Qtum (QTUM), a smart contract blockchain platform, serves as a value transfer protocol with the functionality that integrates the major strengths of both Bitcoin and Ethereum.
What Is Qtum?
Qtum is created on the basis of Bitcoin’s UTXO model, and it utilizes the proof-of-stake consensus mechanism. In addition, it has integrated Ethereum’s functionality for smart contracts and dApps. The platform also supports DeFi applications, and more than 20 tokens are created on the Qtum blockchain. One of Qtum’s major innovations is its account abstraction layer that contributes to the development of extended smart contract capabilities. Qtum’s applications are especially popular in such segments as search engines, decentralized games, and social networks. Qtum demonstrates several times higher productivity and scalability than Ethereum, making it the optimal choice for many decentralized projects. The on-chain decentralized governance allows integrating the perspectives of different stakeholders, thus reaching a general consensus on the major practical questions.
QTUM’s current market price equals $4.15 with the circulating supply of 104.2 million tokens. Its total market capitalization is $432.5 million, making it the 96th largest cryptocurrency in the market. Its maximum supply is 107 million tokens, implying that only about 3% of the total supply can be issued in the following several years. QTUM reached the historically maximum price at the beginning of 2018 with the serious decline in the subsequent years. However, it demonstrates the signs of revival in the past few months. In case the project continues to develop with the introduction of new functionality, its market performance may also demonstrate positive dynamics. The introduction of new unique features beyond those used by Bitcoin and Ethereum is crucial for reaching the maximum loyalty in users.
Figure 1. QTUM’s Integration with BTC and ETH; Data Source – Gemini
Investing in Qtum: Pros and Cons
Investing in Qtum is associated with considerable risks. The reason is that the competition in the dApps segment continues to increase rapidly. Moreover, the project reached its maximum capitalization more than 4 years ago with a significantly declined interest among strategic investors. At the same time, Qtum’s developers tend to offer some new governance and functionality solutions that can be potentially appealing to many members of the crypto community. Moreover, the current price level is also favorable for purchasing tokens close to their local minimum. Thus, the utilization of technical analysis may assist in making better-supported investment decisions in the vast majority of cases.
Figure 2. QTUM/USD Price Dynamics (3-Months); Data Source – CoinMarketCap
QTUM’s current price is close to the local minimum of $3.2 reached several weeks ago. At the moment, QTUM’s price tends to gradually restore with the first main target being $7.3 that refers to the significant resistance level. If the positive trend persists, this level can be reached within one month. The second resistance level is at the price of $9, but it cannot be reached in the near future if the general crypto market dynamics remains unchanged. Overall, the investments in QTUM may be reasonable if they are realized within a broader portfolio investment strategy.