Thoughts on Polymath ICO???

[seek4dream]

First post...

I've been following Polymath for months and I'm eagerly awaiting their launch in the next couple weeks.  The white paper is exciting and thorough. I believe in their concept and I think Polymath will be largely successful.  That being said, I'd like to be as prepared as I possibly can when the PLY enters the secondary markets.  Word from Polymath is that the free airdrop should take place between Jan 18 and Jan 31.  I imagine they'll be roughly 100K/1 Billion PLY freely distributed by the company.  Early investors and employees will aslo be vested token (mostly likely hundred of millions).  Couple questions that I'm hoping someone can answer.

Who is entitled to the rest of the tokens?  Will Polymath distribute to exchanges?

Since you can not buy PLY directly from Polymath you'll have to purchase PLY on exchanges.  Any word on which exchanges are preparing to support PLY?

Around what date can we expect to see PLY on the market?

Any information relating to Polymath would be greatly appreciated!

Been wondering the same things about Polymath. It seems like everything is pointing towards exchanges tbh and that gets me really excited. In terms of everything else, I think they're keeping under wraps. All I know is that token distribution is this month and hopefully the airdrop too. They have an announcement telelgram channel now: https://t.me/polymathnews

So there is no crowdsale for Polymath?
I have read through all information I can find about this project.
Very impressive! It would be a pity if I can't invest into this one.

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[genpro]

Just looked thru whitepapers...and haven't notice the road map
Can anyone know it?

[onyebuchi81]

just registered and waiting for distribution date.hope it is successful.

[awilliams]

First post...

I've been following Polymath for months and I'm eagerly awaiting their launch in the next couple weeks.  The white paper is exciting and thorough. I believe in their concept and I think Polymath will be largely successful.  That being said, I'd like to be as prepared as I possibly can when the PLY enters the secondary markets.  Word from Polymath is that the free airdrop should take place between Jan 18 and Jan 31.  I imagine they'll be roughly 100K/1 Billion PLY freely distributed by the company.  Early investors and employees will aslo be vested token (mostly likely hundred of millions).  Couple questions that I'm hoping someone can answer.

Who is entitled to the rest of the tokens?  Will Polymath distribute to exchanges?

Since you can not buy PLY directly from Polymath you'll have to purchase PLY on exchanges.  Any word on which exchanges are preparing to support PLY?

Around what date can we expect to see PLY on the market?

Any information relating to Polymath would be greatly appreciated!

No ICO from what I know of. They are gearing up for their airdrop this month and then hopefully they launch everything soon. Or the best circumstance would be them hitting exchanges.

Been wondering the same things about Polymath. It seems like everything is pointing towards exchanges tbh and that gets me really excited. In terms of everything else, I think they're keeping under wraps. All I know is that token distribution is this month and hopefully the airdrop too. They have an announcement telelgram channel now: https://t.me/polymathnews

So there is no crowdsale for Polymath?
I have read through all information I can find about this project.
Very impressive! It would be a pity if I can't invest into this one.

[whofeelsitknowsit]

I like free.

[yansen]

I really like Ethereum, ripple, stellar, LTC, and DGB. I think this is the best coin right now from other coins. This coin has a great future and a good project. every developer always gives the best update. and has a short update distance. so I believe this coin is good and this is my favorite.

[fearless_art]

I spent some time reading the deck and whitepaper as a potential investor.  I thought I would share this with the forum to help democratize access to sometimes difficult analysis or information.  

There are a few issues:

Two Token Types

There are two token classes, one for the platform user (called POLY tokens) and one for the issuance of securities in the underlying investment (called an ST-20 token).

• The ST-20 tokens can only be purchased by accredited investors and subject to AML/KYC.  In the US this means $1M net worth, and $200k income in the last two years as per Rule 501 Reg D of the CFR.
• The POLY tokens should be tradable by non-accredited investors, since they are used for payments made on the platform to service providers.

Token Liquidity and Value Problem

• The ST-20 market is expected to be fairly illiquid, because there are an extremely limited number of individuals that would qualify.
• Tokens issued to US holders are non-transferrable for 1 year, and thereafter can only be transferred to a US person, and all tokens must be transferred (i.e. cannot fractionize or retain partial ownership of ones tokens, it's an all or none deal)
• The POLY token market would be near worthless to anyone that is not a service provider on the platform.
• The whitepaper negates to discuss if these tokens can be converted to other currencies like ETH.  I assume they can, otherwise the devs that build the ST-20 tokens, would not be able to spend their earnings to pay for living wages, etc.

The Whitepaper attempts to address ST-20 token liquidity by saying they are based on ERC-20 tokens and the protocol is open therefore it can be listed on any exchange.
However the protocol also governs the exchange of tokens to AML/KYC and SEC (or other regulating body) verified addresses only.
This creates a problem with a traditional exchange, since many wallets and addresses are dynamically generated.  Even if they are prefixed, it would require a "KYC Provider" to verify each address for each accountholder, to provide the necessary permissions to allow the protocol to send the tokens.  So each wallet address would have to go through an outside approval process to be generated.  Further to this, the exchange would have to prevent trading of the ST-20 tokens until this is done.  So the UI would have to gray it out and a business rule built into the exchange to make sure they're not accidentally allowing trading of the regulated ST-20 token.
Every exchange would have to set this up for every ST-20 token company issuance, since the KYC/regulation parameters will vary based on the company location and local laws, plus the local laws of the investor.

Do you think an exchange that is accustomed to trading hundreds of millions per coin, will go through the trouble of all of this effort to open up a market to a very very small group of qualified investors for each ST-20 token out there?  And if you're a US investor, then you're out of luck, because you can't sell partial shares.  You have to sell the whole lot, so the exchange would be useless.

Other Flaws

The whitepaper says that the Polymath platform doesn't "see" who the investors are.  The KYC Provider is the one who will have access to this information.  However, for proper notices, like Change of Control or other information that needs to be conveyed to investors as per local regulation, the individuals themselves need to be contacted.  If the tokens are trading hands, who keeps track of who owns what and how many shares, especially if you have a free market of service providers, some that might come and go as they please.

Poor Use Case for Blockchain Technology

What is the advantage of creating an ERC-20 token and have the transactions recorded in the blockchain?  Blockchain is great for verification of transactions and the movement of assets or data.  But if the market is expected to be illiquid, and the protocol needs to know who each individual is for the above reasons, then the platform is almost utilizing none of the benefits of the blockchain.  In fact, a better way would be to centralize the issuance so that all investors are known, KYC/AML can be verified by a single body, and the capitalization table is always up-to-date.  

Also, for securities sales, the SEC limits the maximum number of investors to be 99 individuals.  In fact, organizations like AngelList have written about this issue.  They called the "99 Investor Problem"  You can't have more than 99 investors at any point of time in a private offering without structuring multiple entities.  So basically you need a very few people to own and trade very large amounts of money, to make this work.  


I Could Be Wrong

Despite my expertise in this field, I could still be wrong.  I could be incorrect in my interpretation of the whitepaper.  I could be incorrect on the possibility of a secondary market.  I could be wrong on the information I have to derive my analysis.  Polymath could still choose to illegally allow for second hand trading, allowing more than 99 individuals, etc.  Many companies already are operating outside the bounds of regulation in the token market.  Polymath could also ignore the regulated markets entirely, especially the U.S. and choose to only allow its platform to function for companies and investors in specific, whitelisted countries.

[houseo]

Hey fearless, we love the feedback and the thought process. Securities tokens are definitely a new and novel space and education is definitely needed for everyone.

I will clear a few things up:

The ST-20 tokens can only be purchased by accredited investors and subject to AML/KYC.  In the US this means $1M net worth, and $200k income in the last two years as per Rule 501 Reg D of the CFR.

This is not necessarily true. Depending on the type of offering, investors may not need to be accredited. For example, look at Reg A+ offerings in the United States. Accreditation status is not required to participate.

The ST-20 market is expected to be fairly illiquid, because there are an extremely limited number of individuals that would qualify.

This is one of the problems Polymath is trying to solve. Right now private equity and vc funds are extremely illiquid. ST-20 tokens will provide added liquidity for these otherwise dormant 'markets'.

This creates a problem with a traditional exchange

You are right. Traditional exchanges do not list securities. They are not an ATS, broker-dealer or licensed securities dealer. New exchanges and avenues are being created to tackle this. Polymath is the on-ramp for securities token issuers and these new exchanges can provide added liquidity. If old exchanges want to add securities it would be in their best interests to follow all regulations and licensing. See this article: https://www.crowdfundinsider.com/2018/01/126977-interesting-tzero-partners-polymath-initial-coin-offering/

The whitepaper says that the Polymath platform doesn't "see" who the investors are.  The KYC Provider is the one who will have access to this information.

The KYC/AML provider does not have this information. The issuing entity does. If an issuing entity uses or particular KYC provider, or does it in-house, it is the issuing entity that is able to verify who everyone is that holds their security token, based on ether address. No one else is able to see this information...the only thing that is transparent is the "whitelist" but there is no information to the public about who controls each ETH address in the whitelist.

----

In general, there are many different types of offerings and regulations. The 99 investors you mentioned is one type. Polymath is creating the protocol to allow issuers, investors, legal delegates, kyc providers and smart contract developers to interact together to create, issue and trade securities tokens. It is up to the issuers and legal delegates to determine which type of offering best suits their needs and to ensure the rules of those regulations are followed and baked in to the STO as much as possible.

[Chaka321]

"WHO IS POLYMATH?
Polymath is a decentralized network operated on the Ethereum blockchain, it is powered by individual participants such as legal delegates, KYC providers, issuers, investors, and regulators who are incentivized through POLY tokens to enforce bad actors." - faq

Got to enforce those bad actors. Is that a Freudian slip?

[jjbanks994]

Great project! Thank you Polymath team for answering those concerns. very excited for what's to come for Polymath! Keep the stampede coming. 

[analyzing]

i cant understand why every one is copying DRP idea

[Midgarosormr]

Their KYC having a passport-only requirement instead of using the scores of other legal ID available (such as driving licenses) is ludicrous.

Valid companies and entities can also check other countries' databases (such as the UK's DVLA) for ID confirmation (transnational companies for things such as driving, freight, and gambling do this regularly), so not being able to access these databases isn't a valid excuse.

This either reeks of laziness or incompetence, but I'm betting on the former since one of the messages in their Telegram involved the ease of using one company that exclusively uses passports.

They're also actively censoring their subreddit against criticism, especially regarding their botched airdrop.

They're not a scam: I genuinely believe that Polymath is legit, and they've got a lot of potential, but frankly this recent episode just poured whatever confidence I had in them being entirely competent down the drain.

[Hopewell12]

Your passport if floating around from person to person, across the internet, and you guys are actually doing this?  NEVER send your passport to anyone over the internet guys.  The people who are sending in theier personal documents to strangers over teh internet are the ones we read about in the news losing everything from identity theft or even worse if the passport gets in terrorists hands. 

Use your brains guys and do not send in your passports.

When 50-70% of the projects are scams your going toget burned after a few times of being this careless.  THINK

[noblex]

Edit: sorry wrong thread 

[jhanson]

Their KYC having a passport-only requirement instead of using the scores of other legal ID available (such as driving licenses) is ludicrous.

Valid companies and entities can also check other countries' databases (such as the UK's DVLA) for ID confirmation (transnational companies for things such as driving, freight, and gambling do this regularly), so not being able to access these databases isn't a valid excuse.

This either reeks of laziness or incompetence, but I'm betting on the former since one of the messages in their Telegram involved the ease of using one company that exclusively uses passports.

They're also actively censoring their subreddit against criticism, especially regarding their botched airdrop.

They're not a scam: I genuinely believe that Polymath is legit, and they've got a lot of potential, but frankly this recent episode just poured whatever confidence I had in them being entirely competent down the drain.

people are already receiving their Poly token. Thoughts?

[keung0109]

Looks like they were quite the buzz at the bitcoin conference in miami. Big things ahead for Polymath especially with tZERO.

[fearless_art]

Hey fearless, we love the feedback and the thought process. Securities tokens are definitely a new and novel space and education is definitely needed for everyone.

I will clear a few things up:

The ST-20 tokens can only be purchased by accredited investors and subject to AML/KYC.  In the US this means $1M net worth, and $200k income in the last two years as per Rule 501 Reg D of the CFR.

This is not necessarily true. Depending on the type of offering, investors may not need to be accredited. For example, look at Reg A+ offerings in the United States. Accreditation status is not required to participate.

The ST-20 market is expected to be fairly illiquid, because there are an extremely limited number of individuals that would qualify.

This is one of the problems Polymath is trying to solve. Right now private equity and vc funds are extremely illiquid. ST-20 tokens will provide added liquidity for these otherwise dormant 'markets'.

This creates a problem with a traditional exchange

You are right. Traditional exchanges do not list securities. They are not an ATS, broker-dealer or licensed securities dealer. New exchanges and avenues are being created to tackle this. Polymath is the on-ramp for securities token issuers and these new exchanges can provide added liquidity. If old exchanges want to add securities it would be in their best interests to follow all regulations and licensing. See this article: https://www.crowdfundinsider.com/2018/01/126977-interesting-tzero-partners-polymath-initial-coin-offering/

The whitepaper says that the Polymath platform doesn't "see" who the investors are.  The KYC Provider is the one who will have access to this information.

The KYC/AML provider does not have this information. The issuing entity does. If an issuing entity uses or particular KYC provider, or does it in-house, it is the issuing entity that is able to verify who everyone is that holds their security token, based on ether address. No one else is able to see this information...the only thing that is transparent is the "whitelist" but there is no information to the public about who controls each ETH address in the whitelist.

----

In general, there are many different types of offerings and regulations. The 99 investors you mentioned is one type. Polymath is creating the protocol to allow issuers, investors, legal delegates, kyc providers and smart contract developers to interact together to create, issue and trade securities tokens. It is up to the issuers and legal delegates to determine which type of offering best suits their needs and to ensure the rules of those regulations are followed and baked in to the STO as much as possible.

Raising in the U.S. through Reg A+ requires registration with the SEC.  Is Polymath registered with the SEC?  If not, then it falls under Rule 501 Reg D.
The ST-20 token in itself doesn't provide the additional liquidity - it is the second hand market that does that, whether it be an exchange or other medium to freely trade the tokens.  Having the token by itself with no market to trade in, is the same is having a piece of paper with shares of ownership.

I think in addition to the above, the many other things I've highlighted need to be addressed in order for Polymath to see wide-scale, meaningful adoption.  That doesn't mean the company will not have the ability to generate value in the token from hype or marketing, just look at Tron.

[gutshot5820]

Big project where I see a lot of momentum coming from them. Lots of news and partnerships forming. The shift from wall street onto the blockchain will be the easiest through them.

[Ccexicocartel]

Polymath is one of those projects that shifts the whole landscape of an industry. interested to see how they execute. other than that, I'm all in

[fearless_art]

I really wish the crypto community would spend some more time performing due diligence and analyzing ICO's and token releases more critically.

Just as you would if someone asked you for your hard earned money to invest in their business - you should have the same level of scrutiny when putting cash into a new coin.

I spent some time listening to Trevor Koverko speak.  He was an early investor in Bitcoin, Ether, and SALT - like ICO stage early.  He's very well spoken and knowledgeable about macro trends in crypto.  No doubt, he's got big capital from his early investments.  Him and his team have built solid in-roads into the crypto community, as he's known many of the well publicized  players for quite some time now (Charlie Lee, Roger Ver, Brock Pierce, etc.).  I think there's a good formula for short term success, because there's high potential for the marketing effort to drive interest, but the long term plan is where things fizzle out.

When asked about US specific regulations (SEC), he has always dodged the question.  It is clear they haven't figured this out.  I'm not surprised - it's complex.  Look at AngelList, one of the most prolific structured syndicates.  They haven't figured out the best way to address investments into companies as a result of SEC regulations, a struggle they call the 99 Investor Problem.

I prefer to index towards CEO's and founders that are highly technical, like Vitalik.  The guys that can author the protocol in low-level code, from the ground up.  In the same sense, I am more careful with CEO's that are great salesman, like Brock Pierce, Roger Ver, Justin Sun and Trevor.  These guys associate with people like the guy that shows off his garage full of books and Lambo's (you guys know who I'm talking about).  I'd rather see them have intellectual conversations on Medium with Joseph Poon or Jimmy Song. 

It is clear too, that Korea, China and possibly Japan will join the list of countries that ban ICO's.  These are some of the largest crypto markets, when added with the US, that is basically 85% of all crypto volume.  If they can figure out a way around this, this can be a successful coin.