SWOT analysis of ICO (ITO) project

Assessment of strengths and weaknesses, opportunities and threats to the external environment

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Project concept
5.5
Business model
4.3
The tech
5.0
Team
5.7
Tokens
5.3
Project support
5.3
Media Environment
6.0
Jurisprudence
4.6

Average score

5.1 / 7.0
Who needs super-fast blockchain? QuarkChain announces the creation of a new level blockchain, which will solve the problem of slow transactions forever, reaching speeds of 1 million transactions per second. In other words, the project creates a high-performance network that promises to be fast, scalable and secure. But this is promised by all. So what distinguishes QuarkChain from the rest?

The main feature of the project is its network architecture, that is divided into two levels. Transactions are processed on the first (sharding) level, and they are being confirmed on the second (root) level. The sharding level will consist of small blockchains (shards), that will process many transactions independently of each other, which will solve the problem of scalability and will increase the velocity of transactions: the more shards, the higher velocity.

In addition to increasing the capacity, the division of the network into two levels will be convenient for miners. The complexity of mining and the reward for the work will differ depending on the chosen level of blockchain (sharding or root).

And yet the main goal of the project is to increase the velocity of transactions. It should exceed 100 thousand transactions per second (TPS) in the fourth quarter of 2018, according to developers. A loud statement, but believable: a network test was conducted in March of this year, its result of 2279 tps significantly exceeded the capabilities of Ripple (1,500 tps), Bitcoin Cash (60 tpsS), Ethereum (10-25 tps) and Bitcoin (4- 7 tps).

The project is supported by a strong team with experience in Google, DELL EMC, Facebook, LinkedIn, Chartboost. Qi Zhou, the founder, worked as a software engineer in Facebook. Jagun Wang, Chief Project Engineer, has 7 years of experience developing software for the same Facebook, Instagram and Google. Experts in the field of VC investments and management of crypto funds, as well as the founders of Cloudant, DSSD and cyber security expert from Virginia Tech, are among project advisers.

Now it is time to talk about the most interesting - the price on the exchange. Similar projects show a significant increase in tokens quotes: Fusion - 2,41x, Cardano - 13x, and the price of the token of the main competitor QuarkChain, Zilliqa, has grown 20 times (while the capitalization of Zilliqa exceeds the QuarkChain’s hardcap 46 times).

QuarkChain attracted $ 16 million at Private Sale (the hardcap is $ 20 million), that means that many investors have already calculated how much QKC token could grow in price.


And yet the project has shortcomings - QuarkChain does not disclose its financial plan and postpones the development of the partner network until the launch of MainNet. Such a delay in attracting partners is dangerous in the dynamic crypto market: infrastructure projects are the most popular among investors, but they breed like rabbits.

If QuarkChain will hurry to find partners and reach its plan of 1,000,000 tps (which is quite possible given the test results) in 2019 it will not only speed up the leading centralized payment systems (VISA and Alipay), but it will also enter the TOP-50 projects by the volume of capitalization in the cryptocurrency market.

Strengths

The team has studied the competitive landscape and described the project's competitive advantages
Blockchain technology is necessary for the project
The team described in detail the business model of the project
There is a clear roadmap
The issuance of tokens is limited
The legal structure of the company is transparent
The project is popular on social networks and in thematic communities
The project is widely discussed on blockchain news resources
The founders and leaders of the project are recognized professionals in their fields and in the blockchain industry
The project team has extensive experience and a strong track record
The project has a strong advisory board
The project’s partners are large and well-known
The team has a working product
The project founders have experience of implementing a successful business in the project field

Weaknesses

There is no detailed financial plan
There are no tools (for example, the use of an escrow) that would guarantee the return of investments, if the stated usage of funds is not followed

Opportunities

Expansion of the market / Creating a new market niche
Increasing demand for the company's product
The growth of the token exchange rate in the medium and long term
Increased demand for tokens from ecosystem participants
The project activities are carried out with the fulfillment of the requirements for the processing and storage of personal data
AML Activities
Increased trust in the project and growth in investment
High level of the company's influence on the market
Activities in the legal field of entrepreneurship and tax payments

Threats

There is a risk of anauthorized withdrawal of funds through a vulnerability in the code

Recommendations for the project

High-priority tasks

  • Develop a detailed financial plan
  • Implement tools (for example, the use of an escrow) that would guarantee the return of investments if the stated usage of funds is not followed
  • Carry out a safety audit of the smart contract and publish the results

More information is required

  • about the readiness of the smart contract and platform protocol code
  • about compliance with the legislation requirements of the securities market and on the taking preventive measures
  • about the conditions of the token sale

Medium-priority tasks

  • Supplement the description of the competitive landscape and the project's competitive advantages
  • Detail the description of the business model
  • Finalize the roadmap
  • Make the legal structure of the company more transparent
  • Increase activity on blockchain news resources
  • Establish additional partnerships with large and well-known companies
  • Cooperate with additional experts with experience in implementing a successful business in the project field
  • Improve the mechanism for protecting tokens against devaluation
  • Introduce additional tools of motivation for owning the tokens in the ecosystem
  • Attract additional large VC investors to the project
  • Improve the competitive advantages of the product and project
  • Work out additional legal risks of project implementation
The results of SWOT analysis express the views of DigRate and does not constitute a statement of fact or recommendation to buy, hold, or sell these or any other assets, or make investment decisions. This information may be distributed without the prior consent of DigRate, but must contain links to www.digrate.com