Layer-Zero Wars: Cosmos, Polkadot, and Avalanche Compete to Define Web3’s Core Infrastructure

This content originally appeared on DEV Community and was authored by Philip Laurens

The vision of blockchain interoperability—seamless communication between sovereign networks—has transitioned from theory to implementation. Today, Cosmos, Polkadot, and Avalanche represent the leading contenders in what is being called the “layer-zero” race: the battle to become the foundational communication layer for Web3, similar to what TCP/IP is for the traditional internet.

Each project brings a distinct architectural approach and set of trade-offs that impact where developers build, how assets move, and what standards may ultimately dominate.

Cosmos: Leading With Interoperability and Modularity

Cosmos launched its Inter-Blockchain Communication (IBC) protocol in 2021 and has since built the largest production-grade interoperability network in the ecosystem. Over 115 independent blockchains are connected via IBC, moving over €900 million in value per month.

Key advancements:

• IBC Eureka (2025): A zero-knowledge bridge enabling direct interoperability with Ethereum.
• Interchain Security 2.0: Consumer chains can lease security from ATOM stakers while retaining governance autonomy.

Challenges:

• Cosmos lacks a centralized economic hub; ATOM’s market cap is relatively small compared to the total network it supports.
• Governance remains fragmented due to the sovereignty-first design of the ecosystem.

Polkadot: Prioritizing Shared Security and Governance Efficiency

Polkadot offers shared security and a native cross-chain messaging format (XCM), currently on version 3.0. Unlike Cosmos’s permissionless structure, Polkadot employs an auction mechanism for onboarding new parachains, introducing a higher level of curation and control.

Key advancements:

• XCM v3 and HRMP: Enable structured messaging between parachains.
• Polkadot 2.0 “JAM” Architecture (2025): Introduces elastic core-time and asynchronous backing to optimize performance and reduce costs.
• Governance Summit (2025): Previewed a shift to hard-capped DOT issuance and modular resource allocation.

Challenges:

• Slower onboarding pace: ~45 active parachains.
• Technical debt from legacy protocols like HRMP still in use by many chains.

Avalanche: Scaling Through Subnets and Native Messaging

Avalanche takes a different path, focusing on application-specific Layer 1s called Subnets, each inheriting security from the global AVAX validator set. The platform recently closed the interoperability gap with Avalanche Warp Messaging (AWM).

Key advancements:

• AWM Scheduler (2025): Enables real-time cross-Subnet communication without relying on external bridges.
• Enterprise Focus: Subnets allow for compliance-specific deployments (e.g., KYC-gated networks) without sacrificing native messaging capabilities.
• Brand Adoption: Enterprises like Intain and Alibaba Cloud have launched on Avalanche Subnets.

Challenges:

• Lower usage volumes compared to Cosmos and Polkadot.
• Cross-Subnet usage is still in early stages.

Comparative Snapshot (As of June 2025)

Why This Matters for Developers and Investors

Liquidity Access:

Cosmos processes over $1 billion per month through IBC, providing immediate volume for dApps.

Time-to-Market:

Cosmos offers permissionless deployment, ideal for fast iteration. Polkadot’s curated model offers stronger guarantees but slower rollout.

Regulatory Flexibility:

Avalanche enables institution-specific chains via Subnets with native compliance layers, eliminating the need for external bridges.

Remaining Challenges

1. Regulatory Fragmentation

Jurisdictions (U.S. ATS, EU MiCA, Asian VASP) treat chain-specific assets differently, complicating onboarding.

2. Fiat On-Ramps

None of the ecosystems have a production-grade integration with central bank digital currencies (CBDCs); fiat bridges and stablecoins dominate.

3. Bridge Attack Surfaces

Where native messaging is not possible, chains rely on bridges—a known attack vector for exploits exceeding nine figures.

Outlook for 2025 and Beyond

• Cosmos is targeting a full IBC-Bitcoin relay by Q4 2025, aiming to tap BTC liquidity directly.
• Polkadot will trial asynchronous backing and elastic core-time—expected to reduce onboarding costs by up to 90%.
• Avalanche is testing zero-knowledge AVM Subnets that enable gasless enterprise operations.

Final Take

The next evolution of blockchain infrastructure will not be defined by siloed chains, but by the networks that can speak to each other. Cosmos leads on interoperability and volume, Polkadot emphasizes security and governance, while Avalanche bets on specialization and enterprise modularity.

The market will not reward ideology—it will reward whichever system delivers performance, safety, and developer velocity at scale.

This content originally appeared on DEV Community and was authored by Philip Laurens