Polymath The Securities Token Platform Using Blockchain

What is Polymath

Polymath utilizes blockchain to assist users through complicated legal processes of trading securities, whilst providing complete transparency and increased security, as well as a more effective way that uses smart contracts to audit transactions.

The system intends to bring much needed regulation to cryptocurrency securities tokens, but in a completely revolutionized manner designed to take advantage of the blockchain technology.

The unregulated world of cryptocurrencies is undergoing yet another onslaught of attacks from government and world banking institutions, Polymath however, is a platform that has the potential change all of that.

What problems does Polymath solve?

In the early 1700’s the world experienced what is often referred to as the first global stock market crash when the South Sea Company’s shares were incorrectly speculated to be worth much more than their fundamental value, and thus were sold off rapidly by investors trying to cash in. With no regulations in place to correctly manage the sales the share plunged 83%. In an effort to prevent the crash an English statute, known as the Bubble Act, was devised.

The Bubble Act intended to provide better regulation in the buying and selling of securities, and required companies to acquire a royal charter before selling shares. The statute was repealed in 1825, and during the early 1900’s, with still little in the way of regulations, companies began selling of securities based on weak, and often fraudulent information. Subsequently the stock market crash of 1929 lead to the Great Depression and prompted a new set of rules, rules that now form the basis of the U.S. The Securities Act of 1933.

The new securities act called for two main objectives:

Require investors to receive financial and other material information concerning securities being offered for public sale.
Prohibit deceit, misrepresentations, and other fraud in the sale of securities.

The just one year later, The Securities Exchange Act of 1934 was introduced to better regulate the secondary market — sales of securities between investors after the initial offering by a company. And The United States Securities and Exchange Commission (SEC) was also established to assist in matters of trading securities to protect investors.

As the industry continues to grow each year, so too do the attempts to uncover loop holes and leverage vulnerabilities for fraudulent purposes, and as a result the system must constantly be reformed to keep up-to-date with the latest exploits.

In 2010 the Dodd-Frank Wall Street Reform and Consumer Protection Act was put into power. The new regulations saw a huge transformation to improve the financial regulatory system, and although these changes are certainly for the better, it all comes at a price, a price so high that has kept even larger tech firms out of the public market the past few years.

With regulations set forth by the SEC, transactions in both primary and secondary markets are protected. But when it comes to digital currencies, a factor that worries many is that that whole system is unregulated.

Polymath, can solve that problem by embedding SEC regulations as requirements on the blockchain and utilizing smart contracts to execute transactions only once approved and if both parties have sufficient resources to fulfill the trade.

How Does Polymath work?

Polymath utilizes the Blockchain for its worldwide-decentralized ledger in which all the necessary data and tools can be stored to organize participants to enable legally compliant securities offerings and reduced transaction costs over time.

The system consists of 5 main participants, each of which provides a vital piece of the process, and is incentivized to do so along the way.

· Investors — Individual consumers or organizations wanting to trade or purchase security tokens.

· Issuers — Those who wish to sell security tokens.

· Legal Delegates — Delegates place bids, with on-chain restrictions put forward in proposals. They can also act as representatives’ off-chain to assist issuers through meeting the compliance requirements.

· KYC (Know Your Customer) Providers — KYC providers validate the real identities of the participants and carryout the due diligence required to accredit investors. By receiving accreditations in their relevant jurisdictions investors can improve their standing and have some restrictions removed.

· Developers — These software engineers create and review initial offering contracts in return for security tokens.

Participants can operate in three markets places in the Polymath system. These include:

· KYC Provider Marketplace — KYCs offer validation and accreditation services to investors in their jurisdiction. They post the cost to use their service (no bids).

· Legal Delegate Marketplace — Delegates assist with completing the legal delegate process. They must bid on the cost of representing an issuer during the process. The transparent nature of blockchain allows third-parties to track the number of issuances completed by a delegate, which should help issuers decide which KYC to use.

· Developer Market — Issuers may wish to have their Security Token (STO) contracts made or reviewed by a smart contract developer. Developers are able to bid on these jobs.

Polymath provides a framework for investors to find and autonomously assist with issuers to perform legally compliant securities trades that meet regulatory standards in jurisdictions worldwide. It allows for legal delegates to bid in order to assist with the legal process, developers to bid in order to create or analyze smart contracts, and KVCs to offer validation and accreditation services to back to investors.

In order to use the platform a user must register with their true identity and gain an accreditation status validated by a KYC provider. As well as confirming a users identity, jurisdiction, this also validates their eligibility to trade in the secondary market with other investors also with valid identities.

All transactions are funded by the POLY Tokens, a standard ERC20 token which are embedded with defined requirements specifying use only amongst verified users.

Such a system effectively eliminates the need for middleman and agencies that employ expensive and complex auditing systems that take long periods of time to produce results.

Polymath assists through the whole complex legal process while also improving security, auditability, and accountability of the securities market. And because all transactions happen out in the open on the transparent blockchain, all the public may bear witness to any and all transactions that take place.

Valuable Information Coin Name : Polymath (POLY)

Total Supply : — Launching the Securities Token revolution ($1 trillion)

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