Polymath

Polymath is creating a platform that aims to provide a marketplace for the creation of blockchain-based financial products. Compared to the traditional initial public offering (IPO) process used in equity markets the team hopes to use tokens to decrease the costs for organizations to issue securities while allowing more investors to participate in offerings.

While recent token sales, or initial coin offerings (ICOs), have focused on payment tokens used to transfer value or utility tokens used to access goods or services on a platform, all tokens issued through Polymath will be securities (security tokens). Security tokens are specifically intended to represent a stake in an organization or a claim to the wealth generated by its activities. They are therefore subject to security regulations in the case of both issuers and investors.

Polymath plans to offer a blockchain-based issuance system that allows organizations to create tokens and engage service providers, like law firms and developers, to complete a token sale. Investors will be able to participate in securities token offerings (STOs) and trade their tokens on a secondary market. Polymath plans to integrate third-party know your customer (KYC) providers to verify details about issuers, investors, and service providers, including location and accredited investor status. The integration of KYC and legal service providers aims to allow issuers and investors to comply with various regulations across jurisdictions.

Tokens created on the network will be based on Polymath’s ST20 standard which incorporates KYC compliance into the token. This should create a system where only investors, as identified by Ethereum addresses, that match the regulatory profile (location, accredited investor status, etc.) outlined by the organization are able to purchase tokens. ST20 tokens will be modular and can be changed over time to reflect new governance or change features such as dividend payments.