The topic of securities and the prospect of ICOs, existing ERC20 tokens, and Ethereum itself as a security has been a large focus of discourse in the crypto community. That discussion has been plagued by negative connotations and the fear of the regulatory system crashing down on crypto and ruining everyone’s fun. Others are taking a different view on securities and the prospect of having them in the crypto space. One such project is Polymath and today I’m going to be examining what Polymath’s goals are, the meaning behind those goals, and what we can expect from them going forward.
Polymath is a platform for trading securities tokens. They will make use of the blockchain and their own token POLY in order to accomplish transfers and listings on that platform. The idea behind the project is quite simple. ICOs have become incredibly common and also incredibly risky forms of investing in new projects. Due to that high risk many government agencies (as we are all aware) are on the look out to protect investors from potential fraud. The idea of the SEC or CFTC coming in and fining hundreds of projects or investors is not on anyone’s wish list, so Polymath is looking to take the bull by the horns and offer legal security services that are fully compliant with current regulation.
Polymath is looking to do a couple of awesome things with its platform. They want to create the security token offering or STO and create the processes for tokenizing the securities market in a legal and compliant fashion.
To accomplish that task Polymath is offering a suite of services to those wishing to issue their own security tokens and to those wishing to purchase those securities. It should be noted that the primary development by Polymath will be with their blockchain, the POLY token, and the creation of the smart contracts to make that possible. Many of the functionality that a user will directly interact with will be outsourced to partners.
The first of those outsourced processes is the Know Your Customer process which is critical for the purchasing of securities due to regulatory compliance. That KYC process will be required for any individual or institution that wishes to be involved in the securities market. The verification of the KYC will be performed by SelfKey and the fee for that service will be paid in POLY tokens.
Another interesting process provided by Polymath will be the linking of those wishing to issue a security token with developers who can make that happen. I would imagine there are quite a few groups or institutions that would like to make a security token but have no idea where to start in terms of both regulation and programming. Polymath will solve both of those issues.
Now the cool part of Polymath is what is actually being traded through the platform and that’s securities. Securities are an asset class that represent a roughly 10 trillion dollar market and are what most people think of when someone mentions the term trading. Securities on the Polymath platform can be anything from stocks or bonds to physical assets like metals or real estate. These assets have not been “tokenized” yet but Polymath foresees that these assets and the security token asset class can be the next “big thing” with cryptocurrency and the way to onboard capital into that system will be through the Polymath STO.
The STO will be like an ICO in today’s world except the offering will be for a security backed token and not a coin or a utility token seen with Ethereum ICOs. In the process of that STO Polymath is going to be connecting those wishing to offer the security with lawyers, the KYC provider, investors, and developers. The issuer of the security will have all the resources necessary to make sure that they are regulatory compliant and have access to a huge pool of potential, legal investors thanks to the KYC requirements of Polymath.
In addition to the STO, Polymath will provide the processes for “tokenizing” these assets in a way that they can be legally owned and traded. To accomplish that they have the ST-20 standard which amounts to the ERC20 standard with a verification step to the process that makes use of the KYC to ensure those buying and selling are legally able to do so. That transaction of trading the tokens will occur on a secondary market which will be run by the Polymath partner tZERO.
Overall, that’s all the cool parts of how Polymath is going to function. I hope that provides a great overview of the ideas and concepts behind why Polymath is such an intriguing process.
Polymath doesn’t have a released roadmap, but has referred several times to an “internal roadmap” that they are using to guide their actions, so what I’ll be doing here is tackling some of the recent accomplishments of the team. One of the most important developments related to Poly in the past couple months is the launching of the OpenFinance Network on June 28th. That is the first exchange for trading tokenized securities and will be a place where Poly STOs will be traded following the offering period. tZERO, the partner I listed above for trading, is still in a fund raising process which was extended to August 6th.
In terms of development for Poly they released a core functionality update on June 21st adding additional STO functionality. In terms of STOs themselves, Polymath announced that they would be partnering with MintHealth to launch the first healthcare security token. The Minthealth MHST token would award holders with equity ownership.
POLY is currently trading at a price of $0.35 or 4312 Sats or 0.00076005 ETH. Total supply of the token is 1 billion POLY and the circulating supply is 276 million. Given those numbers the market cap for poly is just a hair shy of $100 million. Volume for the past day for POLY was at $3.7 million.
POLY is traded on a number of exchanges with the most important being Bittrex, Uptbit and Ethfinex. Bittrex occupies the top spot for POLY trading with 31% of daily volume on its BTC pairing. Upbit comes in second and third with its BTC and KRW pairings that have 17% and 16% daily volume respectively. Lastly, there is Ethfinex with an ETH pairing and 11% daily volume.
Bittrex — https://bittrex.com/
Upbit — https://upbit.com/
Ethfinex — https://www.ethfinex.com/
To learn more about the Polymath project please see the following links.
Website — https://polymath.network/
Twitter — https://twitter.com/PolymathNetwork
Whitepaper — https://polymath.network/whitepaper.html
Polymath is a project that is looking to bring a lot of pieces together in order to tokenize a gigantic asset class in a legal and compliant manner. Their success or the success of others attempting this feat would mean securities could be tokenized safely without the fear of kneejerk regulatory reactions from agencies like the SEC. That alone would add stability to crypto aside from the huge amount of new capital.
Thank you for reading today’s article! I spent a lot of time reviewing how I wanted to present the information as I wanted this article to be of same value besides rotely repeating the 4 different types of actors in the Polymath system like all the other ones. I hope that I was able to give a valuable account of the project and whet your appetite for its future! My next article will be released on Friday and will be covering the project VeChain. As always follow me on here or on Twitter @thant1194 or on InvestFeed @thant11 in order to remain up to date on all my articles as I release them. I am not associated in any way with the Polymath project and I am a holder of the token. Thank you again for your time! I have to return some video tapes.
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