has fewer users, lower activity, fewer applications, and a smaller community.

• Starting from January 1, 2024, major protocol upgrades will be exclusive to Neutron for a period of three months, which may be unfavorable for Mars due to the three-month delay.

In conclusion, the decision of deploying the v2 version of the Mars Protocol on Neutron or Osmosis has sparked extensive discussions within these three communities, and the intense debate is expected to continue for three weeks. Mars Protocol plans to release a governance proposal for voting on-chain around December 26.

It should be clear that neither of these proposals involves Mars Protocol abandoning “Osmosis” or “Neutron.” Mars Protocol has strategic deployment intentions on both of these application chains, and the future development remains to be seen.

However, as the market rebounds, the competition for users and TVL among the infrastructures in the ecosystem is increasingly fierce. It is inevitable that a situation where an application is favored by multiple parties will occur again.

The thirst for traffic will always be the constant theme of Web3 project development.

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