Interview with Graeme Moore — VP of Marketing, Polymath Network
We continue to publish a series of interviews with team members of projects which seem the most promising today. This week we talk with Graeme Moore — VP of Marketing, Polymath Network.
After posting our detailed report on Polymath project, we have decided to take an interview with the project representative — VP of Marketing — Graeme Moore. This interview brought us to make some changes to the initial report, get to know more on legal part of the company and just have more clear idea of the Polymath Network.
What stage are you with testnet and mainnet?
We released mainnet in January of this year (although it was a very basic version). Our updated release of mainnet is out now. Idea: Really good one, but not original. We are the first to ever have this idea. Link to our dApp can be found here: tokenstudio.polymath.network
Thank you for your reply! Just wanted to double check, if mainnet was in January how can you comment on this response?
Good research! Well, what was launched in january was very, very basic. When people are asking for mainnet, what I assume they are asking is when is your dApp available to be used. And our dApp is now live on Ethereum mainnet.
Also, you have announced 5 STOs in the upcoming 3 months, are they going to be legal compliant (when buying these tokens will the buyers legally own a part of the company)? If so, are there going to be any additional documents proving ownership? Or smart contracts would include all the legal issues and owning a token will be enough t0 proof ownership?
The STOs will be legally compliant. The companies are issuing actual financial securities, represented as tokens.
There will be additional documents proving ownership. All of the same filings and regulatory documents that a company would need when issuing a security will be used here.
How will voting governance be processed by tokenized companies? How will investors participate in it? Will they form board of directors?
Voting can be done however the company sees fit. We do not yet have the technology to allow this to happen on chain, but it is something we are looking to build into the Security Token Standard.
Do you already have audit companies on board?
In terms of code, yes. All of our code, along with the STO contract that issuers can use, is audited. In terms of auditors that would audit financial statements, that is something an issuing company takes care of themselves. We are not involved in that process.
Do you have a ready pool of KYC providers? Which countries are covered? What is the first target market?
Yes. We have partnerships with Identity Mind, SelfKey, and Katipult. I am not 100% sure on the countries that these providers cover, but I can guarantee they cover North America. We are actively looking to create partnerships with all reputable KYC providers to give companies using the Polymath platform the best options available.
How will STO tokens be limited in transactions between 3rd parties? Will they be able to trade them OTC?
ST-20 tokens have built-in transfer restrictions. Only people who have been KYC verified and authorized to hold tokens can hold tokens. They can be traded OTC because the transfer restrictions are built in at the protocol level.
Can you please also elaborate on what legal permissions did you receive to conduct STO? What makes your smart contracts legal? Did you obtain any kind of licence and from US regulatory bodies?
ST-20 tokens have built-in transfer restrictions that only allows authorized investors who have been KYC/AML verified to hold them.
Companies using the Polymath platform should engage legal counsel in order to do all of the necessary legal and regulatory work in order to conduct a sale of securities. It is up to a company issuing securities to ensure they are regulatory compliant.
You said that companies have to register securities themselves. How Poly simplifies the process then?And if company registered securities, why can’t they be traded on a regular exchange without issuing a token? Do you somehow simplify registration process for them?
We simplify the process of creating the security, along with providing warm introductions to any of the third parties an issuer might need in the securities issuance process (legal firms, KYC providers, broker-dealers, custody providers, transfer agents).
Oh, that’s great. Would it be much more difficult for these 5 issuers you have in the following months without you?
Yes, incredibly difficult and time consuming.
Most of the companies that are excited about Polymath and security tokens are looking to issue private securities. Today, there are no well-functioning secondary exchange markets that provide liquidity for private securities.
This is because private securities are pieces of paper. They are hard to trade. They are not programmable.
We provide a seamless process where a company can create a security, which can subsequently be listed on a functioning exchange to provide their investors with liquidity.
With that being said, there are still companies excited about Polymath who are looking to do a public offering. This is because the costs associated with creating security tokens and having them listed on secondary exchanges is much cheaper than the legacy route.
Don’t they have to go through the same legacy route? What makes it cheaper as companies have to obtain same legal documents. How is the process simplified exactly besides the fact that you introduce to “legal firms, KYC providers, broker-dealers, custody providers, transfer agents”?
Listing fees (if there are any) on a security token exchange are nowhere near this price.
There are two ways to look at the benefits:
1: Security Token vs Paper Share Certificate
2: Polymath vs Trying to Create Your Own Security Token
1: To create: Roughly the same cost, but your securities can have a functioning secondary market with liquidity
To list and trade: Much cheaper. Listing fees much lower. Trade fees much lower.
2: To create: Much cheaper, because we have done all of the tech work for you. You do not have to find a developer. Make sure that developer is trustworthy. Negotiate a contract with them. Ensure their work is good. Have their code audited. And then make sure that what they built is compatible with the technology that exchanges use. We have taken care of all of that.
To list and trade: Possibly the same, but a security token created by a random developer may never be traded in a secondary market, because an exchange may not have compatible technology.
Does that make better sense now?