"There's always a bull market somewhere," "Mad Money" host Jim Cramer once famously said.
Perhaps truer words have never been spoken, as a cryptocurrency called QNT, the native token of interoperability-focused Quant Network, has come out of oblivion with a staggering 450% jump in four months, decoupling from the broader market lull.
QNT was the only top 30 coin boasting an overbought status – a signal flashed by a popular technical analysis tool called the relative strength index (RSI), indicating strong upward momentum. That's an envious achievement, considering the broader market has shown little signs of life since the May-June crash.
An RSI above 70 implies overbought conditions, while a reading under 30 suggests the asset is oversold. The RSI is a momentum oscillator that measures the speed and change of price movements.
Founded in 2015, Quant Network uses Overledger technology – an interoperable blockchain operating system – to facilitate interaction with different public and private blockchains simultaneously. The QNT token is used to pay fees to access the technology. The token's maximum supply is capped at 14.6 million.
While QNT's daily chart RSI stood well above 70 as of writing, bitcoin's RSI was directionless below 50.00.
Retail traders often misread an overbought RSI as a sign of an impending bearish reversal. However, that's not necessarily the case. An above-70 or overbought reading indicates the asset has moved too high too quickly and there could be a temporary bull breather.
QNT's rally is backed by an increased accumulation of coins by address owning 100 QNT and 1,000 QNT, dubbed whales by blockchain analytics firm Santiment.
The number of QNT held by the whale addresses has increased from 1.47 million to nearly 1.7 million in four months.
The sentiment is quite bullish on Crypto Twitter, with some handles saying the token is still cheap.
While it's difficult to pinpoint the exact catalyst for the bullish trend, circumstantial evidence suggests that the launch of "tokenise" at the end of June likely galvanized investor interest in the cryptocurrency. Tokenise allows users to create and deploy interoperable QRC-20 tokens (Ethereum standard counterpart) and digital assets onto mainnets.
Further, On Aug. 22, Quant Network announced a non-fungible tokens (NFT) standard called QRC-721 to help users build and deploy secure, interoperable NFTs and overcome limitations associated with Ethereum's ERC-721. According to Martin Hargreaves, Quant's chief product officer, the ERC-721 tokens lack interoperability and have been subject to hacks.
Lastly, the belief that Quant Network, with its interoperability feature, would play a pivotal role in building central bank digital currencies may have contributed to the rally.
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