Create Your Own Security Token Offering (STO) with Polymath

This tutorial will take you through the process of building your first Security Token Offering (STO) — if you don’t know what an STO is please read this first: https://blog.polymath.network/what-is-a-security-token-offering-sto-4e5a92bf6bca . Please note, for this tutorial you don’t need to be a blockchain expert — Understanding cryptocurrencies, securities, ICOs or Ethereum could help, but it’s certainly not a prerequisite. In this walkthrough we will be covering:

Background / Introductory Video of Polymath

https://www.youtube.com/watch?v=pOYcro53SOI

1. What You Will Need For This Tutorial

In this tutorial you will need a Metamask account (to download the chrome extension click here: https://metamask.io/ ). You will then need to fund your account. Go to this site and choose the easiest option for you: https://github.com/kovan-testnet/faucet . If you can’t decide, go ahead and choose the following method: “Gitter Channel (Manual Github Verification. If you want to request to receive Kovan Ether manually (uptime is not guaranteed, and you may have to wait for a verifier to respond), please using the Gitter channel: https://gitter.im/kovan-testnet/faucet ” You should see test Ethereum funds populate within 5 minutes, however, time may vary and could take significantly longer depending on how busy the faucet is!

Let’s get started … head on over to

https://tokenstudio.polymath.network and just like you see below, click “Issue Your Security Token”.

Note: If you do not have MetaMask yet, you will see this popup…

…which means you will not be able to move forward with the next step. So go and quickly download the chrome extension here: https://metamask.io/ and fund your account here: https://github.com/kovan-testnet/faucet by the method of posting your Kovan Ethereum address on this Gitter Channel: https://gitter.im/kovan-testnet/faucet . The Kovan faucet will then populate your wallet with the test funds in a couple minutes. After getting that set up you will now see the following page when clicking “Issue Your Security Token”:

Which brings us to the start of the Polymath decentralized application (dApp) walkthrough!

2. Creating Your Account

2.1 Let’s get started! Go ahead and set up your account with Polymath. Enter your name, preferred email and take a look at the privacy policy/terms of use page before you accept it. Now, click “Create Account”.

2.2 You will now have to click “Sign” on MetaMask to proceed with the process. This process is only to sign up your email address with your wallet address — there is no cost for this; it just allows your wallet address to be the key to access your account moving forward.

3. Registering Your Token Symbol

3.1 Let’s start with picking our Token Name and Token Symbol. As you can see I chose to call my token “Proof of Concept“ and chose the symbol to be “POC”. You can also see that the page displays the Token Issuer’s Ethereum Address (it should match your current MetaMask address). Click “RESERVE TOKEN SYMBOL” to move forward. The registration process here allows the issuer to secure their token symbol. There cannot exist two tokens created on the polymath platform that have the same ticker symbol. By reserving it, you ensure it is yours once you have created the token. Creation of the token is immutable, so you have a 15 day window between reservation and creation to make sure you can get the necessary information from your advisors/legal teams.

3.2 Before moving on you will see a “Confirmation Required” pop up to make sure you are happy with the choices you have just made.

3.3 We now confirm and submit the reservation of the token symbol…

3.4 As you progress through setting up and executing your security token offering, the Polymath platform will send you information about your token and offering via email. To receive these emails, send a confirmation email to your account via the page below.

It should appear in your mailbox right away. Click the activate link to move to the next step!

3.5 After confirming your email, you will follow the link and see this page.

Congratulations, you have successfully reserved your token name and symbol!

4.1 We now get the chance to set the details of your very own Security Token Offering! Exciting, I know.

Here you get to choose your partners to help you on the STO journey. Build your dream team by choosing the right Advisory and Legal Team, KYC/AML providers and your Marketing team. Explore those categories for yourself! Please note that the portal won’t actually send notification emails to the Service Providers you choose (advisory, legal etc..) while it is running on testnet. However, it will send you a sample copy of the email that would otherwise be sent to the service provider(s) you have selected. Once you’re done with that, go ahead and click “Create Your Token Now”! You will then see a pop up like the below before you decide to move forward…

4.2 You are one step closer to officially creating your own security token!

5. Creating Your Own Token (details)

5.1 You now have the option to add any additional information for your Token in the blank space, such as a legend or a link to a website, etc.

5.2 We now create the Issuance of your token. Click “Submit” through MetaMask and you should see the following:

Your token has now been issued Successfully. Great job! You should also have a copy of the transaction details in your inbox. Feel free to check out the Ethereum transaction you just created by following the Etherscan link.

6. Setting Up Your Offering Details

6.1 Now we move on to the final step of the remaining details of your offering. Click “SET UP OFFERING DETAILS”. You’ll see the following:

In a Capped STO, you do a raise with a hard cap, i.e. you are selling a set number of tokens at a set price per token. Once the limit is reached, no one can buy more tokens from you. Now you can finalize the details of the STO — click “SELECT AND CONFIGURE STO”.

6.2 Here you can set all the details for the offering such as: start/end date and time; if you want to raise in POLY or ETH, or both; hard cap (in tokens), and your rate. The start/end date are important because it tells your investors the time period in which they can invest in/buy your security token. Here you can also make the decision if you’d like to accept payments POLY or ETH for your tokens. In case you aren’t sure what a hard cap is, it is the maximum amount of money you want to raise during your STO (by setting it at 10 million, the sale would stop once you reach that amount of capital). Lastly, the rate is the percentage of POLY or ETH you are planning to value your token at. For example, you could have 1 POC token worth 1/10th of an ETH. Therefore, the rate you would enter would be 10. Make sure you have filled each category before proceeding!

Once you set all the details for your Security Token Offering configuration, click “Confirm & Launch STO”. You will have to “Submit” it on MetaMask in order to proceed.

6.3 Once confirmed, you will see something like this on your display:

7. Whitelisting Your Investors

We are finally on the last step! Let’s create your whitelist for your future investors so that they can purchase tokens in your STO. In case you are wondering why you need to “whitelist your investors”, securities are all about suitability, regulations, etc… and knowing who holds these securities is necessary. Whitelisting allows investors to participate in your STO, and the whitelist can be updated before/during/after the STO.

7.1 You can add investors individually by clicking “ADD NEW” and filling out the following information:

Including the dates in your STO is very important! Yes, the STO can be updated before, during and after but in order for an investor to participate in the STO, they must be whitelisted and the STO must already be in progress.

7.2 Or you can add multiple addresses to the whitelist by uploading a comma separated CSV document. Click “ IMPORT WHITELIST” and input your investors information in a CSV file containing the following 3 columns: Column 1 — Ethereum Addresses, Column 2 — Sell Restriction Date (mm/dd/yyyy),Column 3 — Buy Restriction Date (mm/dd/yyyy).

7.3 You can now submit the approved investors. You will then see the investors you’ve added to the whitelist in a table view…

7.4 There is one last step and it is for the investors on your whitelist! When the investors

send ETH/POLY tokens to your STO contract, they receive (in return) your STO issued tokens.

And that’s a wrap people! Thanks for participating in the first ever sneak peek of the Polymath dApp.

If you have any questions or feedback, please don’t hesitate to comment below, or email me at: [email protected]

Joining Polymath

Are you interested in joining the security token revolution? We are always looking for high quality talent. Check out our careers page at

https://polymath.bamboohr.com/jobs/

to apply!

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About Polymath

Polymath Network (Polymath) is a decentralized platform that makes it easy to create security tokens. The Polymath ST-20 standard embeds regulatory requirements into the tokens themselves, restricting trading to verified participants only. The platform simplifies the complex technical challenges of creating a security token and aims to bring the multi-trillion dollar financial securities market to the blockchain.