With the launch of the Polymesh blockchain in Q4 2020, this is the most important year since Polymath’s inception. Our focus on creating a blockchain has encouraged us to continue to dig deep and understand the market and needs of some of its biggest players. That’s why our team has been spending time across the pond speaking with some of Europe’s largest financial institutions about our progress on the Polymesh blockchain and how to work together. These conversations have helped us reframe some assumptions, but more importantly, showed us that we are moving in the right direction with Polymesh.

Here are a few key takeaways:

There’s been a stark change in the conversation — We’ve talked to thousands of market participants about the incoming security token revolution. Like most new technology, many key players have taken a wait-and-see approach. But, on our latest trip, the conversations have changed to institutions now wanting to be first and not wanting to be left behind. We know the groundswell of news surrounding security tokens is resonating with institutional clients who are driving this change as the clamour gets louder and louder (look no further than RedSwan’s $2.2b in real estate security tokens using Polymath technology). This is a key tipping point for the industry and one we’ve been waiting to see.

It’s not only about equity — using blockchain technology to raise equity was originally considered its most high-profile use case. But, a hypothesis we’ve had, and something we’re starting to hear more and more from institutions, is the use of blockchain technology for other financial instruments. Fixed income, funds, and structured products on the blockchain benefit institutions by automating back office tasks and other redundancies that can drive more effective administration.

ERC1400 is being embraced as the standard — when we led the creation of The Security Token Standard (ERC1400), we did it because the security token space desperately needed a scalable and reliable standard for security token smart contracts. Not only were we excited to hear that its worldwide use is more widespread than we thought (Upvest, Consensys, Diginex), it was a nice touch to hear it was our “claim to fame”. We’ll be taking the concepts established with ERC1400 and applying them to the Polymesh blockchain.

The challenges with public, permissionless blockchains are real and recognized — Unverified identities. Pseudonymity. Contentious forks. Inefficient processing power. Time and time again we heard that the challenges we’ve flagged with public, permissionless blockchains are felt by institutions, and they are excited to see us develop Polymesh–a permissioned blockchain solution optimized for security tokens.

We’re designing our blockchain right — Because of the challenges that face the industry and open, public blockchains, we know that we’re designing Polymesh for security tokens and institutions. We’re prioritizing governance, identity, confidentiality, and compliance as principles core to the design so they are inherent in our architecture from the ground up.

Polymesh will be the first blockchain built for security tokens. As we continue to forge a path forward, it will be of the utmost importance for our team to continue understanding our audience and market circumstances we face.

If you’re interested in being a part of Polymesh, explore what it means to become a validator.

Learn more about Polymesh and read the Polymesh Whitepaper.