*Note: a SWOT analysis is an evaluation of the fundamental, operational, technical, social, economic, and even to some degree administrative elements of a project. This is not a model to be used for trading purposes. (NFA, DYOR)
Composed of four elements, Strengths, Weaknesses, Opportunities, and Threats, a SWOT analysis framework provides excellent insight for establishing a high-level understanding of the state of a project’s well-being through the lens of a birds-eye view.
It can help formulate decisions around which areas require more attention, set performance goals, and organize a foundational understanding of where a project is headed.
Rarely (if ever) used in crypto, it is time to apply this timeless method of evaluation to the digital asset space.
Today, Quant Network (QNT), the enterprise-grade interoperability operating system that is bridging networks through its Overledger protocol, will get a SWOT.
💪 Strengths (Internal) (Helpful)
1. Effective Economic Model
The QNT token has a “weak synchrony” between the project and the token, where the project’s hero product itself does not depend on the presence of QNT to survive but rather subtly ties it in as a parallel option for acquiring utilities of the network. What is extremely interesting is the process of the flow of money through the platform. First and foremost, any service that is purchased with fiat has a portion of that money funneled into operations of buying QNT from the open markets and locking it up for 12 months in a payments channel. Second, in order for developers to keep their gateways running (pay the $99 license fee), they must do so in the QNT token. Third, there are no psychotic bells and complex whistles of burning or other experimental primitives, making the assets itself arguably more fit and stable for its use case.
2. QNT is recognized by FINMA as a Utility
The Swiss Financial Market Supervisory Authority oversees the regulatory framework around QNT as a utility. Recognition by a government authority and acknowledgment that, by design, it falls outside the framework of money or security gives Quant Network space to pursue the development of their economic system with a higher degree of freedom than the vast majority of other projects.
3. World Class Team
The founders and executives on board have superstar track records through a multitude of industries. Their insights position them to dominate this space by sheer intellectual prowess. One of the founders in particular, Gilbert Veridan, is known for establishing an ISO standard for blockchains (TC307) that has been adopted by over 50 countries around the world, not to mention his involvement with some of the most recognizable multi-nationals such as PwC, BP, and Mastercard (among others).
4. Technological Positioning
QNT is not its own blockchain, nor is it a cryptocurrency (in the sense of an accounting or value exchange facilitating object); QNT is more of an “operating system” for building Mapps (multi-DLT smart contracts/applications that exist simultaneously across different networks). Existing somewhere between the folds of Web2 and Web3, Quant Network is basically uniting and serving all other networks. It is an interface for corporates with the on-chain world.
5. Amazing Onchain Token Distribution
Crypto projects are notorious for their overly concentrated token holdings; the vast majority of projects have terrible distribution ratios, with the top 50 accounts usually controlling upwards of 80%. Quant Network has done a phenomenal job with its token distribution; with over 141,000 total holders, the top 500 addresses (smart contracts and exchanges included) hold less than 43%. This shows a high level of attention to detail from the economic perspective of the project as well as a much more balanced allocation of power among the project’s participants.
6. No over-hype marketing
Quant network is unapologetically focused on delivering its services in a fashion that is appealing and familiar to legacy institutions and enterprises; they do not waste time trying to garner the attention of degens and do not look for approval from the industry’s rating agencies or security firms. This exudes extremely high confidence in their technical knowledge and likely attracts many sophisticated actors; while the argument that comes to mind immediately is “oh, they don’t want to get audited by Certik! They must not be serious”. Well, considering that they work with some global Web2 giants such as Oracle, it might also be just calculated positioning.
7. Legendary ROI Performance
While so many projects constantly harp on the financial elements of their project, squealing about how amazing their 10x returns are, Quant Network has generated what can easily qualify as one of the most impressive, consistent financial performances. Since the launch of its QNT token in August of 2018, the project has returned over 32,000% (this is after the calamitous bear market of 2022). Certainly, this is a technical/financial element; however, what is being highlighted with this measurement is the resilience of the involved parties and an expression of long-term commitment.
😞 Weaknesses (Internal) (Harmful)
1. Soft Social Presence
When comparing the level of success that Quant has been able to attain, both technologically and economically, it is uncommon (downright basically never) to find such limited social activity. Besides having a fair amount of followers on Twitter (~135k), a modest amount on Reddit (~17k), and a very light Telegram (~7.5k), the absence of other platforms reflects itself starkly in terms of the project’s digital presence.
2. No Open Metrics
The nature of Quant Networks’ involvement with a multitude of other chains while not being an open, public resource of its own means that all KPI data is nowhere to be sourced. Granted, they are servicing enterprise clientele, and the product itself is an abstract layer of technology to access other networks (and Quant Network actually talks about that it recommends using private chain solutions); making it nearly impossible to build an investment thesis on cold hard data.
🧐 Opportunities (External) (Helpful)
1. Obtained Patent
Quant Network has secured a patent for chronologically ordered transactions across different networks. Titled ‘Blockchain Communications and Ordering,’ the patient recognizes that Quant has been able to derive a method of effectively organizing transactions regardless of how the asynchrony of block times might vary from chain to chain. Patient #7273053 has thus far been granted in Japan (assuming that they have also submitted patent requests throughout all major jurisdictions as well).
2. Growing Interest for Tokenization
Tokenization is one of the hottest topics of financial innovation within the circles of megacorps such as Blackrock. A category known as RWA (real world Assets) has been gaining serious attention now that on-chain technology has matured and regulators around the world have begun to acknowledge the breadth of benefits and opportunities (such as fractionalization, transparency, accessibility, etc.) that tokenized assets bring. Quant Network provides tokenization solutions to enterprises, and given that they have been pursuing this path for the last few years, they have already developed the infrastructure and reputation and are aligned to take full advantage of this opportunity.
😳 Threats (External) (Harmful)
1. Competing Against Giants
Applicable to nearly every other serious crypto project, competition for Quant might be its only real threat. The sector and vector that Quant competes in is the enterprise/institutional client base. This means it goes up against other prominent projects such as Ripple (XRP), to try and attract the interests of the same clients. Surely, this is not a make or break regarding the project’s ability to survive, it is, however subjected to the network forces prevalent in this industry where the vast majority of the market consolidates on a single leader.
Takeaway:
Quant Network is a silent giant.
Obviously, technology well equipped and carefully designed to cater to its target market, this is a project that deserves much more attention than it gets.
QNT lacks in transparency on the level that we are used to from most “open” crypto projects; to be fair though, there is no native network to properly track the data. There is nowhere to see how much activity and what kind of activity is being engaged in through their project; however, that is not an existential threat; this might actually serve the company much better than if everything had been public.
Conclusion:
It was actually quite challenging to find sufficient resources to conduct this analysis; there is no whitepaper and very little coverage of QNT in recent times. Its blog is also rather dry in comparison to most other projects, but the intellectual density it provides highlights that it is run by and geared toward institutions rather than retail. Perhaps the strangest thing about QNT was the total absence of a company-issued tokenomics document anywhere to be found. Actually, there is a lot of controversial information that is just untrue; some platforms will offer staking for QNT, but there is no native staking module, so there is quite a bit of cognitive dissonance.
Something that I did not mention in the SWOT itself is the tokenomics supply model; the max supply is less than 15,000,000 QNT tokens; this is very low (lower than BTC), which could translate into much higher unit prices during the next market cycle. (This is a side hunch I have that it is worth watching low-supply tokens as a sub-category for the inevitable boom).
Another very interesting point that was not addressed is that the project itself was actually launched in 2015 (with no token). Later down the line, QNT was introduced as a vehicle to fundraise during the 2017 ICO boom, where it raised approximately $11 million USD. Projects from that era that did not scam and ultimately ended up as successful as QNT are basically non-existent (I don't know a single project of this quality caliber that performed this well).
So would I invest in QNT?
Oddly enough, yes.
I would take a punt; it satisfies many of my personal qualitative demands and provides some unique diversification to a crypto portfolio.
If you know something that I don’t or feel as though I might have missed anything worth noting, please do share, I would tremendously appreciate some feedback.
Thank you so much for reading,
I hope this serves you well on your journey.
Live long and prosper 🥂