Cosmos-based networks Umee and Osmosis will merge via a software update, according to a Dec. 4 announcement. Umee's UX Chain code will be re-implemented on the Osmosis chain, allowing features from the two networks to be combined and creating what the development teams call a "DeFi Hub" for the Cosmos ecosystem.
Umee is a decentralized lending protocol that runs on its own dedicated Cosmos chain called “UX Chain”. Osmosis, on the other hand, is one of the largest decentralized exchanges (DEX) in the Cosmos ecosystem and also runs on its own dedicated network. is over $23 billion in accumulated volume and is the the largest room Cosmos Chain in terms of total value locked (TVL), according to DefiLlama.
According to the announcement, the development teams behind the protocols agreed to combine the two networks, allowing the lending app and DEX to exist on the same chain. The teams claim this will enable advanced features on the exchange that were not possible before, including spot margin trading, short selling, liquidations, stablecoin pools, cross-chain flash lending, MEV markets, and others.
“The combined architecture of both chains' functionality will open the door to flash lending and new forms of MEV on the same DeFi Hub,” said Osmosis co-founder Sunny Agarwal, adding: “We originally thought of flashmint through protorev to multiple types of cross-chain Arb, and realize[d] a lending protocol on the same chain would further optimize this vision.”
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The announcement did not indicate a specific date for the merger. Instead, it urged users to "stay tuned for more updates." UX, the token of Umee UX Chain, “will continue to exist,” CEO Brent Xu clarified in a statement to Cointelegraph. The development team will make a proposal that "will have a call to action for the community to discuss and decide how to manage tokenomics" of UX, Xu said.
Osmosis implemented a concentrated liquidity feature for the first time on July 12. On October 3, he announced that would allow a bridge version of Bitcoin (btc) to be traded on the stock market.
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