Polymath Decides to Lock Up $75 Million Dollars’ Worth of Tokens for the Next Five Years
Polymath is a company that is only just starting off with their security tokens, but their struggles have led them to take action to protect the company. While the market is incredibly cold right now, they have decided to preserve their treasury by locking up about $9 million worth of their tokens. This freezing of tokens will stay in effect over the next five years.
The startup is known for their work towards the advancement of security tokens, considering the new securities laws. However, even though this is a quarter of the supply that is currently in circulation, co-founder Chris Housser sees this decision as a positive one.
Speaking to CoinDesk, Housser said, “A lot of projects have shut down or done major layoffs lately due to lack of funds. What we are demonstrating is that our treasury is healthy, and we don’t have a need for these tokens at this time.”
The management of treasuries has been a major concern with the dropping asset prices. However, Housser added, “Thankfully, we decided early to diversify a lot of ETH/BTC holdings.
In the full breakdown of these locked up tokens, 74% (about 57 million) will be locked up from the allotment for the company. The rest will come from the pre-designated number of founders. The POLY smart contract indicates that, while the tokens could be used periodically through 2022, part of them will remain out of reach until January 1st, 2024.
The POLY tokens are meant for spending specifically on the Polymath platform as new security tokens are launched. There have been 75 new tokens created through this protocol so far. Housser notes that the current interest in the tokenization of assets has been real estate.
Elaborating, Housser said, “People really like the idea of fractionalized ownership and the ability to own a piece of something that would be much more difficult to do in the traditional world. With more real-estate-based financial products on the blockchain, there will be greater ability to bundle these products to go long on certain areas and short on others.”
Along with Polymath, other companies are siding with the tokenization of real estate, like RealBlocks. RealBlocks is a startup that primarily focuses on this type of tokenization, based up by Morgan Creek Digital, which is owned by Anthony Pompliano.
The industry has been positive about limited token releases or even limited treasury payouts. This is exemplified by firms like Blockstack and the Nebulas blockchain, though the latter ended up letting go about 60% of their staff in the process.
As for Polymath, Housser simply says, “We as a company and founders are committed to the project long-term.”