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- 1 POLY is a classic utility token that is primarily utilized to facilitate on-platform transactions.
- 2 Polymath was created in 2018 and registered with the SEC to address some specific issues.
Capital markets have strict regulations and high responsibilities for businesses seeking to raise funds from investors, but standard blockchain technology is not equipped to handle this.
A Beginner Guide to Polymath
Polymath is a leading project that addresses these limitations and allows the benefits of raising capital to be brought to the blockchain world.
Regulated security tokens are necessary for capital markets, which have been historically limited by blockchain technology’s open access and lack of regulatory framework.
In 2017, some crypto projects attempted to use security tokens to attract investors, but many of these tokens lacked proper standards or regulations. The SEC did not recognize these as proper securities.
Polymath was created in 2018 and registered with the SEC to address these issues, bringing standardization and regulatory compliance to tokenized capital raising.
It is an Ethereum-based security token issuance platform that enables entities to issue standardized, SEC-compliant security tokens.
Polymath helped develop Ethereum’s standard for security tokens, ERC-1400, and uses the related ST-20 security standard to issue its own tokens. These tokens have specific rules and requirements that issuers and investors must follow for a capital-raising transaction to occur.
What is Polymesh and Why it will Replace Polymath
While Ethereum was not designed for capital markets, Polymesh was created with this in mind and will eventually replace Polymath. Polymath Capital Platform is a comprehensive solution for end-to-end tokenized capital raising, managing the life cycle of capital-raising activities and enabling companies to create offers, tokenize them, attract investors, and more.
Investors can use Polymath’s white label platform to browse through offers and apply filters such as country, capital requirements, and identification requirements. Polymath Token Studio is a utility for managing security tokens, where users can handle all token operations such as reserving ticker symbols, configuring token rules, and distributing tokens.
Polymath requires issuers to specify all parties involved in their projects, including brokers, legal representatives, and custody agents. After meeting these requirements, a company can mint and promote its security token using the ST-20 standard.
POLY Token
The cryptocurrency called POLY is utilized by Polymath as a utility. It is an ERC-20 token on the Ethereum blockchain and is responsible for powering the operations of the platform. POLYX is the native cryptocurrency of the new Polymesh blockchain.
To pay fees for all on-platform transactions such as minting of security tokens or identity verification services, POLY is utilized on Polymath. The token plays a significant role in transaction payments on Polymath in the same manner as Ether on the Ethereum blockchain.
POLY is a classic utility token that is primarily utilized to facilitate on-platform transactions. Whereas, the new POLYX coin on Polymesh blockchain has governance and staking functionalities, which the POLY token lacks.
Summary
Polymath is a project to bring venture capital to blockchains. It may help in legitimizing security tokens as securities. It can serve as a complementary capital market platform to traditional financial market platforms. In the future, companies and investors may prefer blockchain and security tokens for capital raising and investment.
Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.
