Quant Cryptocurrency Network Investment Report | Deep Dive
Review Date: August 13, 2021 |
Quant crypto (QNT) is an Ethereum token that is used to power Quant Network’s Overledger brand of enterprise software solutions, which aim to connect public blockchains and private networks.
Traditional companies that created the internet architecture we know today have failed to provide us with an open, secure, and most of all decentralized network to communicate and transact with one another. Aiming to solve this inherent problem by building upon the technologies introduced by Bitcoin, Quant Network hopes to be the bridge that connects all blockchains together – providing society with the necessary tools to revolutionize all industries.
Though the invention of Bitcoin marked a technological milestone, the inherent innovations and existing technologies that make up its structure were established well before Nakamoto proposed Bitcoin and blockchain technologies in 2009. These innovations- Merkle trees, concatenated hashes, and public-key encryption ultimately allowed blockchain innovations to flourish. Projects coming out of this technological fermentation are quick to adopt a specific model design, favoring function and monetary performance over others. With over 10000 cryptocurrencies in existence, the current blockchain ecosystem has become overcrowded and complex, with progress being achieved by few projects.
Realizing the necessity of other projects working together to define interoperability, Quant network believes that integrating all of these blockchain technologies together is necessary to achieve mass adoption. As the blockchain industry quickly expands, many new projects will offer distinct advantages over their competitors.
Quant is capitalizing on upcoming catalysts in the blockchain industry by proposing their own Overledger technology which brings with it the following solutions:
- Introduction of new scripting languages, or updating existing ones;
- Scaling applications (e.g.) increasing transaction speeds;
- Communication among different DLTS (distributed ledger technologies) for cross-ledger operations
- Adaptable technology that can change to meet demands in newer sector-specific requirements and regulation
- Mitigation tools against new security threats
Quant network’s proprietary Overledger technology is a new type of blockchain that solves blockchains dependency on a single distributed ledger system. By increasing interoperability among blockchains, Quant network’s Overledger is able to transcend existing architectures of addresses, networks, and consensus mechanisms – allowing new and existing technologies to run on top of different blockchains.
Aiming to become the pioneering solution that is bridging blockchain technologies, Quant network introduces a vendor-independent wire-level protocol for message-oriented middleware. By separating business logic from the underlying layer 0 frameworks, the Overledger is able to increase communicability among chains with the necessary security and privacy protocols expect.
Unique Value Proposition
Taking a new approach to solving blockchain interoperability and communicability issues, Quant’s Overledger escapes traditional “single-ledger dependent” technologies and provides projects with the necessary universal and general-purpose technology needed to push the industry to new heights. To understand the goal Quant network sets out to achieve one must first understand the features of a successful protocol that implements interoperability and communicability at the highest level. According to the Quant team, a successful protocol, which they aim to become will include the following parameters:
- Purpose: Build a platform with new features designed to address today’s DLTs challenges (slow transaction rates, migrations, cryptocurrency exchanges, etc)
- Interoperability: Build a network of blockchains where nodes have different roles and responsibilities (e.g. parent chain-sidechain, hub- zone, relay chain-para chain
- Layer of communication: Define a standard to connect blockchains to the platform
- Connection method: Build adapters to make existing technologies compliant with the standard
- Connection Speed: Transaction-oriented, not application-oriented
- Scalability: Connections at low levels strictly involving consensus mechanism
- Fault Tolerance: Tree/Graph network that requires complex routing algorithms
While there are many other “interoperable” protocols in the blockchain space, like Cosmos, Polkadot, Avalanche, and Solana – Quant network’s approach to the problem does not take a “single-ledger” approach. By allowing other blockchains and general-purpose applications to sit on top of different ledgers, Quant’s Overledger technology allows developers to build protocols that harness the benefits of all blockchains simultaneously creating protocols that are interoperable and communicable throughout the blockchain ecosystem. oping to promote innovation throughout the industry, Quants Overledger technology gives developers the tools to build decentralized multi-chain applications with smart contract capabilities and the ability to move data across different blockchains.
Quant network’s Overledger technology proposes a new methodology for interoperability. Providing a different approach than other protocols, Quant network’s Overledger provides an alternative to the classic problems of double-spending and ledger technologies.
Aiming to expand their footprint in the space Quant network’s proprietary protocol features can be extended to facilitate a new era of interoperability by achieving the following:
- Facilitating a global ecosystem for digital assets: While protocols like Ethereum, Polkadot, and Avalanche provided a new framework for blockchain protocols to flourish, their unguided attention to becoming the most sought-after blockchain ultimately hindered the potential of their innovations. By removing these network barriers Quant has created a global trading ecosystem that “for the first time – allows digital assets to flow, simply and seamlessly, around the world.”1 By providing true interoperability, customers of Quant can benefit with greater liquidity, 24/7 markets, lower transaction costs, fractional ownership, automated and quicker settlement, improved security and compliance, and a broader slate of possibilities with interoperable smart contracts.
- With the ability to supply greater liquidity than previously had in traditional markets, Quant’s technology can also be leveraged by wholesale and retail market participants to stop their reliance on cash reserves by way of CBDC’s (Central bank digital currencies). This gives participants the ability to stop their reliance on cash reserves, freeing up cash for corporations for future ventures and commercial banks to provide to businesses and private customers. The benefit of this is that all participants have the ability to access liquidity whenever they want, across borders.
- Stablecoin industry: by freeing up the movement of capital, Quant technology hopes to capitalize on being the go-to technology to harness the power of DLT’s to open up the corridors of interoperability among stablecoins.
The Overledger: What is it? and what role does it play in Quant’s ecosystem?
Overledger definition: the Overledger can be defined as an assorted list of messages which satisfy a set of unambiguous properties. Being a cross-chain interoperable protocol, these properties help define the valid format of a transaction and a transaction message giving them an order and making them part of a more complex application business logic.
According to Quants whitepaper:
“a transaction must contain the fingerprint of a valid message to be considered part of an Overledger application. The list of these messages defines what we call the Messaging Layer of Overledger. Another set of rules determines how to sort the valid messages in a sorted list we called the Ordering and Filtering Layer. A system using Overledger reacts to this sequence and can change its state. Any change in one of these sets of rules results in a different list of messages or a different permutation. More systems, with different control logic, can share the same Overledger if they respect the same rules.”2
Proposing an architecture similar to the one that formulated the internet and standard in telecommunications today, Quants Overledger technology is composed of the following features:
- Transaction Layer: The main function is to store all the transactions on a dedicated distributed ledger system. Includes operations to aggregate all connected DLT’s domains and data. The currently fragmented structure of blockchains however makes this task incredibly difficult as all transactions are executed on a specific blockchain. By separating business logic and control logic, Quant hopes to create a layer that represents different and isolated ledgers.
- Messaging Layer: With the capability of representing these disparate chains onto their own Overledger, this logical layer aggregates all relevant information retrieved from ledgers: this information can be smart contract data, transaction data, or metadata. This core layer of Quant provides the necessary interoperability to store all transaction information and messages of different blockchains in the same way as a channel of shared packets of different applications
- Filtering and Ordering Layer: This layer is responsible for creating connections between different blockchains on the Messaging layer – e.g. after initiating an order from an exchange with a special message, messages are then extracted and filtered and ordered on a separate layer than the transaction layer. In the case of metadata, this layer checks the validation of any out of chain messages; and the underlying application schema and its requirements. Making it possible for applications to only consider valid messages that move a certain amount of coins to a specific address.
- Application Layer: As an interoperable network that is capable of sharing metadata between blockchains, the construction of Quant’s application layer ensures that metadata gets to where it needs to go in the most efficient way. For example, Bitcoin’s op_return memo and Ripples ‘memo feed are able to communicate with one another and update the state of an application. The message references are the unique hash pointer to the transaction in the ledger containing the digest of the messages. The hash pointer is an identifier that can be used to uniquely select a transaction in a database and to verify it hasn’t changed.
Launching their mainnet in June of 2020, the Overledger is currently fully functional and interoperable with the following networks, with the hope of integrating the rest of blockchain applications in the future
- Hyperledger Fabric
- XRP Ledger
- Overledger Gateway API: Working in tandem with their Overledger technology, Quant’s gateway API allows enterprises to securely and easily access data across new markets and ecosystems. Using the Overledger, developers are able to provide secure and controlled access to blockchain interoperability – removing single points of failure and transaction bottlenecks. In order to leverage the API, organizations must have the native QNT token which acts as a license to the Overledger for internal use. With multi-chain smart contract capabilities, Overledger’s gateway API provides the necessary functionality across all distributed ledgers. 3
- Multi-DLT Smart Contracts: As the governing mechanism of Quant Network, Multi-DLT smart contracts dictate interactions between different distributed ledgers both off and on-chain. This allows enterprises and developers to implement complex operations between different blockchains, like cross-chain atomic swaps and multi-ledger tokens (MATIC).
mDapps (Multi-Chain Applications): Considered to be the standard in interoperability, Quant’s mDapps expand the scope and possibilities of DeFi and blockchain by increasing the network across multiple ledgers – enabling users and developers to extract more value and use from their assets. Using smart contracts to deliver its computational logic, Overledger’s DLT gateway enables these smart contracts to be written in any programming language supported by the various distributed ledger technologies (Solidity, Substrate, Rust). Overledger’s network architecture also promotes scalability for new projects by throttling and aggregating the majority of transactions from the Ethereum blockchain to a minimum number of transactions. For mDapps to harness the potential of Quant’s network they must have a specified amount of QNT tokens to keep a channel active – creating a deflationary cycle for the native token QNT by design. While single chain dApps like the ones being built on Ethereum are limited to a single network, QNT mDapps can facilitate transactions across multiple ledgers simultaneously. 4
Built using the Ethereum blockchain – QNT, the native token of Quant Network, serves the following function:
To be able to use the Quant network and its distributed ledger technology, developers, gateways, and enterprises have to purchase annual licenses which are paid in fiat and converted into QNT tokens.
By eliminating the need to go through a centralized exchange, users of the network do not have to worry about any potential arbitrage or unexpected fees. To make this process as efficient as possible the Quant team created an independent network oracle to provide pricing feeds for USD-QNT conversion. After purchasing the QNT token, users – whether it be an enterprise, developer, or gateway operator are required to lock up their QNT tokens for 12 months to access the network’s interoperable features. By implementing this deflationary mechanism, the supply of QNT decreases as token velocity and use increase. Hoping to create a constant yearly demand by implementing this method, the QNT token is expected to increase in utility as the platform grows exponentially alongside new licenses purchased each year.
Expected Platform Features Include:
- Access to gateways, platform fees, add- on services, marketplaces, and open source connectors to provide projects with interoperability and security.
- Combining any distributed ledger technology to create new products, multi-chain oracles, gateway staking, signing of transactions, and more.
As a necessary component to access the power of Overledger, QNT is a deflationary token with a fixed supply of 14,612,493 million tokens. By making QNT tokens available for purchase through their treasury directly the Quant team is ensuring the growth of its ecosystem to contributing participants. To gain access to the Overledger, users must hold a set amount of QNT tokens.
Quant currently has a liquidity ratio of 2% with a daily trading volume of 38million and a market cap of 1.8 billion.
During his time at the HM Treasury in the UK Government in 2009 and later as the Chief Information Security Officer for a Department of Health in Australia, founder Gilbert Verdian first realized the real potential of DLTs, including blockchains in solving the security- related problems in the global digital exchange. It was this conviction that led him to create Quant technology, his “brainchild”.
Gilbert went on to assume a position of leadership on the frontlines of interoperability and helped establish the Blockchain ISOStandard TC307. This has now become an international effort by 57 countries and organizations working to standardize the technology. At the time, others felt that interoperability would be irrelevant, but Gilbert foresaw that the market would continue to fragment and not consolidate.
In 2017, after working with the UCL Centre for Blockchain Research on early development, Quant put its eyes on advancing the original concept through a program that resulted in the filing of a patent. Today, there are many more patents pending, and Quant’s technology delivers enterprise-grade interoperability for the safe and secure exchange of digital assets and information through any network, protocol, or platform, with no extra overhead. Quant’s Overledge, is the first DLT gateway in the world and it connects existing systems and DLTs, to drive innovation and growth for regulatory bodies, public entities as well as companies.
Gilbert Verdian, CEO: A recognized pioneer in cybersecurity and DLT, Gilbert’s experience and enthusiasm inspire leadership. Gilbert has previous experience working at The Federal Reserve and the Bank of England.
Peter Marirosans, CTO: Peter excels in solving complex technical problems by encouraging a positive and collaborative environment. Graduated with a master’s in computer science from UCL.
PolkaDot, Polygon, Solano, Cosmos, Constellation
With Alpha Sigma Capital as the lead investor in their venture round, Quant network is also working with central banks around the world, governments, and some of the largest payment franchises in the world to re-create both the financial and social system we have grown accustomed to. Other partners include MIT, Intel, Juniper Networks, Sia, Oracle, Amazon, and Hyperledger.
The website is very informative and provides both developers and potential investors with enough information on the potential use-case of Quant and its unique position in the blockchain industry. The entirety of this investment report consists of extracted information from Quant’s whitepaper.
Quant network’s community size by platform:
Twitter: ~38,500 followers
Telegram: ~7,000 followers
Providing a unique alternative path to interoperability, Quant network aims to tackle the current infrastructure bottlenecks of blockchain. By sticking true to the narrative of decentralization and collaborating with traditional networks like central banks, governments, and enterprises – Quant has the potential to restructure the entire financial system. As a blockchain agnostic protocol built on Ethereum, Quant’s proprietary Overledger technology can horizontally scale and exponentially grow among developers, consumers, and enterprises as they realize the value they can extract from the ecosystem.
By combining multiple distributed ledger technologies together and making them accessible to the masses, Quant is a forward-thinking project with huge industry implications as the go-to interoperable solution. After evaluating the project in entirety, the Token Metrics team scored Quant Network objectively, and the results were the following:
|Good Use-Case||20/20||ROI Potential||4/10|
- “Quant Whitepaper.” Accessed August 12, 2021.
- “Quant Whitepaper.” Accessed August 12, 2021
- DLT. Value Beyond Speculation.
- Liljeqvist, Ivan. Quant Network. Ivan on Tech Academy.
Token Metrics Media LLC is a regular publication of information, analysis and commentary focused especially on blockchain technology and business, cryptocurrency, blockchain-based tokens, market trends, and trading strategies.
Token Metrics Media LLC does not provide individually tailored investment advice and does not take a subscriber’s or anyone’s personal circumstances into consideration when discussing investments; nor is Token Metrics Media LLC registered as an investment adviser or broker-dealer in any jurisdiction.
Information contained herein is not an offer or solicitation to buy, hold or sell any security. The Token Metrics team have advised and invested in many blockchain companies. A complete list of their advisory roles and current holdings can be viewed here: https://tokenmetrics.com/disclosures/