Polymath is a tokenization platform designed to solve problems related to identity, compliance, privacy, governance, and computing. It is based on the idea of giving everyone the capability to create, issue, and manage security tokens on the blockchain. The protocol was launched in 2017 by Polymath Inc headquartered in St. Thomas, Barbados.
Since Polymath’s technology focuses on bringing efficiency and transparency across all of its products, it allows issuing tradable tokens that comply with securities laws of various regions. For example, with its help, users can tokenize traditionally illiquid assets such as private placements, real estate, or fine art. In addition, companies and protocols can tokenize their assets or convert their traditional investment currencies to security tokens to make them more attractive to stakeholders. Besides, with Polymath, users can tokenize and legally register stocks and bonds to enable transactions at lower trading costs. The creation of traditional digital assets as well as stablecoins is also possible.
Polymath technology is an end-to-end solution that can be easily integrated with ecosystems of custodians, broker-dealers, law firms, token sale platforms, and KYC/AML providers. It allows issuers to reserve their tickers, customize their tokens, connect to the ecosystem of providers, and automate the application of rules and restrictions. They can also modify all configurations as needed. At the time of writing, over 200+ tokens have already been deployed on Polymath.
The security token standard
Security tokens that Polymath works with are blockchain-based digital representations of stocks, bonds, specific funds, or securities, such as debt, equity, or real estate. Just like traditional securities, they are subject to regulation and must meet strict compliance standards. What makes security tokens different from other types of digital items is that they are backed by particular assets.
Polymath spearheaded the creation of ERC-1400, a unified security token standard on Ethereum that complies with all legal regulations and obligations, and released the first version of such a token in late 2018. The ERC-1400 standard provides increased transparency for investors regarding their ownership rights to reduce the risk of fraud and improve regulatory acceptance.
Polymesh, a blockchain created by Polymath specifically to issue security tokens, went live in March 2021. It is a Proof-of-Stake chain optimized for regulated markets and assets where operators and stakeholders work together to keep it secure.
The Polymath Token Studio is a self-service application that allows users to create, issue, and manage security tokens on Ethereum and Polymesh blockchains. In particular, it lets issuers customize their offerings, and set rules around who can hold their tokens and how they can be transferred.
The Polimesh wallet is a Google Chrome extension that allows users to create signing keys, view and monitor the POLYX balance, control transfers of Polymesh-based assets, etc.
The Polymath token
The Polymath token or POLY is an ERC-20 token created to interact with the platform. The maximum total supply of POLY is limited by 1 billion coins with 75 million tokens being locked up until January 2024.
POLY is a utility token that powers the Polymath Token Studio on Ethereum. Projects use it to pay gas fees for issuing and managing security tokens. Additionally, POLY can be used to pay for the network's additional services such as legal advice, assistance in token sales, custodial solutions, and KYC integrations. Also, transaction validators help to secure the network and have an opportunity to earn passive income by staking their POLY tokens.
The POLY token can be bought and traded on leading cryptocurrency exchanges such as Binance, DigiFinex, BingX, Phemex, Upbit, Coinbase, and Hotcoin Global. Users can store POLY in any ERC-20 compatible wallet.
The Polymesh network charges three different types of fees: transaction costs, protocol costs for additional functions, and developer costs that are determined by the creators of smart contracts on the network. All fees must be paid in POLYX, an upgraded version of POLY created together with the Polymesh mainnet launch in October 2021.
POLY holders can obtain the POLYX tokens by exchanging their coins at a 1:1 ratio. After the mainnet went live, 250 million POLY tokens were swapped to POLYX and placed in the Polymesh Network Treasury. The number of POLYX will be kept at a maximum of 14% of the total POLY supply until it reaches 1 billion. After that, the number of newly issued POLYX will be set at 140 million per year as a measure against inflation.
POLYX can be used for staking and rewarding node operators and developers. In addition, holding POLYX gives users the right to vote for network improvements. Also, token holders can create and manage security tokens. Besides, all fees collected by the platform are split between the Network Treasury and node operators at a 4:1 ratio.
The Polymath platform passed a security audit by CertiK in February 2021. The code examined by the team did not have any significant or critical issues. Only two minor issues were found, and the team resolved them immediately.
Polymath team and partners
Polymath has a multinational team and a network of supportive contributors worldwide.
The development team consists of professionals deeply involved in blockchain technologies and passionate about fixed-income products and technologies in the financial sector.
Chris Housser, a former associate at Bennett Best Burn LLP, and Eric Weiss, an investor from Digital Strategies, co-founded Polymath enabling traditional securities to migrate to the blockchain. Adam Dossa is the Head of Blockchain and the Chief Technology Officer at the Polymesh Association.
Additionally, Polymath has established partnerships with a wide range of companies and 50+ global service providers to help its clients integrate the Polymath dashboard. They include advisory firms and law companies that help clients plan and execute their STOs (Security Token Offerings), KYC and AML firms, marketing, and PR agencies to promote STOs, custody and escrow services, token sale platforms, capitalization platforms, and tax services.