Polymath: Detailed review on the project
After taking an interview with the project representative — VP of Marketing Graeme Moore we’ve updated our report which now includes datails on the legal part of the company, new Ethereum token standard ERC 1400 and launch of 5 STOs in the coming months on the Polymath security token issuance platform.
The Polymath platform is designed to lower the barriers for businesses and issuers of financial products to launch security tokens on the blockchain. By introducing the tools for a simple marketplace for securities issuances and secondary trading, the Polymath platform can help bridge the gap between traditional securities and blockchain-based asset ownership and investment opportunities.
Polymath presents an open protocol for issuers, intermediaries, and participants to issue and trade security tokens, and could ultimately help usher a complex, global, regulatory landscape onto the Ethereum blockchain. If this technology can lower the barrier to entry, it could help spur economic growth and opportunities to more people and in more places than ever before.
With the multi-trillion dollar securities industry coming to the blockchain, the Polymath platform provides technological tools for individuals and companies to participate in valuable blockchain-based asset ownership and investment opportunities.
When I was writing first review on Polymath technological aspect of Polymath project was quite weak. Low number (11) of contributors on github and not that much activity overall. Out of 11 contributors 1 is multiacc (SatyamSB is main, satyamakgec is sub), and almost all of the core’s code is written by 2 developers, which is quite strange. It is understandable, that this project makes much bigger emphasis on legal aspect, not technical aspect, but such low activity and small number of active developers is a sore point if you look at the size of the management team.
But quite a lot of improvements were made by this project. Activity rose considerably, 1 more active contributor appeared, new standard ERC 1400 was proposed and by the creator of ERC-20, you 2 new versions of core was released, 5 new STOs were announced to be released. So past few months were really busy for Polymath team.
Whitepaper wasn’t updated, still has long introduction to “history” of blockchain, but short “on topic” part. It has an issue, it has proposals on that issue, it has some technological basis, some algorithms description (though not in detail), it doesn’t have info on consensus or future mainnet, but quite a few examples of how different entities are supposed to communicate with each other.
1. Trevor Koverko — Co-Founder & Chief Executive Officer.
Trevor Koverko is prominent blockchain founder, investor and speaker.
After launching his career at the convergence of Wall Street and Silicon Valley, Trevor became a very early leader in the blockchain community.
Trevor has keynoted major blockchain events like The North American Bitcoin Conference and seeded foundation projects like Ethereum, Aion, QTum, Hive, EOS and Shapeshift. Also Trevor is an advisor to OneLedger.
In 2017, after predicting the mega-trend of financial securities migrating to the blockchain, Trevor cofounded Polymath — the world’s largest securities token network. Trevor graduated from Canada’s leading business school, Ivey, was an NHL draft pick of the New York Rangers and is a 4x attendee of Satoshi Roundtable.
2. Chris Housser — Co-Founder & Chief Operations Officer.
- The University of Western Ontario (Juris Doctor, J.D., Law Degree).
- University of Victoria (Bachelor of Arts, BA, History).
3. Pablo Ruiz — VP of Engineering.
- Universidad Nacional de La Matanza (Computer engineer, Programming, Management).
4. Tracy Leparulo — Chief Events Officer.
- Ryerson University (Bachelor’s Degree, Marketing, Entrepreneurship)
- Untraceable Founder & Chief Executive Officer.
5. Graeme Moore — VP of Marketing.
- Queen’s University (BAH, Economics)
6. Igor Denisov — M&A and Strategic Partnerships.
- University of Toronto (B.A.Sc, Engineering science — Infrastructure, Finance)
7. Kalman Gabriel — Managing Director
- Slate Entertainment Group Inc. — Board Advisor
- University of Pennsylvania — The Wharton School (MBA)
- NYU Stern School of Business (Bachelor of Science, Finance)
8. Adam Dossa — Senior Solidity Developer
- Columbia University in the City of New York (Master’s degree, Computer Science (Machine Learning), 4.0 GPA
- University of Oxford (Bachelor of Arts (BA), Mathematics and Computation, 1st Class Honours)
- Enclaves — Founder
9. Boris Shevchenko — Lead Dapps Architect.
· City Business School (MBA, MBA General in IT Management)
10. Satyam Agrawal — Solidity Developer.
- Ajay Kumar Garg Engineering College , Ghaziabad (B. Tech, Information Technology)
- CEO, Co-Founder at SecureBlocks
11. Shannon Clarke — Developer.
- University of West Indies, St. Augustine Campus (BSc Upper 2nd Class Honours, Electrical and Computer Engeneering)
12. Thom Malone — Lead Designer.
- Bliss Flights — Co-Founder and CEO
- Global University (BA IN Teology/Theological Studies)
13. Ryan Keller — Sr. Project Manager.
- Cornell Johnson Graduate School of Management (MBA)
14. Lauren Hulvey — Executive Assistant Operations.
15. Matthew Woo — Product Advisor.
16. Stan Timofeev — Designer.
17. Thomas Borrel — Chief Product Officer.
Robby Dermody — Principal at Stoic Capital, Co-founder Counterparty.
Michael Terpin — Founder and CEO — Transform Group (75+ ICOs), CoinAgenda, Alphabit Fund, BitAngels, Marketwired.
Simon Dixon — CEO & Co-Founder BnkToTheFuture.com, FinTech Angel Investor, Author “Bank To The Future’.
Brad Mills — Partner at Xsquared Ventures, Analyst at Alphabit.
Steve Dakh — CTO at Smartwallet.
Erik Voorhees — CEO and Founder ShapeShift.io
David Johnston — Chairman of the Board at Factom, Inc.
Anthony Di Iorio — CEO & Founder of Jaxx & Decentral, Founder of Ethereum.
Steven Nerayoff — CEO & Founder at Alchemist.
Prolific serial entrepreneur, attorney and inventor of 20 international patents. Steven is a blockchain pioneer with his involvement in top projects including: Ethereum, Lisk, Bancor, tZERO, ZenCash, ZCash, Ripio, Aion and Storm. Steven is also the Chairman of the publicly listed company Global Blockchain Technologies and the Founder & CEO of Maple Ventures. Also he is the Founder & Executive Chairman of CloudParc. Previously founded: Freedom Eldercare, iOffer.com, Fleetwood Owen, eWanted.com, Inside/Out City Guides.
Patrick Byrne — CEO at Overstock.com.
Having gained familiarity with blockchain technology at the heart of digital currencies such as Bitcoin, Byrne created Medici Ventures, a subsidiary within Overstock.com building blockchain-based financial technology solutions. In 2015, Byrne used Medici’s t0.com securities trading platform to become the first person to purchase a digital bond entirely on the bitcoin blockchain. In Dec 2016, when Overstock.com issued the first shares ever traded on an alternative trading system (ATS) utilizing distributed ledger technology.
Stan Miroshnik — CEO & Managing Director at The Element Group.
Experienced capital markets, corporate finance, private equity, and operations executive in the blockchain and financial technology space. Expertise in digital assets, crypto-equity, and asset tokenization and directly with Ethereum, Bitcoin, Zcash, Cordia, and other side-chains and alt-forks. Management of blockchain focused product deployment and cryptocurrency applications over Bitcoin, Ethereum, alt and colored coins and other DTL driven innovation.
Anthony Di Iorio — The former Chief Digital Officer of the TMX Group and Toronto Stock Exchange, founder and CEO of Decentral and founder and CEO of Jaxx. In 2013, Di Iorio funded, and along with Vitalik Buterin and 3 others founded the smart contract platform Ethereum. In 2014, his project Ethereum raised $18 million, becoming the largest, completed crowdfunded project of its time.He is involved in Deloitte’s Exponentials.xyz initiative, is a member of the Bitcoin Speakers Bureau for the Bitcoin Foundation, a member of the Satoshi Roundtable.
Matt Roszak — Co-founder and Chairman of Bloq. Founding partner of Tally Capital, a private investment firm focused on cryptocurrencies and blockchain-enabled technology with a portfolio of over 40 investments, including Block.One, Blockstream, Civic, Doc.ai, Factom, Genaro, Orchid, Rivetz, Token Report and Qtum.Matt Roszak serves as chairman of the Chamber of Digital Commerce, serves on the board of BitGive, a non-profit foundation targeting public health and the environment. Roszak is also the founder of the Chicago Blockchain Center. Roszak was a producer of the industry’s first ever documentary, The Rise and Rise of Bitcoin.
Gary Rubinoff — Founder and Managing Partner at The WIN Fund, Founder and Managing Partner at Summerhill Venture Partners.
Gary brings over 25 years of venture investing experience. For the 9 years prior to joining Summerhill Venture Partners, Gary was a partner at J.L. Albright Venture Partners LP and Jefferson Partners LP, both Wireless and IT focused VC funds based in Toronto. Past investments include Jumptap, Intellon, Sandbridge, BridgePort, Service Soft, Isolation Systems, I-star Internet, and Wescam Inc.
Michael Perklin — Chief Information Security Officer at ShapeShift.io.
Michael serves on the boards of CryptoCurrency Certification Consortium (C4) and The Bitcoin Foundation, and he has testified about Bitcoin at the Canadian Senate’s Committee on Banking, Trade, and Commerce. Michael has been qualified as an Expert Witness in the courts of Canada and the United Arab Emirates. Michael is the president of C4, a non-profit standards organization dedicated to developing and maintaining standards that assist organizations in using blockchain technology such as Bitcoin.
Bruce Fenton — Blockchain Economic Advisor. Advised the Bill & Melinda Gates Foundation. Hosted the Satoshi Roundtable private retreat. Chairman and founder of the Dubai Bitcoin Conference.
- angel investor in SpeechWorks (now publicly traded Nuance with $5bn market cap)
- angel investor in Bitcoin companies such as ShapeShift
- advisor to Factom, BTCS and other companies.
June 1st, 2018: Reddit — about Polymath Team:
u/ddant10: “I just looked at Polymaths Team and in case I missed something, they only have 4 developers on board. Their engineer headcount seems pretty small to me for what they’re trying to achieve”.
u/LiskFTW: “Ivan on Tech basically said that the code is the easy part of this project. It’s building the network and working with the KYC/AML specialists, the Legal experts, the accredited investor pools, and the regulators that is the challenge”.
18th July 2018 — Polymath Partners with Shyft to Accelerate Global Financial Ecosystem Growth through Blockchain. Polymath has signed a Letter of Understanding with Shyft, a global blockchain-based network that facilitates secure sharing of attested and compliant data. As part of this partnership, Polymath would become an active ecosystem participant and data provider for the Shyft Network, acting as both a Trust Anchor and decentralized application (dApp) developer on the network. Full article is here.
19th June 2018 — MintHealth and Polymath Partner to Create the First Healthcare Security Token. Polymath, a highly automated and scalable platform that makes it easy to raise capital and create security tokens, and MintHealth™, a healthcare blockchain company combatting the worldwide epidemic of chronic disease through patient empowerment, improved clinical outcomes, and lower healthcare costs, have partnered to create the MintHealth Security Token (MHST). Full article is here.
7th June 2018 — Pegasus Fintech and Polymath Partner to Create Real Fan Token and Block Development Token on the Polymath Platform. Pegasus Fintech, a Blockchain and Token Accelerator that focuses on supporting innovative solutions in the Financial Services, Technology, Blockchain and Cryptocurrency communities is proud to announce it is advising two new projects set to create their security token offerings using the Polymath security token platform. Full article is here.
5th June 2018 — Polymath Partners With Security Token Trading Platform OpenFinance Network. Polymath has entered into an agreement to list Polymath-powered security tokens on OpenFinance Network (OFN), the trading platform for alternative assets, including tokenized securities. Full article is here.
25th April 2018 — Polymath Partners With CrowdfundX to Deliver AI-powered Investor Marketing for Security Token Issuers. Polymath and CrowdfundX, a company focused on AI-powered digital marketing, have agreed to pursue a collaboration to offer CrowdfundX’s digital marketing services to security token issuers on the Polymath platform. Full article is here.
19th April 2018 — Polymath and Trustroot Partner on Verification Service for Security Token Offerings. This partnership will allow companies who launch securities on Polymath’s platform to seamlessly have access to Trustroot security and reputation services. Trustroot will verify issuers, their escrow services, and accounts as they look to have investors contribute funds to their projects. Full article is here.
26th March 2018 — Polymath Partners With Crowd Machine To Boost Adoption Of Security Tokens. Polymath has announced a partnership with Blockchain startup Crowd Machine. This partnership will enable companies and developers to build blockchain-agnostic applications and smart contracts without needing to know how to code, enabling them to easily and safely interact with security tokens powered by Polymath. Full article is here.
7th March 2018 — Polymath Partners with Corl Financial Technologies on their Security Token. Our partnership with Corl Financial Technologies (Corl), a blockchain startup that is making financing and investing in companies simpler and more intuitive, sees Polymath further its work of discovering ways to help companies raise capital while complying with securities laws. Full article is here.
6th March 2018 — Katipult and Polymath named among industry giants as finalists for “Most Promising Partnership” Award. The Katipult-Polymath partnership will be competing against some of the world’s finance and fintech giants including partnerships involving Goldman Sachs (NYSE: GS), Macquarie Group (ASX: MQG), Swedbank (STO: SWED-A), and Lending Club (NYSE: LC). Full article is here.
11th January 2018. Security initial coin offering (ICO) specialists Polymath has announced a partnership with tZero. The Overstock subsidiary is currently hosting its ICO on SaftLaunch enlisting institutional investors for its security offer. Polymath has already provided advice to tZERO on the design, economic model, and distribution of tZERO’s security token, which will be issued under Reg D 506c — thus only accepting accredited investors in the US. Full article is here.
19th September 2018. Polymath, the platform that makes it easy to create security tokens, and Blocktrade.com, a top-tier trading facility for Security Tokens, Crypto Assets, Crypto Traded Indices and other Tokenized Assets, have announced a partnership. This partnership will see Blocktrade.com referring clients to Polymath, as well as Polymath and Blocktrade building compatible technologies to boost adoption and interoperability in the security token ecosystem. Full article is here.
7th September 2018. Polymath announced a partnership with Prime Trust, an SEC qualified custodian, that will see Polymath and Prime Trust working together to develop custody solutions for security tokens utilizing the ST-20 standard. Prime Trust is currently capable of providing custody of POLY, an ERC-20 token, and is looking to provide custody for ST-20 Security Tokens, which are backwards compatible with ERC-20 tokens. A unique feature of ST-20 tokens is that they have built-in transfer restrictions to maintain regulatory compliance with securities laws. Full article is here.
The Polymath platform’s main use case is that it will allow financial companies to create and issue their own tokenized assets (st20 tokens).
Main features of the Polymath project, presented in their whitepaper is listed below:
- Provides a decentralized protocol for trading security tokens.
- Enables individuals and institutions to authenticate their identity, residency, and accreditation status to participate in a wide range of security token offerings (STOs). Utility function: these are paid directly to service providers or part of it goes through the burning model. Devs, for example, have to hold their tokens received after STO success, as a bonus, for a minimum of 3 months. Rules for other participants of the ecosystem are not restricted in terms of payment for their services, e.g. KYC providers. Liquidity governance is not stated.
- Allows legal delegates to bid on new issuances to represent issuers on offerings to be done in a regulatory compliant manner.
- Matches issuers with developers who can translate issuers’ Security Offering parameters into secure code that generates ERC20 compatible tokens
One on their clients presents the process of creation of security token during the conference leaving questions about backend legal processes. Follow this link.
Polymath VP of Marketing commented on this matter as well in an interview:
“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.”
Markets and volumes
Not enough history to conduct technical analysis.
A tech stack for the next generation security token platforms.
Total securities market — 3 trillion dollars.
Harbor is building a decentralized compliance protocol to standardize the way crypto-securities are issued and traded on blockchains. The first project is R-Token, an open-source standard that defines a mechanism in which crypto-securities can be compliantly transferred on blockchains. It requires issuing a permissioned ERC-20 token on the Ethereum blockchain that checks an on-chain Regulator Service for trade approval. The Regulator Service can be configured to meet relevant securities regulations, Know Your Customer (KYC) policies, Anti-Money Laundering (AML) requirements, tax laws, and more. The R-Token Standard enables ERC-20 tokens to become compliant crypto-securities that can be traded across any ERC-20 compatible platform.
Amount Raised: $28M
Management: David Sacks, CEO, General Partner @ Craft Ventures, previously COO of Paypal, Founder of Yammer, CEO of Zenefits
Bob Remeika, CTO, VP Zenefits, Engineer at Yammer
Arisa Amano, CPO, VP Zenefits, Marketing at Yammer
Securitize is a regulatory compliant cloud service solution for the tokenization of securities, enabling tokenization of funds, companies, or other entities. The company provides several services including establishing the legal and regulatory readiness of the issuers and their legal team, streamlining investor registration in compliance with KYC/AML accreditation or other legal requirements, customizing smart contracts to match issuers’ unique requirements and security token data throughout the lifetime of the security. Spun out of SPiCE VC, the platform has secured commitments from companies running ICOs in aggregate of $500 million, including offerings from CryptoOracle, Kairos.com, Lottery.com and 22X Fund.
Management: Carlos Domingo, CEO and Chairman, Managing partner at Spice VC, Former CEO at Telefonica R&D
Jamie Finn, President, Former EVP Business Development Aki, AT&T, Kontera, Telefonica
Shay Finkelstein, CTO, CTO at SPiCE VC.
Templum is an innovative financial technology company focusing on creating a regulatory compliant marketplace for the primary issuance and secondary trading of digital assets through security tokens. Templum Markets LLC, broker-dealer and alternative trading system (“ATS”) registered with the SEC and FINRA, will offer issuers a platform for the initial sale of their tokenized securities and both issuers and investors a centralized platform for secondary trading. Like many other solutions, Templum will integrate AML and KYC as part of the platform to comply with regulatory requirements.
Amount Raised: $12.7M
Management: Christopher Pallotta, CEO, MD at Raptor Capital Management
Josef Schaible, COO, Former Director at Salt Lending
Securrency was founded in 2015 by national security experts and US military veterans. Today, it is comprised of a team of 80+ full-time professionals, with offices in Arlington, Virginia, Abu Dhabi, UAE, and footprints in London, Dubai, New York and Los Angeles.
The US-headquartered firm offers high-speed KYC/AML in 160+ countries, embedded distribution controls, market-making liquidity capabilities with bespoke tokenizing systems, interoperability with multiple DLT/legacy protocols, and an interlinked solution fostering unparalleled global liquidity. All products are available separately or as a comprehensive solution.
Management: Dan Doney, CEO, previously Chief Innovation Officer, Defense Intelligence Agency
Ron Poe, Compliance Officer, Captain U.S. Marines
John Hensel, COO, Retired U.S. Navy Captain, managed aerospace portfolios valued in excess of $15B
OpenFinance Network, the leading trading platform in the $7.7T alternative asset market, has developed a framework to transform the trading, clearing & settlement process in the industry, leveraging distributed ledger technology to bring efficiency, transparency, and interoperability to a fragmented market. The framework contains a uniform protocol to provide standardization of assets and data within the industry. Moreover, this interoperability also applies between “traditional” alternative assets and the emerging “crypto” alternative asset class, creating a mechanism of tokenized trading to bridge the gap between off-chain and on-chain capital markets.
Management: Juan M. Hernandez, CEO, Founder of PeerRealty, and the Pop Stock Exchange
Ian Shipman, Head of R&D
Polymath doesn’t have a detailed roadmap at this stage. They want to remain nimble and able to pivot on a dime if anything changes. Next milestone/goal is issuing 5 security tokens with companies
Token sale: 13 JAN 2018
First exchange listing: 2 FEB 2018
Mainnet released JAN 2018
Polymath Tokens (POLY)
In order to power this new platform for the issuance and trading of regulatory compliant securities on the Ethereum blockchain, an ERC20 standard Polymath (POLY) token will be created and distributed to network participants. One billion POLY tokens will be minted and no additional POLY tokens will ever be minted after that. POLY tokens are the underlying economic unit of the Polymath marketplace.
In whitepaper Trevor Koverko and Chris Housser state that “POLY token allows value created in the system to be captured by the system itself. Just as almost all countries have their own currency, requiring these transactions to be in POLY sets up incentives to remain in the system.” Which means you, as a person, hold POLY only because you have to make a transaction to participate in any STO and you:
1) don’t want to buy more expensive later or you are afraid of a rising price;
2) do this because you want to speculate on the class of people described in the previous statement;
3) don’t want to get late on an STO which will close in few hours;
4) will invest cheaper due to discount in security token prices for payment in POLY provided by agreement between STO-company and Polymath Network.
For example, the first 50 million Corl tokens purchased with POLY will provide a 20% discount to the Security Token Offering (STO) price. Other token can be purchased only with POLY.
“If all transactions were in ether (the native currency of Ethereum), then participants wouldn’t be storing value in the Polymath platform. By requiring that people hold (and transact) in POLY, participants become subject to the same forces of incentivization that have helped ecosystems like Ethereum (and many so called “alt-coins”) explode into active and diverse communities so that their products can remain viable and useful. Meanwhile, systems without their own native coin or with a “pegged” coin (e.g. Mastercoin) have struggled to develop growing or even sustainable communities or all-important network effects. In the following sections, POLY tokens are used throughout the platform.”
Issuers are able to post bounties in POLY tokens, in order to encourage legal delegates and developers to bid on providing services towards the issuance. The size of bounty posted is at the discretion of the issuer. Highly complex securities offerings will likely require a greater amount of POLY. Factors that will determine the complexity include issuer jurisdiction, investor jurisdiction, accreditation requirements, and token transferability limits. The higher a bounty the issuer places, the more likely it is they will receive a wider variety of bids from legal delegates and developers. Fees will generally be payable after a security token issuance and also upon enumerated events of payment. It is possible that, over time, efficiencies could make issuance less expensive.
Developers will earn POLY for creating STO contracts. In order to incentivize developers to create security token contracts, they will be required to have these POLY fees locked up for a minimum of 3 months after the end date of the security token offering. Fees will generally be payable after a security token issuance and also upon enumerated events of payment.
KYC providers pay a POLY fee to join the network. This fee is to identify legitimate KYC providers who can make this back in fees earned over time from investor verifications, potentially even after a single successful issuance. Furthermore, they can specify a fee to be paid by each investor requesting verifications (i.e. a set amount of POLY).
However, it doesn’t mean that fees would be somehow distributed to investors.
Investors seeking to purchase security tokens will be required to pay a POLY fee to KYC providers for verification. Verified investors are then eligible to trade security tokens, subject to any additional requirements imposed by their broker, by issuer, or by exchanges. Additionally, where not prohibited by law, investors’ payment for security tokens may be required to use POLY, but this is at the issuer’s discretion. Pure utility from investors to providers without any incentives to store token as a value are built-in.
Legal delegates are able to earn POLY tokens by (i) proposing bids on security token issuances and (ii) being selected by the issuer to take responsibility for the issuance. Along with their bids, they can specify how long they are willing to lock up their bounty.
All in all, token has no Store of Value properties as tokens in infrastructure projects or STO discounts for holders as Dragonchain’s Slumber Score. Burning mechanism is not provided as well.
Circulating Supply: 283 795 107 POLY
Total Supply: 1 000 000 000 POLY
Market Cap: $47 891 595 USD
24hr Volume: $1 933 307 USD
Team: strong management team, development team is still forming with ERC-20 creator developing new security token standard.
Idea: Really good one, original concept. Polymath has quite a number of competitors so it is interesting how they will try to achieve network effect, that of ICO’s. Projects like Polymath will get a huge market, but the question is how they compete for bigger market share. They are the first to work on the idea and can obtain first mover advantage as the first platform to hold STO. This project has a lot of hype as you can see looking at their ICO which collected 58,7 million dollars. But there are some weak aspects of this project as well:
a. KYC providers are only part of the ecosystem, not part of the company. For what reason would they want to be part of this project if they will be paid in POLY? Most of the competitors will provide KYC by themselves.
b. Polymath won’t become a broker-dealer, while some of the competitors take on this regulatory risk. And that is a solid disadvantage for them, in terms of completeness and user-friendliness. They do have strong partners in terms of security token trading platforms, though.
c. Legal delegates are questionable entity as well. If they are good, they walk toe-to-toe with technology, then why will the enter POLY ecosystem? They will be working with any other project as part of the team, demand on such lawyers is really high. And if they are not as good, as POLY plans them to be, than why let them enter ecosystem at all.
2. Weak communication with community regarding projects’ updates, no regular updates on companies internal activity and no roadmap for 2019.
Overall this project will probably be very successful, cryptospace acknowledges this project for ideas and good marketing. Despite non-existent admin activity in chat, most of the posting activity is positive. Most of the ICO’s and cryptoreviewes are positive as well.