This is more of a theory than a claim. I'm open to any contrary opinion or facts I could be forgetting.

Imagine two players. Their true ranks is high plat and they are both climbing for the first time. They are gold atm and this is the highest rank they've achieved.

The first player is match mvp 9 out of 10 times. He tries his best, carries as much as he can. The second player is never match mvp, plays while listening to music, couldn't care less.

The system knows that the first player is actually high plat. And despite the fact that he's still in gold, his lobbies are mostly plat3-d3. Sure he gets a lot of points for winning, but his win rate is 50%, since there's a bunch of d3 in his lobbies.

The system does not know the true rank of the second player. It could think he's somewhat plat but he's average while in gold so he could be in his right rank. His lobbies are mostly gold and low plat. His games are easy and he could be getting match mvp if he was paying any attention to the game.

So when the rank up game comes, the first player is tested against diamond and the second player is tested against plat. Since they are both (actually) high plat, the first one loses, the second one ranks up.

Which is why we see such a huge difference in skill within the same rank. You have silvers who are HS machines getting MVPs in high gold-low plat and that dude you have no idea how they reached diamond.