Welcome to another edition of my ICO reviews.

In a short span of time Quarkchain has garnered tremendous fan following and in just a few days of their whitelist opening, their telegram group has jumped from 20Ks to 80Ks. So it is just appropriate that I take this ICO through a review.

By the way X-43A is one of the fastest (if not the fastest) military jet out there, so the reference is to the increasing speed with scalability possible as per the Quarkchain team.

Key Factors of ICO that will help if one should invest at ICO stage.

Note - If you are not on their telegram channel before May 4th then your only chance is to do a write or video about them by May 15 11:59:59AM PST and submit to [email protected] and then jump on to their telegram to get whitelisted (they use a telegram bot for whitelisting) and be prepared to rock their quiz. Shared a link in reference section so you get more details around participating in their ICO

Summary of Quarkchain

Name of Project - Quarkchain
Name of token - QKC
Website - https://www.quarkchain.io/
Hardcap - 20 million (16 million private sale and 4 million public sale. There is no presale)
** Total number of Tokens** - 10 billion QKC
Total tokens in Sale - 2 billion (this includes both private sale and public sale)
Token Type - ERC-20 token (will be swapped for native token on launch of mainnet).
Current stage - Whitelist (cutoff is May 20th PST - but depends on where on the globe you are).

What problem is Quarkchain solving

Quarkchain scores 2 thumbs up here as they are solving the most critical issues plaguing todays blockchains, namely, scalability, speed, transaction fees, cross chain interactions, risk of centralizing mining and some more.

What are major ICO review websites saying about Quarkchain

Quarkchain scores a thumbs up on this one.

There is a lot of good buzz on the internet for Quarkchain (even from popular ones like crushcrypto and cryptobriefing)
But for a few comments on their ability to deliver the promised TPS, almost everyone has written positive reviews for them.

Whitepaper and MVP

Quarkchain scores a medium on whitepaper.

The whitepaper is written for the average person, so that is a good thing. Deeper details on creation of shards, how collaborative mining incentives will actually ensure decentralization (and stop super nodes from forming clusters), how 25% hashpower needed by attacker leads to better security than bitcoin where attacker needs at least 51%, would have helped. There are other blogs which provide such deeper details (links in reference section), but i am not sure how much to trust them. I would rather trust what is in the official whitepaper (and anything missing there is a negative).

I have not been invited to their testnet, so i really can't comment on the MVP. The following excerpt is from hacknoon article on Quarkchain (https://hacked.com/ico-analysis-quarkchain/)
"QuarkChain is ahead of schedule with their testnet up and running with 2,000 TPS was observed during a recent audit. Achieving 10,000 TPS is the next milestone on their roadmap. QuarkChain has made their Github publicly available. Resumes are being accepted at [email protected] for 100 volunteers to help test the latest testnet. The mainnet is scheduled for release Q4 2018."

Team and Advisors

Quarkchain scores a thumbs up on their team and advisors.

The only concern would be the experience of the founder, Qi Zhou (roughly 4 years). On the positive side he has very good academic credentials from good colleges. He has also worked at Google, EMC, and Facebook.

The rest of the team has very good academic credentials and experience from top tier colleges and companies.

The advisors are top notch.

In the reference section i have shared a link on why this team is top notch (the author did a wonderful job researching the team and presenting and it chimes in with my own on-line research for the team).

Token Economics.

Quarkchains token metrics seem very good.

With a hardcap of just 20 million the upside seems good. The 16 million USD of that was for private sale and tokens for private sale get unlocked in a phased manner which gives public sale investors room to make quick short term profit (i would not suggest shilling though if you believe this project will deliver as long term upside is way too high).

Tokens for team, founders and advisors is locked up for 2 years. This is also great for token price to appreciate.

Nearly 45% tokens are locked up for mining, community and marketing. This is also great, but a breakup, especially for marketing would have been nice to know.

Token metrics is better understood when compared with a similar blockchain and their closest competitor looks to be Zilliqa.

Quarkchain appears to have priced its token for ICO much higher than what Zilliqa had priced its token to during their ICO, so this is a negative for me (My calculations could be off, but i feel it is at least 10x more expensive then what Zilliqa priced its token at).

Having said the above, today Zilliqa's market cap is at 1.2 billion (with 7.2 billion tokens in circulation), so that still gives Quarkchain a very huge upside potential, so this is a huge positive for Quarkchain.

Token Sale details

Token Distribution details

Token Value in the long run

QKC is an integral part of Quarkchain and its value in the long run will come from the following:

• As a value carrier – the essense of virtual currency is the value carrier, which is the most important attribute of QKC.
• As a transaction currency – QKC is the primary mode of payment on the Quarkchain network to fuel transactions (pay for mining).
• QKC will also be used as incentives to encourage the community towards continuous contributions, which is great from a long term perspective.

Hype and social Media

Quarkchain gets a thumbs up on the social media hype.

Telegram has 84000 + members (review - very good)
Twitter has 14500+ followers (review - very good)
Medium - They have removed their presence from Medium and moved to Steemit.
Steemit - 370 followers (review - could be better)
Reddit - 580+ subscribers. (review - good)
Bitcointalk.org - There is some buzz in the forum, but not as much as i would have expected.
Facebook likes and followers - 290+ likes and 350+ followers (review - average)

Roadmap

Quarkchains scores low on its roadmap.

Quarkchain has published its roadmap in the whitepaper. Quarkchain is a new project and they are already inviting technical community to join their testnet in May 2018. It does seem like they are moving very fast. That is pretty much the only good sign I get here. I would have preferred the roadmap to be more detailed.

Also i was not able to get access to github, so they are a closed project at this time, and maybe i am not looking at the right place (not that i intended to review their code). I do seem some contributions to github. I would let the more technical folks do a deep dive and understand this better. I dont have enough information here.

Competition

The only formidable competition out there for Quarkchain as on date is Zilliqa. If Ethereum implements its sharding solutions then it will not just be competition, but a killer to both of the above, but from what i understand, Ethereum has a long way to go before it implements sharding in its live blockchain and that gives plenty of time for Quarkchain and Zilliqa to exist and fight for the market share.

From what i have read so far Quarkchain triumphs Zilliqa by the following:

• Quarkchain supports both network and state sharding (based on of the links i have in reference)
• Quarkchain support cross-shard transactions
• Quarkchain supports EVM and the Turing complete language, Solidity, for coding its smart contracts.

Summation of Quarkchain ICO review

Overall Quarkchain comes out as 2018's one of the top blockchain ICOs and a serious competitor to Zilliqa. Though Zilliqa has a head start, it may just be a race to finish and must be watched with all focus.

If Quarkchain delivers on its promise and so does Zilliqa, still Quarkchain would be a top contender as it supports the Ethereum VM and uses solidity to code the smart contracts which makes Dapps on Ethereum easier to transition to Quarkchain.

Trying to get this on exchanges may be tough as the price would sky rocket by then. On exchanges i would look for dips to get this, but i would also watch their progress in Github carefully before buying on exchanges. Net net it is an ICO I would be participating it. I see a good potential for both flipping as well as long term.

Key terms and words that epitomize the Quarkchain

• Permissionless public blockchain
• 2 layered blockchain with root chain as one layer and multiple shard chains as the other layer.
• Flexible 2 layers where hashpower can be assigned to rootchain, shards or both. Quarkchain will have 50% hashpower allocated to rootchain (but this is flexible).
• High on scalability and performance.
• 100,000 TPS (some claim even 1 million, but i could not see this number in their whitepaper)
• Highly secure through evenly distributed hashpower across shards and 50% hashpower for root
• Intelligent sharding technology for elastic shards and resharding
• Enables on-chain, off-chain and cross-shard and cross-chain transactions
• Proof of work consensus for root chain and root first proof of work consensus for shard chains.
• Decentralized mining with Collaborative mining incentives
• Friendly to miners with less hash power and allowing clustering of smaller node to form super nodes.
• Smart account management feature
• Smart Wallet functionality
• Support for Turing complete language (Solidity) for coding smart contracts
• Uses Ethereum Virtual machine (EVM)

Ok, you can stop here if Quarkchain ICO review is all you wanted, but if you need the details to understand Quarkchain much better, please humor me a little more and read on till the end.

A disclaimer is necessary before i attempt to explain Quarkchain.

Disclaimer #1 - Right at the onset of whitepaper Quarkchain makes it clear that all its claims are forward looking and all possible risks and uncertainities apply to it and that no one should base their decision on anything that is in the whitepaper. Like quarkchain makes it clear, so do I, that whatever i state in this article is from their whitepaper (including the images) and since whitepaper is not to be used for decision making and also all references in the whitepaper are for illustrative purposes only, I am not sure how much of these claims can be relied upon for now.

So with that said, i go on to review Quarkchain in more detail (if you were open to the scenario, “what if the claims were true”, then it may just make up for a very interesting review, so stay with me till the end of this review, else you may just exit now).

What is Quarkchain

In the whitepaper i find the sentence, The altimate goal of the blockchain is to extend scalability as high as possible while keeping security and decentralization at an appropriate level, and Quarkchain seems to use this as their guiding principle for developing a fast and scalable blockchain.

Quarkchain is a permissionless blockchain supporting 100,000+ TPS on-chain transactions. Quarkchain desires to be the blockchain that supports enterprises needing high throughput support for their transactions. Typical use cases of Quarkchain network would be to build distributed social media apps, high frequency trading, Internet of things (IoT), gaming and payment (and almost everything that one may want to build on a blockchain :-)).

What exactly is Quarkchain solving

The current blockchains are choking when throughput needs are increasing. Any attempt to improve the situation results in a compromise on security, scalability or decentralization which are the core pillars of a public blockchain network. Also the current proof of work mining algorithms are unable to solve centralization issue.

In May 2018 the top 6 mining pools controlled 75% of overall Bitcoin hash power (https://blockchain.info/pools).

Also due to low performance and centralized pool mining, miners are charging high transaction fees (and cherry picking the transactions, that pay most, to be executed first). Miners have no incentive to validate transactions with low fees. In the last six months the fees on Ethereum has sky rocketed.

Quarkchain understands that there will be some compromise and you can't solve for all 3 pillars of blockchain. If more security / privacy is needed (like in Monero coin), then scalability will be impacted due to the high storage needs that come with such solutions.

Quarkchain attempts to solve for scalability as that is the most important factor that will allow blockchains to support the global e-commerce needs, while at the same time balancing the needs of decentralization and security.

Quarkchain achieves its objectives by offering a set of features while keeping intact its design philosophy, which is:

1. Enhancing scalability while balancing security and decentralization
2. Enabling seamless cross-shard transactions
3. Simple account management for clients
4. Open standards to support various Dapps
5. Incentive-driven ecosystem

How Quarkchain is balancing the 3 core pillars of the blockchain while focusing on scalability:

• Scalability - Advanced sharding technologies to achieve TPS of 100,000 and more.
• Security - Though an attacker only needs 25% hashpower to compromise the system, unlike bitcoin where attacker needs 51% hashpower, Quarkchain claims that it is more secure through 2 factors.
  • Attacker would need to compromise both the shard and the root chain to compromise the system
  • Quarkchains incentive mechanism makes mining decentralized (unlike bitcoin where top 6 pools hold 75% of hashpower) and therefore seeking 25% hashpower is more difficult than in bitcoins case.
• Decentralization - Quarkchain has an incentive mechanism where miners can form clusters and in turn super nodes. Miners will able to collect their reward without having to resort to pooling. Shards are created for scalability and therefore transactions will move to new shards if there is any increase in price and so will miners.

Lot of the above stuff can be better understood once we understand Quarkchains features explained below.

Features of Quarkchain

Reshardable 2 layer blockchain

Quarkchain has 2 layers. The first being the shard chain and the second being the the root chain. Any blockchain has 2 purposes. One is ledger and the other is confirmation of the transactions.
The shard layer provides for ledger alone and the the root chain only provides for confirmations. This allows shards to process transactions in seconds and new shards can be created whenever scalability needs increase. The root chain confirmations take minutes as it has to perform the computationally intensive consensus algorithms.
One question that would come to mind is that rootchain seems similar to any other proof of work blockchain and that would be true if all hashpower was allocated to root chain and there would be no shards in that case. Quarkchain allocates 50% hashpower to rootchain to maximize the difficulty of double spending.

Consensus Algorithms

Quarkchain uses different consensus algorithms to ensure both security and speed.

• Root chain uses PoW just like bitcoin or Ethereum
• Shards uses root-chain-first PoW consensus algorithm. What this means is that if there is a fork in shard chain, then first the root chains are considered and the longer rootchain wins irrespective of the length of the forked shard chain.

Guaranteed security by market driven collaborative mining

Quarkchain has designed its algorithms to ensure incentives for collaborative mining. Quarkchain has several minor blockchains (shards) and one main root blockchain. Each blockchain offers different incentives and difficulties. Miners could choose any blockchain at an optimal price of their hash power. This creates an open market economic model and since miners can match their needs with that of the confirmation difficulty, there is less incentive to be part of mining pools.

Key takeaways

• With an opportunity for collecting rewards miners will distribute their Hash powers evenly among shards. This ensures that all shards are mined evenly and thus the system throughput increases as shards increase. One nice example i read was how once a shard reaches its throughput a new shard will be created. Users will move their transactions to new shard as using a busy shard will only increase their transaction costs and miners will mine on the new shard as it increases their chances of collecting rewards.

• The root chain has significant large portion of hashpower (more than 50%). This prevents double spending and a malicious miner needs 50%50 = 25% hashpower of the whole network (bitcoin needs at least 51% hash power for an attacker to succeed, but since mining is collaborative collecting even 25% hashpower will be difficult on Quarkchain).

The hashpower for root blockchain can be adjusted.

Anti-centralized horizontal scaling

The network bandwidth and storage requirement of running a super full node for a high throughput blockchain are high and this may lead to large players centralizing the mining process. To overcome this Quarkchain encourages clusters where multiple honest nodes in a cluster can run as a super node. Each node runs only a sub-set of chains and the only requirement is that between the nodes of the cluster they should be able to validate the root chain and the shards.

Efficient On-chain, off-chain, cross-shard and cross-chain transactions

Quarkchain supports both in-shard transactions (where input and output addresses are in the same shard) and cross shard transactions.

Cross Chain transactions

Quark chain treats cross chain transactions as cross shard transactions by either converting the tokens of other blockchain using adapter and treating the transaction as a Quarkchain transaction or by adding the other blockchain as a shard chain under Quarkchain, effectively making it a Quarkchain cross-shard transaction.

Off-chain transactions
Quarkchain also supports off-chain transactions where application needs to interface with external data not available on the blockchain. This will make it ideal for many enterprises needing high throughput blockchain and also access to external data that they do want to port to the blockchain.

With this feature Quarkchain is also attracting enterprises to its blockchain. This is a powerful feature and may just win it for Quarkchain. What remains to see is how this scales to what Edenchain is offering as Eden is mostly focusing on this one aspect to help it win the blockchain race with enterprises. What an interesting times we live in. Lets watch these 2 projects very closely (with a keen third focus on Zilliqa as well).

Simple account management with smart wallet functionality

Quarkchain allows users to interact with other users / smart contracts and run transactions in any of the shards from a single account and users a smart wallet to perform the in-shard or cross shard transactions without users having to be aware of this detail.

User needs as many addresses as there are shards. Since shards can be many, this becomes a non trivial task to maintain so many accounts. Quarkchain maintains one primary account and multiple secondary accounts. All transactions are routed through primary account and where necessary, balance is moved to secondary accounts for transactions and once done any unused balance from secondary account is always moved back to primary accounts.

The smart wallet will have two types of typical transactions

• Transfer of tokens – smart wallet automatically detect primary account of user and perform the in shard or cross shard transactions

• If a smart contract exists in shard other than where users primary account resides then smart wallet will automatically transfer tokens from primary account to the secondary account in a shard where the smart contract runs and post transaction the smart wallet automatically moves any unused balance back to primary account

Turing complete Smart contract platform

Quarkchain Supports smart contracts via the Ethereum Virtual Machine (EVM). Its uses Solidity for writing smart contracts. Not only is Solidity a Turing complete language and already popular for writing smart contracts (all smart contracts on the Ethereum network are written using solidity), but it also allows existing Dapps on Ethereum to migrate to Quarkchain easily.

This is a strong case for Quarkchain if it achieves its scalability solution ahead of other blockchains.

Quarkchains plan on expanding its business.

Mobile first approach (DApps2go) & encouraging startups.

• Quarkchain is going with a mobile first approach and calls it mobile Dapps Dapps2go. Quarkchain believes that mobile Dapps are the way foward and to foster the same it will be providing on-chain developer tools to create an Android friendly environment to make creating Dapps2go simpler. It will also privide QKC as incentives to developers creating apps on its network.

• To further help developers Quarkchain is adopting a build-measure-learn loop from the lean startup methodology and thus developers will be able to test their minimum viable product with ultra smooth and fast experience.

Enterprise friendly

• Quarkchain network is looking forward to partner with business from each industry segment where high throughput of its blockchain will maximize the business utilization.

• Due to its high speeds Quarkchain is also ideal for IoT solutions, ticketing / reservation systems (public transportation systems) etc.

Buzz words AI and Big data also make it to Quarkchains plans. Hurray!!

• Quarkchain network has the functionality of reshardability which is power by AI (through reinforcement learning the transactions can be grouped into same shard or closer shards to achieve lowest transaction costs possible). It is not clear though at this time how Quarkchain will achieve this, but anything with AI in it really sounds exciting to anyone (blockchain or otherwise)

• Quarkchain is also looking to support big data analytics for businesses. There is not much details on Quarkchain will about with this, but big data is again another buzz word people are very keen to hear for a new startup company. S

Reference Section

For the review i went through the following, though not limited to only these.

Quarkchain whitepaper
https://www.quarkchain.io/QUARK%20CHAIN%20Public%20Version%200.3.4.pdf

Quarkchain token sale terms and conditions
https://quarkchain.io/QuarkChain-Token-Sale-Terms[EN-ZH].pdf

Quarkchain whitelisting and KYC process -
https://steemit.com/quarkchain/@quarkchain/quarkchain-whitelisting-kyc-process

Quarkchain Bounty Process (for submitting your article or video on quarkchain)
https://steemit.com/quarkchain/@quarkchain/bounty-program

Review on Quarkchains TPS claims
https://cryptobriefing.com/quarkchain-code-review-deep-dive/

ICO review
https://crushcrypto.com/quarkchain-ico-review/

ICO review with a detailed caution section
https://cryptovest.com/reviews/quarkchain-ico-review-aiming-to-change-the-cypro-economys-entire-trajectory/

Quarkchain Vs Zilliqa
https://steemit.com/quarkchain/@madsale/quarkchain-the-zilliqa-killer

Why Quarkchain team is stellar
https://steemit.com/blockchain/@dutchdeliverance/quarkchain-advisory-team-review-excellent-choice-and-i-ll-explain-why

Interesting articles on sharding (since Quarkchain and Zilliqa are all about sharding)
https://bitcoinmagazine.com/articles/op-ed-many-faces-sharding-blockchain-scalability/

(for the technically more inclined)
https://blockgeeks.com/guides/what-are-ethereum-nodes-and-sharding/
https://github.com/ethereum/wiki/wiki/Sharding-FAQ
https://medium.com/@icebearhww/ethereum-sharding-and-finality-65248951f649

Disclaimer #2 - I am only sharing my limited knowledge and for the sake of
knowledge alone. This is in no way an investment advice or legal or taxation
counsel. I am not qualified to provide any of these. This is also not a
recommendation or encouragement to invest in cryptocurrencies or ICOs