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Knowledge hub

Knowledge Hub

Polimec’s Knowledge Hub serves as a repository of modular information for all stakeholders who interact with the network and seek a deeper understanding of its functioning. This community-oriented initiative is spearheaded by the Polimec Foundation and constitutes a reliable source of truth, providing information on all matters pertaining to Polimec.

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General Information

Polimec Basics

Vision and Mission of Polimec

Polimec’s vision is to transform finance for a fair and decentralized future.

Polimec’s mission is to shape the future of finance by democratizing access to capital and transforming the landscape of direct ownership. By leveraging decentralized technologies, Polimec delivers products and solutions for a more inclusive world, where everyone has the power to participate and own.

Purpose of Polimec

Polimec provides an automated framework for projects to raise funds within a broad and diverse community with transparent and fair access for all. The protocol provides access to fundraising and manages the issuance, distribution, and conversion of tokens to mainnet.

Polimec allows different stakeholders to participate in funding rounds, and minimizes information asymmetry between participants and issuers to grow their community. The underlying reward mechanism ensures that the interests of the various participants and projects are aligned for sustainable fundraising.

Furthermore, the native enables access to fundraises and a variety of additional functionalities such as evaluations, , liquidity provisioning, governance, and more.

Roles on Polimec

are projects raising funds on Polimec. After providing the necessary documentation and structuring their funding process, issuers are subject to approval from evaluators to enter the funding round and depend on participants to achieve a successful fundraise.

are incentivized to assess projects accurately, as they earn rewards for successful evaluations or get for unsuccessful ones. The evaluation process is intended to be transparent, with evaluations recorded on the blockchain and evaluator linkable to social media profiles.

are actors categorized as , , or . They can browse projects and participate in those for which they are eligible. Unsuccessful funding rounds will result in an automatic refund of the participants’ contributions. are automatically converted to once a project’s goes live.

earn staking rewards by delegating to who help stabilize the network. Staking rewards for collators and their delegators are paid out in PLMC on a round-by-round basis. The effective staking rewards rate is determined by the amount of PLMC staked in relation to the total supply.

Technical Infrastructure

The Reasons for Polkadot

Polimec builds on the ecosystem infrastructure due to its crucial differentiation from other decentralized protocols. A key pillar is that Polkadot enables true and of any type of data or asset. The ability to interoperate with various blockchains is critical for a thriving fundraising ecosystem and leveraging network effects. Furthermore, on Polkadot every derives its security from the Polkadot and its . This ensures that each transaction on Polimec is secure and . Low transaction fees allow the protocol to scale and enable Polimec to improve consistently and swiftly without requiring time-consuming .

Polimec executes token transfers between the and the on-chain treasury in an automated manner. This includes mechanisms for the issuance and distribution of contribution tokens and their conversion to the project’s mainnet token at launch. Polimec works with trusted third-party providers to verify network participants and support them in complying with relevant regulations.

Polimec integrates with other parachains and built on Polkadot’s technology and any or 2 blockchains built on top of the existing of Polkadot. Also, Polimec is accessible to other ecosystems, including -based networks.

Polkadot’s Parachains

Polkadot is an advanced blockchain that utilizes a heterogeneous architecture, which enables a network of specialized, independent blockchains, known as parachains, to operate in concert under a unified security umbrella. This multichain model allows for diverse, independent blockchains specialized for various purposes to work together, creating a free alliance of sovereign chains. Polkadot, as the layer 0 protocol, underpins and supports this network of layer 1 parachains, enabling cross-chain interoperability and facilitating the transmission of any type of data or asset between parachains, thereby creating a new paradigm of interchain services, communities, and economies. This multichain architecture serves as the foundation for a new, decentralized internet, commonly referred to as Web3, a term coined by Polkadot’s founder .

The parachain model brings scalability to blockchain technology in a more decentralized and trustless manner. Transactions are distributed across the network, taking place in-parallel or simultaneously on several blockchains, all of which are secured by decentralized validators.

The parachain model unlocks a multitude of possibilities for blockchain technology and the future of Web3. Parachains bring a plethora of benefits, a few of which include specialization, flexibility, and interoperability.

Polkadot’s Consensus Mechanism

The Polkadot blockchain has implemented a consensus mechanism known as to facilitate the selection of validators who are granted the privilege of participating in the network’s governance protocol. A cohort of individuals referred to as validators are elected to perform vital functions such as block production and the validation of transactions. These individuals are held to a high standard of reliability, and are required to demonstrate their commitment through the act of staking their , the blockchain’s native token, which serves as a collateral for their adherence to protocol.

While any node may publicly offer itself as a candidate for the role of validator, only a limited number are ultimately elected, due to operational constraints. Additionally, the ecosystem encourages the participation of DOT holders as nominators, who publicly endorse a list of validator candidates they trust and place a corresponding stake of DOT to support their endorsement. This arrangement provides robust security guarantees by enabling the selection of validators with substantial aggregate stake, while simultaneously eliminating candidates with low stake. Furthermore, the election process is informed by a blend of election theory, game theory and mathematical optimization to ensure fairness and security in the selection of validators.

Collators’ Role

In parachain networks, collators play a critical role in maintaining the parachain’s functionality by aggregating transactions from users on the parachain and generating state transition proofs for Relay Chain validators. To accomplish this, they maintain a complete for the Relay Chain and another for their corresponding parachain, enabling them to retain all necessary information to author new blocks and execute transactions, akin to the role of miners on blockchains. In the normal course of operations, they collate and execute transactions to produce an unsealed block, which they then furnish, along with a , to one or multiple validators responsible for proposing a parachain block.

It is worth noting that collators are not required to provide security guarantees, as Polkadot’s protocol provides them. The validators are responsible for assessing the validity of submitted candidates and issuing statements about their validity to other validators. Once a candidate meets the criteria for inclusion, it is included in the Relay Chain block. Furthermore, collators are a vital component of the by facilitating message passing between different parachains.

Challenges in Fundraising

One of the main unresolved obstacles to innovation and growth in fundraising is the efficient allocation of capital. To achieve capital efficiency during fundraising, all stakeholders’ incentives must be aligned. Fundraising possibilities as of today are still highly trust-based, centralized, dominated by opaque and inefficient procedures, and limited to the network of projects and/or intermediaries.

Centralized processes with inherent counterparty risk: Given the decisive role centralized funding platforms and other intermediaries currently play in project funding, they effectively act as gatekeepers by imposing non-transparent terms and processes on issuers and participants in their self-interest. Relying on intermediaries in the funding process leads to counterparty risks and exposes issuers and participants to the intermediaries’ inefficient, error-prone, and arbitrary practices.
Misalignment of stakeholder interests and information asymmetries: Centralized funding providers leave participation opportunities up to an individual’s arbitrary judgment and preferences. Intransparency in token allocations, prices, and vesting periods for different types of participants only adds to the information asymmetry between the various stakeholders. This can lead to dire consequences for disadvantaged participant categories, the community, and issuers, and carries a significant reputational damage risk.
Limited accessibility: Early-stage funding opportunities today are only accessible to corporations and individuals rooted in narrow and, in most cases, exclusive circles. Similarly, centralized funding platforms limit the optimal allocation of capital and access to funding rounds to their client base - which usually is limited to a specific target group. The exclusion of certain participant categories, jurisdictions, and high entry barriers restrict the establishment of a diversified participant/future token holder base.
High costs and lengthy lead times: Today, projects allocate substantial time and effort to fundraising. Performing funding rounds is time-consuming, stressful, and can negatively impact the project’s development plans. Turning to intermediaries or centralized funding platforms, on the other hand, almost always involves upfront payments and high fees. Instead, projects should be able to focus on creating valuable business models.

Network Participants

Overview

Polimec brings together all stakeholders required for sustainable project funding and aligns their multifaceted interests. The following section provides a detailed overview of the different network participants, their roles, and how they benefit from functionalities on Polimec.

The following network participants are involved in funding rounds on Polimec:

Issuers who raise funds
Evaluators who evaluate projects
Participants who participate in funding rounds

All the network participants contributing to the funding round process require verification to interact with the network. The verification is conducted by trusted third parties that provide the required services.

Issuers

Issuers are projects raising funds on Polimec. The issuers can submit a project on Polimec by providing all required information as described in the .

After providing all required information, the project goes through the evaluation process, where evaluators signal that they expect a specific project to complete the funding round.

Once the issuer has secured the required backing from evaluators, the funding round begins in which retail, professional, and institutional participants can participate.

The following threshold applies to the total amount raised relative to the target funding amount, which determines the project’s potential outcome.

Possible outcomes:

Thresholds

Outcome Project

Outcome Evaluators

Outcome Participants

Should the total amount raised fall below 33% of the target funding amount, the protocol automatically declines the project, slashes 20% of the evaluators’ PLMC, and refunds the participants. The slashed PLMC are allocated to the on-chain treasury. The 33%-threshold incentivizes projects to raise funds in line with their expectations. It prevents unrealistic or excessively high valuations as well as participants getting stuck in an unsuccessful funding round.

Should the total amount raised fall at a level of 33% or above of the target funding amount, the protocol automatically accepts the funding, evaluators are rewarded in the respective contribution tokens based on the amount raised for the project, and participants receive the respective contribution tokens based on their participation.

Based on the total amount raised compared to the target funding amount, the funding is automatically accepted or declined. The applicable settlement will occur 1 hour after the automatic outcome.

Evaluators

Evaluators play a key role in assessing projects that apply for funding on Polimec. They are rewarded for accurate evaluations and penalized (slashed) for incorrect ones, encouraging them to back only high-potential projects. This ensures that only promising projects move forward for funding.

The following process ensures credible evaluations, transparent decision-making, and informed participation in the funding round:

Due Diligence (7 Days)

Evaluators review a project’s whitepaper, team, tokenomics, roadmap, and funding allocation before giving their assessment. The data room allows other participants to analyze evaluation results and make informed decisions.

Bonding PLMC as Signal

Evaluators bond PLMC to show confidence in a project’s success. Once bonded, the evaluation lock restricts the PLMC for use in funding rounds and voting only for that project. The lock remains until the funding round is completed or canceled.

Enhancing Transparency and Visibility

Evaluators can link their DID (Decentralized Identity) to social media profiles (Twitter, Telegram, Discord, GitHub, etc.) to increase credibility and reach. This allows their assessments to be easily shared, helping spread awareness about projects.

Key Requirement: 10% Bonding Threshold

A project only moves to the funding round if evaluators bond at least 10% of the target funding amount in PLMC (USD equivalent).

If the 10% threshold is not met, the project does not proceed, and evaluators face no penalties.
If the 10% threshold is met, the project enters the funding round, and evaluator rewards depend on the final amount raised compared to the target funding goal.

Possible outcomes:

Thresholds

Outcome Project

Outcome Evaluators

Outcome Participants

<33%

Rejected (autom.)

Slashed

Refunded

≥33%

Accepted (autom.)

Rewarded

Receive Contribution Tokens

Should the total amount raised fall below 33% of the target funding amount, the protocol automatically declines the project, slashes 20% of the evaluators’ bonded PLMC, and refunds the participants. The slashed PLMC are allocated to the on-chain treasury. The 33%-threshold incentivizes projects to raise funds in line with their expectations. It prevents unrealistic or excessively high valuations as well as participants getting stuck in an unsuccessful funding round.

Based on the total amount raised compared to the target funding amount, the funding is automatically accepted or declined. The applicable settlement will occur 1 hour after the automatic outcome.

Participants

Participants contribute to funding rounds of projects on Polimec. A trusted third party classifies them into the following categories based on their financial circumstances, governance status, or professional experience:

Retail

The category retail is assigned to individuals who do not qualify as professionals.

Professional

The category professional is assigned to individuals who:

are considered , or
possess the necessary knowledge based on education, professional experience, or comparable experience in the financial sector to understand the risks of financial decisions and have at their disposal assets of a certain amount

Institutional

The category institutional is assigned to legal entities (non-natural persons) that qualify as professionals, such as:

Regulated financial intermediaries (e.g. banks, fund management companies, securities dealers, asset managers, regulated insurance companies, etc.)
Companies with dedicated professional treasury departments

While professional and institutional participants are needed to a project economically, retail participants fulfill further funding needs and form an essential part of community building and a distributed token holder base. The three categories are based on terminologies that are commonly used in traditional financial markets.

Funding rounds on Polimec are structured to ensure the participation of all three participant types at a similar price, with transparency in token allocations, multipliers, and vesting schedules. The participant categories impact the multipliers and corresponding vesting periods.

Stakers

Begin your staking journey with Polimec by delegating your PLMC to the collator(s) of your choice. To delegate your PLMC, visit Polimec's staking dashboard.

Similar to NPoS, where DOT holders can participate as nominators, in Polimec’s delegated proof-of-stake mechanism (DPoS), PLMC holders can engage as delegators. By delegating to collators, they are eligible to receive rewards in PLMC in return. This process, referred to as staking, closely mirrors the procedure for DOT holders on the Relay Chain. During staking PLMC, a staking lock is activated, restricting transfers, evaluations, and participation in projects using the staked PLMC.

Staking rewards for collators and their delegators are paid out in PLMC on a round-by-round basis. The effective staking rewards rate is determined by the amount of PLMC staked in relation to the total supply. The more PLMC staked, the less staking rewards per staked PLMC.

For further information on this topic, visit the staking page.

Funding Process

Overview

Polimec deploys a rule- and blockchain-based framework for raising funds in an automated, trustless, and disintermediated manner. The following section provides a detailed overview of the entire funding process on Polimec in chronological order.

Polimec’s funding process:

Tokens on Polimec

Participation Currencies

Participation currencies are any currencies the issuer accepts for contributing to the funding round and are specified by the issuer in the funding application (e.g. USDT, USDC, DOT, ETH).

Contribution Tokens

Contribution tokens are tokens issued by projects which successfully raised funds on Polimec. They are distributed to evaluators and participants who contributed to the project’s successful funding round. Contribution tokens are transferability-locked in the wallet of participants or evaluators after distribution and are automatically converted to the project’s transferable mainnet token at launch.

The purpose of the contribution token is to provide trust and transparency by serving as proof of participation and is used to incentivize network participants and the community. In addition, it facilitates the efficient distribution of the project’s mainnet token at launch by allowing the migration of balances to the mainnet and conversion of the corresponding contribution tokens in a fully automated process.

Mainnet Tokens

Mainnet tokens are tokens issued by projects on their fully developed and deployed mainnet or blockchain protocol.

Polimec facilitates the migration of contribution token balances to the project’s mainnet in an automated and trustless way. This is achieved by a simple token conversion between the project’s contribution tokens and the project’s mainnet tokens.

Polimec’s balance migration process introduces transparency by maintaining a complete track record of contribution token balances and ensures a secure and efficient token distribution process for issuers and participants.

Onboarding

Polimec enables regulatory compliant DeFi by incorporating a comprehensive framework with regards to KYC/AML and other checks performed by specialized, trusted third parties to ensure adequate verification of all network participants involved in a fundraise.

Particularly for issuers, it is essential to offer and distribute their contribution token only to individuals or entities that are properly verified and have met the KYC/AML standards per jurisdictional and funding round specific criteria. The performed checks ensure that a user always meets these requirements according to the issuers’ criteria.

Polimec has partnered with global leading provider to integrate its advanced KYC/AML verification solutions. This integration signifies a substantial advancement in Polimec’s commitment to seamless user experience, while not making any concessions with regards to security and regulatory compliance on a product level.

In-App user verification allows users to complete a streamlined verification process powered by Sumsub's cutting-edge technology during the participation process, without leaving the Polimec application. The solution offers a high degree of customization, allowing issuers to implement additional or specific checks relevant for their fundraise on Polimec. The process begins with user registration, where individuals create an account on Polimec and initiate the verification procedure. The system then prompts users to upload government-issued identification documents, such as passports or driver's licenses. Additionally, users may be required to perform biometric verification, like a liveness check or submitting a selfie, to confirm their identity against the provided documents. Sumsub conducts real-time compliance screening by checking against international sanctions lists, politically exposed persons (PEP) databases, and other watchlists to ensure compliance with AML regulations.

The In-App user verification excels through its industry-leading user experience and processing time, resulting in an average verification time of around one minute. This verification option ensures that the KYC/AML process is both user-friendly and robust, minimizing friction while maintaining high security standards.

The improved user experience enabled by the efficient verification process accelerates onboarding and allows users to participate in fundraising campaigns promptly. Furthermore, scalability is achieved since Sumsub's infrastructure is designed to handle large volumes of verifications, ensuring consistent performance as Polimec grows.

The integration of Sumsub's KYC/AML solutions represents a significant enhancement in Polimec's commitment to providing a secure, scalable and seamless platform for decentralized and compliant fundraising. By ensuring that all participants are thoroughly verified, Polimec creates a safer environment for fundraising and builds trust within the community.

Funding Application

Contribution Token Registration

Once an issuer is verified, the issuer applies for the registration of a new contribution token by specifying the following parameters:

Token information:
- Name
- Ticker
- Smallest denomination
Total allocation of contribution tokens available for the funding round
Minimum price per contribution token
Maximum and/or minimum ticket size
Participation currencies (e.g. USDT, USDC, DOT, ETH)
Issuer destination accounts for accepted participation currencies (for receiving participation currencies)

Project Information

The issuer provides project-specific information to the community, encouraging evaluators and participants to contribute. To give a comparable information basis for all stakeholders to perform due diligence, submitting the following minimum information is mandatory:

Whitepaper
Team description
Tokenomics
Total supply of mainnet tokens
Roadmap (next 12-36 months)
Usage of funds

Evaluation

Evaluation Process

The following process ensures credible evaluations, transparent decision-making, and informed participation in the funding round:

Due Diligence (7 Days)

Bonding PLMC as Signal

Enhancing Transparency and Visibility

Key Requirement: 10% Bonding Threshold

A project only moves to the funding round if evaluators bond at least 10% of the target funding amount in PLMC (USD equivalent):

If the 10% threshold is not met, the project does not proceed, and evaluators face no penalties.
If the 10% threshold is met, the project enters the funding round, and evaluator rewards depend on the final amount raised compared to the target funding goal.

Possible outcomes:

Thresholds

Outcome Project

Outcome Evaluators

Outcome Participants

≤33%

Rejected (autom.)

Slashed

Refunded

>33%

Accepted (autom.)

Rewarded

Receive Contribution Tokens

Should the total amount raised fall at a level of 33% or below of the target funding amount, the protocol automatically declines the project, slashes 20% of the evaluators’ bonded PLMC, and refunds the participants. The slashed PLMC are allocated to the on-chain treasury. The 33%-threshold incentivizes projects to raise funds in line with their expectations. It prevents unrealistic or excessively high valuations as well as participants getting stuck in an unsuccessful funding round.

Should the total amount raised fall above 33% of the target funding amount, the protocol automatically accepts the funding, evaluators are rewarded in the respective contribution tokens based on the amount raised for the project, and participants receive the respective contribution tokens based on their participation.

Based on the total amount raised compared to the target funding amount, the funding is automatically accepted or declined. The applicable settlement will occur 1 hour after the automatic outcome.

For detailed calculations, visit Polimec’s evaluator rewards allocation section.

PLMC bonded for evaluations can still be used to participate in the funding round of the evaluated project as well as for voting, and are released at the end of the funding round.

The evaluation process includes gamification features, such as social credit building. Evaluators are scored based on past evaluations and can increase/decrease their scores to move up or down in the evaluator ranking.

Social credit building allows participants to follow evaluators they trust based on publicly available data. Social credit building generally narrows knowledge gaps, as one evaluator may emphasize technical aspects while another may focus more on the potential business case.

A visible track record of evaluators’ assessments further enhances accountability on the network. Furthermore, evaluators can link their identity with social media accounts (e.g. Twitter, Telegram, Discord, Youtube, Github) to increase, and benefit from, their community engagement.

Funding Round

TL;DR

Fixed price mechanism until the total allocation is sold out
Highest bids take priority, while lower bids are excluded if demand exceeds supply
Each tranche increases in price by 10%, ensuring fair price discovery

Once the evaluation period has concluded with the required minimum evaluator backing, the funding round starts. Everyone can participate in the funding round with the predefined participation currencies (e.g. USDT, USDC, DOT, ETH) and within the range of the eligible amounts. While the project defines the maximum ticket size, the protocol specifies a minimum ticket size of USD 10 per bid. The round concludes after 14 days. Settlement of the participation amounts to the issuer account takes place 7 days after the end of the funding round.

The issuer sets a minimum price per contribution tokens as the .

If demand is within the funding target (≤Q₀), all bids are accepted at the minimum price per contribution token (P₀).
If demand exceeds the funding target (>Q₀), oversubscription occurs. In this case, the protocol prioritizes higher bids first, replacing lower bids. An oversubscribed round involves continuously reallocating a fixed amount, specifically 10% of the amount of contribution tokens allocated to the funding round (Q₀), to higher bidding prices. This increase in the bidding price is also fixed at 10% of the minimum price per contribution token (P₀). If participants submit bids at the same price, they are prioritized according to the time they were submitted. Consequently, the most recent bids with the lowest price are replaced first.

Polimec’s high-level oversubscription mechanism:

Polimec’s oversubscription structure:

Tranche

Amount of Contribution Tokens (Q)

Price per Contribution Token (P)

T₀=Q₀xP₀ (genesis tranche)

Q₀=fixed in funding application

P₀=fixed in funding application

T₁=Q₁xP₁

Q₁=Q₀x0.1

P₁=P₀x0.1

T₂=Q₂xP₂

Q₂=Q₀x0.1

P₂=P₁+(P₀x0.1)

Tₙ=QₙxPₙ

Qₙ=Q₀x0.1

Pₙ=Pₙ₋₁+(P₀x0.1)

Polimec’s oversubscription structure (with random numbers):

Tranche

Amount of Contribution Tokens (Q)

Price per Contribution Token (P)

T₀=USDT 1,000,000

Q₀=100,000

P₀=USDT 10

T₁=USDT 110,000

Q₁=10,000

P₁=USDT 11

T₂=USDT 120,000

Q₂=10,000

P₂=USDT 12

T₃=USDT 130,000

Q₃=10,000

P₃=USDT 13

Winning bids are those submitted by participants on time and at the minimum price per contribution token (genesis tranche) or at a higher price when the genesis tranche is full. Thus, it might also be that, especially if demand is high, all winning bids fall at higher prices than the minimum price per contribution token.

The funds are transferability-locked until the funding round ends and released to the issuer at the end of a successful funding round. The protocol automatically issues, distributes and converts the contribution tokens to the participants. If the funding round is unsuccessful because the minimum threshold in relation to the target funding amount is not reached, the funds are returned to the participants, and the contribution tokens are not issued.

The protocol facilitates trustless, direct token transfers, ensuring seamless settlement between network participants in a fully permissionless manner.

Participation Options

There are two ways to participate on Polimec: The One Token Model (OTM), which allows participants to borrow PLMC from Polimec’s on-chain treasury, eliminating the need to hold PLMC, or bonding PLMC, where users use their own PLMC tokens.

One Token Model

The One Token Model, or short OTM, simplifies the investment process on Polimec. It enables full functionality for users holding USDT, USDC, DOT or ETH to invest directly in projects on Polimec. Investors only need a single token (USDT, USDC, DOT, or ETH) to participate. This participation option enables broader market actors access to Polimec deals and streamlines the participation process in return for charging a participation fee, which flows back to the protocol benefitting the PLMC holders.

The main goal is to broaden investor access and enhance the user experience by making the investment process intuitive. Additionally, this is a milestone in Polimec’s advancements towards the launch of the white-label solution. By enabling financial intermediaries like exchanges, banks, and brokers to participate via underwriting, Polimec broadens accessibility and facilitates easier onboarding of institutional players.

Through the OTM, Polimec enables a significantly improved user experience, which leads to higher conversion rates among potential investors. Additionally, the ecosystem will benefit as PLMC holders gain from the small participation fees, introducing an additional advantage for token holders.

The OTM is as straightforward as:

Connect your wallet
Choose the amount to want to invest
Participate

In the background, the PLMC from Polimec's protocol growth on-chain treasury are bonded on the user’s behalf, and seamlessly returned to the protocol growth on-chain treasury thereafter. The multiplier is set to 5, resulting in a vesting period of 8.67 weeks following a successful funding round.

Polimec’s OTM flow:

As Polimec scales, the OTM becomes a cornerstone for institutional adoption, particularly among exchanges, brokers, and banks. The model will support more assets beyond USDT, USDC, DOT and ETH. With the rollout of its multi-chain approach, Polimec enables financial intermediaries to offer compliant, seamless investment experiences tailored to their clients. OTM users bear no risk because the fee only needs to be paid if the fundraising is successful – that is, if more than 33% of the funding target has been met.

PLMC Bonding

Multipliers and Vesting Periods

Participants can apply in funding rounds based on their participation type. The multiplier then defines the necessary PLMC amount to be bonded and, in turn, determines the duration of the vesting period of their PLMC and mainnet tokens.

The multipliers are implemented considering industry practices and different risk categories of the participant types. The higher the multiplier, the longer the vesting period. For all participants, the vesting period of the PLMC bonded to participate in the funding round starts 7 days after the funding round is completed. Contribution tokens are transferability-locked until mainnet launch of the respective project, at which time the contribution tokens are converted to mainnet tokens. For mainnet tokens, the vesting period starts 7 days after the project’s mainnet launch. For both PLMC and mainnet tokens, vesting periods are subject to individual linear unbonding illustrated below.

Linear vesting schedule:

Multiplier

Weeks after Successful Funding Round/Mainnet Launch

2.17

4.33

6.50

8.67

10.83

15.17

17.33

19.50

21.67

23.83

28.17

30.33

32.50

34.67

36.83

41.17

43.33

45.50

47.67

49.83

Retail participants can participate with up to 5x the value of PLMC bonded for a funding round. Retail participants determine which multiplier they want to apply when participating in a funding round. Depending on the applied multiplier, retail participants are subject to varying vesting periods on the PLMC, and any mainnet tokens received in return for their participation. The unbonding of the total amount varies between 0-8.67 weeks (with linear unbonding).

Professional participants can participate with up to 10x the value of PLMC bonded for a funding round. Professional participants determine which multiplier they want to apply when participating in a funding round. Depending on the applied multiplier, professional participants are subject to varying vesting periods on the PLMC, and any mainnet tokens received in return for their participation. The unbonding of the total amount varies between 0-19.5 weeks (with linear unbonding).

Institutional participants can participate with up to 25x the value of PLMC bonded for a funding round. Institutional participants determine which multiplier they want to apply when participating in a funding round. Depending on the applied multiplier, institutional participants are subject to varying vesting periods on the PLMC, and any mainnet tokens received as a result of their participation. The unbonding of the total amount varies between 0-52 weeks (with linear unbonding).

Multipliers, vesting periods, and vesting schedules for the different participation categories:

Retail

Professional

Institutional

Multiplier

1x-5x

1x-10x

1x-25x

Vesting Period

0-8.67 weeks

0-19.5 weeks

0-52 weeks

Vesting Schedule

Linear unbonding

Reward Payouts

Issuer Fees

Projects raising funds on Polimec only pay a percentage fee in relation to the total fundraising amount in their contribution token if the funding round completes.

Issuer fee schedule:

Total Amount Raised (x)

Fee

x≤1m USD

10%

1m<x≤5m USD

8% for any additional USD raised

x>5m USD

6% for any additional USD raised

The following threshold applies to the total amount raised relative to the target funding amount.

Possible outcomes:

Thresholds

Outcome Project

Outcome Evaluators

Outcome Participants

<33%

Rejected (autom.)

Slashed

Refunded

≥33%

Accepted (autom.)

Rewarded

Receive Contribution Tokens

Should the total amount raised fall at a level of 33% or above of the target funding amount, the protocol automatically accepts the funding, evaluators are rewarded in the respective contribution tokens based on the amount raised for the project, and participants receive the respective contribution tokens based on their participation.

Based on the total amount raised compared to the target funding amount, the funding is automatically accepted or declined. The applicable settlement will occur 1 hour after the automatic outcome.

Evaluator Rewards

The evaluator rewards are contingent upon two elements. Firstly, the ratio between the total amount raised and the target funding amount and secondly, whether the funding is accepted. In the event that the funding is declined, there will not be any issuer fees to be apportioned to the evaluators. Conversely, if the funding is accepted and there are issuer fees to be distributed, the proportion between the total amount raised and the target funding amount defines the distribution to liquidity pools, long-term holder bonuses, and ultimately, evaluator rewards.

Should the funds raised fall below 33% of the target funding amount, the allocation would look as follows:

Liquidity Pools: 0%
Evaluator Rewards: 0%
Long-Term Holder Bonus: 0%

In this case, the protocol has an automatic rejection mechanism. As a result, the protocol obviates the imposition of issuer fees. However, evaluators get slashed 20% of their PLMC as their prediction was wrong. These PLMC are then transferred to the on-chain treasury.

Should the total amount raised fall at a level of 33% or above of the target funding amount, the allocation would look as follows:

Liquidity Pools: 50%
Evaluator Rewards: 30%
Long-Term Holder Bonus: 20%

This mechanism encourages evaluators to only back projects they consider to have an above-average success probability. It consequently ensures that only projects deemed promising by the community are made available to participants.

The protocol further distinguishes between two categories of evaluators, allocating 80% of the evaluator rewards pro rata to all evaluators, and the remaining 20% solely to early evaluators, defined as those who bonded their PLMC prior to the 10% evaluator bonding threshold being reached.

Issuance and Distribution

Throughout the history of token-based fundraising, projects have used various ways to distribute tokens. However, the processes, terms, and methods of the actors involved in common distribution forms tend to be cumbersome, highly trust-based, and time and cost inefficient for issuers and participants.

The issuance and distribution mechanism on Polimec eliminates the complexities of token distributions for issuers while ensuring transparency and a smooth allocation process for token recipients. The rule-based framework governs the transfer from the modules to the various network participants, eliminates counterparty risks, and introduces accountability and censorship resistance.

For finalizing the funding round and issuing the contribution tokens to participants, the issuer calls the relevant network function with the following parameters, signed with the issuer’s DID and credential identifying them as the issuer:

Instance of the funding round
Hash of instance-specific KYC/AML-credential

Once all parameters are set and verified by the protocol, the contribution tokens are issued to the participants according to the balances determined by the funding module at the end of the funding round. The additional allocation of contribution tokens is settled to the treasury module for incentivizing other network participants through the evaluation and liquidity pool module.

At the same instant, the total funds raised are transferred to the issuer account and will be at their complete disposal.

Migration to Mainnet

Generally, token distribution plans include various distribution modes to launch the issuer’s mainnet. Instead of factoring all the complexity into the genesis block of a mainnet, Polimec allows this to be set in the contribution token phase to be later migrated to its mainnet. Designing and integrating such complexity directly into the contribution tokens generates trust and transparency.

On Polimec, the instance-ID of the contribution token and all contribution token balances are migrated to the new mainnet leveraging XCM to ensure that assets are not lost or duplicated across multiple chains.

Contribution token issuance and mainnet migration:

Furthermore, the token distribution process can implement particular balances owned by the issuer or under the control of trusted entities. They can serve as a contribution token reserve for the team, early participants, a foundation, or bounty programs. These accounts are maintained directly by the issuer without any funding token equivalent being transferred. This functionality increases transparency in funding rounds as it shows the exact amount of issued tokens and stores corresponding transaction data .

Today, projects more frequently explore other designs for token distributions with growing popularity. Airdrops of different forms have gained prominence, especially by allocating tokens to target user groups based on network contribution or interest to bootstrap a network at launch. This proved effective in raising awareness and distributing tokens widely if structured correctly. In particular, such an approach may be appropriate for projects aiming to distribute tokens and incentivize participation amongst a specific audience of potential users that have funding support for network development through other means. Airdrops represent a functionality of Polimec as they support the creation of a user base for the contribution token. Issuers can manage airdrops by engaging with their community to request their Polimec addresses and valid on-chain verification for .

Calculation Example

Onboarding

Polimec ensures regulatory-compliant decentralized fundraising by implementing strict KYC/AML verification through trusted third parties. Participants can verify their identity via In-App user verification.

Funding Application

This example, along with the numbers presented in other chapters, has been randomly generated solely for illustrative purposes.

Example of contribution token registration:

Contribution Token Registration Parameters

Example

Name

Nexa

Ticker

NXTK

Smallest Denomination (of NXTK)

0.0000000001

Total Allocation of Contribution Tokens Available for the Funding Round

100,000

Minimum Price per Contribution Token (in USD)

Target Funding Amount in USD Equivalent

1,000,000

Maximum and/or Minimum Ticket Size

N/A

Participation Currencies (e.g. USDT, USDC, DOT, ETH)

USDT

Issuer Destination Account for Accepted Participations Currencies (for Receiving Contributions)

N/A

Evaluation

Target funding amount: USDT 1,000,000
10% (threshold) of target funding amount: USDT 100,000

Evaluators bonding PLMC during the evaluation period:

The 10% (threshold) of the target funding amount represents the minimum level of support required from evaluators for a project to progress to the funding round. This threshold requires evaluators to bond PLMC equal to 10% of the target funding amount. This approach prevents unrealistic or excessively high valuations, as well as participants getting stuck in an unsuccessful funding round without the economical means to deliver on their planned endeavors.

After 7 days, and given that the total USD amount of PLMC bonded by evaluators is USDT 200,000 (as shown in the example), and the total USD amount of PLMC required to meet the 10% evaluator bonding threshold is USDT 100,000, the project successfully progresses to the funding round.

Funding Round

Total allocation of contribution tokens available for the funding round (Q₀): 100,000
Minimum price per contribution token (P₀): USDT 10

Following, an example is used to simulate the funding round, with the numbers being generated randomly.

Participants bidding in the funding round:

The protocol automatically defines the winning bids using the following procedure:

Identifies eligible bids
Ranks bids from highest to lowest and sorts bids from latest to earliest

1. Identifies eligible bids

The funding round ends after 14 days and the participants with the highest bids win. In addition, the protocol promptly rejects bids that are below the minimum price per contribution token, without allowing them to be submitted.

When the allocated amount of contribution tokens for the funding round is reached, the protocol generates new tranches. In the example above, the threshold is reached when Anna placed a bid of 20,000 contribution tokens at the minimum price of USDT 10 per contribution token. Until this point, participants could submit bids at the minimum price of USDT 10 per contribution token.

In oversubscribed rounds, the highest-ranked bids are accepted, while the lowest-ranked bids are excluded. Each tranche is allocated a fixed amount of 10% of Q₀ which, in this example, is 10,000 contribution tokens. In addition, referring to the formula above, the price development for this example unfolds as follows:

P₀=USDT 10
P₁=P₀+(P₀x0.1)=USDT 10+(USDT 10x0.1)=USDT 10+USDT 1=USDT 11

For each new tranche, the price develops in a linear fashion, requiring the complete filling of the preceding tranche with bids at the corresponding price to advance to the next tranche.

Example of an oversubscribed funding round:

2. Ranks bids from highest to lowest and sorts bids from latest to earliest

As a next step, the eligible bids are ranked from highest to lowest bid price and also from latest to earliest:

Participant

Bid Price

Contribution Tokens

USDT Bid

Damian

USDT 11

10,000

USDT 110,000

Anna

USDT 10

20,000

USDT 200,000

Fred

USDT 10

10,000

USDT 100,000

Sofia

USDT 10

10,000

USDT 100,000

Crp VC

USDT 10

40,000

USDT 400,000

Adam

USDT 10

20,000

USDT 200,000

As the total amount of contribution token bids exceeded the contribution tokens allocated to the funding round, there was an adjustment in the genesis tranche. Anna’s contribution token amount was reduced to 10,000. This adjustment is due to the fact that she placed the most recent bid at the minimum price per contribution token. The difference of 10,000 contribution tokens is allocated to Damian. Damian filled the most recent tranche of 10,000 contribution tokens at USDT 11, representing the highest price.

Participant

Bid Price

Contribution Tokens

USDT Bid

Damian

USDT 11

10,000

USDT 110,000

Anna

USDT 10

10,000

USDT 100,000

Fred

USDT 10

10,000

USDT 100,000

Sofia

USDT 10

10,000

USDT 100,000

Crp VC

USDT 10

40,000

USDT 400,000

Adam

USDT 10

20,000

USDT 200,000

Participants can participate with any cryptocurrency accepted by the issuer. The conversion rate for the participation currency (e.g. USDT, USDC, DOT, ETH) to USD applies at the time of placing the bid.

Participation Options

There are two ways to participate on Polimec: Bonding PLMC, where users use their own PLMC tokens, or the One Token Model (OTM), which allows participants to borrow PLMC from Polimec’s on-chain treasury, eliminating the need to hold PLMC.

PLMC Bonding

Continuing from the previous example, the multipliers are applied to the very same participants of the funding round. These multipliers are simulated and generated randomly.

Funding round example with multipliers and vesting periods:

Participant

Damian

Anna

Fred

Sofia

Crp VC

Adam

Participant Type

Professional

Retail

Institutional

Professional

Bid Price

USDT 11

USDT 10

Contribution Tokens

10,000

40,000

20,000

USDT Bid

USDT 110,000

USDT 100,000

USDT 400,000

USDT 200,000

Multiplier

10x

25x

PLMC Bonding (worth of PLMC)

USD 11,000

USD 50,000

USD 100,000

USD 20,000

USD 100,000

USD 40,000

Vesting Period PLMC*

~19.5 weeks

~2.2 weeks

N/A

~8.7 weeks

~52 weeks

~8.7 weeks

Vesting Period Contribution Tokens**

~19.5 weeks

~2.2 weeks

N/A

~8.7 weeks

~52 weeks

~8.7 weeks

*starts 7 days after successful funding round **starts 7 days after the project’s mainnet launch

One Token Model

Let’s assume Sofia participates using the OTM instead of bonding PLMC. She bids for 10,000 contribution tokens at the price of USDT 10, making her total bid USDT 100,000. Since the multiplier is set at 5 – as with the OTM – she needs to bond USD 20,000 worth of PLMC. With a price of USD 0.20 per PLMC, this equates to 100,000 PLMC.

Since Ella does not have PLMC, she would borrow the utility from Polimec’s on-chain treasury and pay a 1.5% fee on her total ticket size, which amounts to USD 1,500. This fee depends on the participation currency – in this case USDT – and is deducted from the total ticket size. As a result, Ella’s total ticket size is USDT 98,500 and USDT 1,500 would go to Polimec’s on-chain treasury.

Rewards Payout

Issuer Fee Calculation

With the total funding amount raised being USDT 1,010,000, the issuer will have to pay an issuer fee in their contribution token depending to the raised amount, as per fee schedule.

Therefore, the calculation for the issuer fee is as follows:

Total Amount Raised (x)

Fee

Example

x≤1m USD

10%

1m<x≤5m USD

8% for any additional USD raised

x>5m USD

6% for any additional USD raised

N/A

Total Issuer Fee

USDT 100,800

This equals an issuer fee of approx. or . Note that the issuer fee in contribution tokens, i.e. 9,980, is separate from the contribution tokens, i.e. 100,000, sold in the funding round.

Issuer Fee Allocation

It is imperative to note that the issuer fee, equivalent to USDT 100,800, is paid in the form of contribution tokens in accordance with the fee schedule. This fee is then fully allocated to the on-chain contribution treasury to incentivize and reward network participants.

As the target funding amount of USD 1,000,000 is met by the total funding amount raised, which equals USD 1,010,000, it can be deduced that the project has achieved over 100% of its target funding. Thus, the allocation of the issuer fee proceeds as follows:

Liquidity Pools: 50%
Evaluator Rewards: 30%
Long-Term Holder Bonus: 20%

In this example, the issuer fee allocated in contribution tokens to the evaluators is .

Evaluator Rewards Allocation

In this example, the successful attainment of the target funding amount triggers the automatic acceptance of funds and the subsequent distribution of evaluator rewards in contribution tokens.

In accordance with the bonded PLMC threshold of 10%, the protocol designates two portions of the rewards. A proportion of 80% is allocated pro rata among all evaluators, while the residual 20% is earmarked exclusively for those who participated as early evaluators by bonding their PLMC prior to the achievement of the 10% bonding threshold.

All evaluator rewards:

Evaluator

Weight

Rewards

Valeria

Tim

Marc

The distribution of evaluator rewards among Valeria, Tim, and Marc is determined in proportion to their respective contributions to the total USD amount of bonded PLMC, which stands at USDT 200,000.

Early evaluator rewards:

Evaluator

Weight

Rewards

Valeria

Tim

Marc

not entitled

not entitled

The rewards earned by early evaluators, i.e. evaluators Valeria and Tim, are augmented by an additional 20% of the total rewards as a means of incentivizing early participation in project evaluations and deterring free riding.

The allocation of rewards between evaluators Valeria and Tim is determined proportionally to their contribution towards the 10% evaluator bonding threshold of USDT 100,000.

Thus, the individual evaluator rewards in this example are:

Evaluator

All Evaluator Rewards

Early Evaluator Rewards

Total Evaluator Rewards

Valeria

898.20

449.10

1,347.30

Tim

778.44

149.70

928.14

Marc

718.56

not entitled

718.56

White-Label Solution

Polimec is advancing its decentralized fundraising infrastructure by introducing a comprehensive white-label solution designed for financial intermediaries. This product provides secure access to decentralized finance (DeFi) for financial services, enabling financial intermediaries to offer multichain Web3 investment opportunities directly to their clients.

By adopting this approach, Polimec not only enhances its platform's capabilities but also provides financial intermediaries with a unique opportunity to expand their service offerings, while retaining client assets, and generating new revenue streams.

Financial intermediaries remain in complete control with regards to funding rounds made available to their clients. With users being within their environment, financial intermediaries can ensure a seamless user experience and that their brand identity and client relationships are maintained. As a settlement infrastructure, the white-label solution covers mid- and back-office processes, eliminates operational inefficiencies and reduces overhead, without any running costs or fees charged by Polimec. Moreover, Polimec's regulatory-compliant protocol manages settlement and token handling, eliminating counterparty risk by ensuring that clients' assets remain within the financial intermediaries' environment, thereby securing transactions.

Benefits for Financial Intermediaries

Financial intermediaries stand to gain substantial advantages from this white-label solution:

Expanded Investment Offerings: Financial intermediaries can provide their clients with access to a curated selection of multichain Web3 investment opportunities. This diversification meets the growing demand for digital assets and positions financial intermediaries at the forefront of financial innovation. Asset managers and banks have the possibility to either make funding rounds performed on Polimec (App) accessible to their clients if they meet the financial intermediaries' requirements, or settle their own funding rounds leveraging the Polimec infrastructure independently.
Seamless Integration and Control: The solution integrates effortlessly into existing platforms, allowing financial intermediaries to maintain control over the user interface and experience. This ensures consistency with their brand and prevents disruption to their established client interactions or clients being redirected to other platforms for investing in Web3 projects.
Cost Efficiency: With fully automated processes and no associated running costs or fees, financial institutes can enhance their service offerings without incurring additional expenses. This efficiency translates into higher profitability and competitive pricing for clients. As a consequence, all fees charged by intermediaries' towards their end clients accrue fully as PnL.
Asset Retention: By offering decentralized investment opportunities within their own platforms, intermediaries prevent asset outflows to external providers. This retention strengthens client relationships and increases assets under management.
Elimination of Counterparty Risk: Polimec's regulatory-compliant protocol manages settlement and token handling, mitigating risks associated with counterparties. This assurance enhances trust and reduces the compliance burden on intermediaries.

Direct Monetization Streams

The white-label solution opens up direct monetization avenues for financial intermediaries, such as:

Transaction Fees: Financial intermediaries have the flexibility to charge ticket or wallet handling fees for each client participation. Since Polimec does not charge fees on these transactions, intermediaries can establish their own fee structures.
Monetization of the User Journey: Beyond transaction fees, intermediaries can capitalize on the entire user journey and create relevant spill-over to their established services and products. This includes cross-selling and upselling of existing services, such as listing, trading, custody, and market making. By integrating these services, intermediaries enhance client engagement and create additional revenue streams.

Importance of the White-Label Solution

The integration of financial intermediaries into Polimec's infrastructure is a strategic move that significantly broadens the reach and adoption of decentralized fundraising. By collaborating with established financial entities, Polimec accelerates the mainstream acceptance of DeFi solutions, bridging the gap between traditional finance and blockchain-based innovations. This approach not only diversifies the investment opportunities available to end clients but also strengthens the overall financial ecosystem by promoting transparency, security, and regulatory compliance leveraging decentralized technologies for the settlement of on-chain investments.

Tokenomics

PLMC Metrics

Network: Layer 1 on Polkadot (parachain)
Native Token: PLMC
: 100 million PLMC*
Inflation: 0%*
Smallest Denomination: 10-10 (0.0000000001 PLMC)
Existential Deposit: 0.01 PLMC
Block Time: ~6 seconds

*For 4 years following the mainnet launch, the total PLMC supply will be capped at 100 million. The total supply may decrease or increase in the future due to changes enacted by PLMC holders via on-chain governance.

PLMC Functionalities

The Polimec tokenomics are designed to incentivize PLMC holders to actively use the token for its intended purposes on the protocol:

: PLMC holders perform evaluations and signal their confidence in a project by bonding PLMC. Their backing is decisive for a project to proceed to a funding round. Evaluators are rewarded - in contribution tokens of the evaluated project - for correct evaluations, or slashed for incorrect ones.
: PLMC holders gain access to funding rounds by bonding PLMC. They may participate in the funding round with any other cryptocurrency accepted by the projects (e.g. stablecoins or other tokens).
: PLMC holders earn staking rewards by delegating to collators. In doing so, they get rewarded for providing stability to the network and contributing to validating transactions.
: PLMC holders determine the direction of the protocol by deciding on topics such as protocol development, the inclusion of new network features, and treasury management.

PLMC Lock Types

Polimec implements distinct PLMC lock types. For each lock type, the PLMC holder retains certain action-specific permissions (see table below). For example, all locks still allow voting in governance, and no lock allows for transfers. This has the goal to align the interests of all network participants on Polimec.

Possible actions under the various lock types:

Evaluation Lock

The evaluation lock is activated once PLMC has been bonded to evaluate a project. The evaluation lock is active until the completion or cancellation of the funding round. An evaluation period lasts 7 days and is followed by a funding round which last for a maximum of 14 days. The community round, however, can end earlier in the case that all contribution tokens available for sale are allocated to participants. PLMC bonded for evaluation cannot be transferred, staked, or used for evaluating other projects simultaneously. However, PLMC bonded for evaluation can still be used to participate in funding rounds for that same project only, and voting in governance.

Participation Lock

The participation lock is activated once PLMC has been bonded to participate in a funding round. The bond restricts the ability to transfer, evaluate, participate, and stake. Depending on the participation type and the multiplier chosen, participants are subject to varying vesting periods on the PLMC, and mainnet tokens received as a result of their participation. The unbonding of the PLMC starts 7 days after the fundraise and varies between . In contrast, the unbonding of the mainnet tokens starts at the tokens’ mainnet launch, for the same linear unbonding period as applied to the PLMC.

Long-Term Holder Bonus Lock "Soft Lock"

The long-term holder bonus lock is activated once PLMC has been bonded to participate in a funding round. The PLMC can still be used for evaluations, participations, staking, and voting, without losing the eligibility for the long-term holder bonus. The token holder must wait to transfer any of the mainnet tokens until 18 months after the mainnet launch of the project in which they participated. Although transfers are still possible, they will lose entitlement to the long-term holder bonus.

Staking Lock

The staking lock is activated once PLMC has been bonded for staking. The bond restricts the ability to transfer, evaluate, participate, and stake. The unbonding period takes 7 days; during this time, no rewards are paid out.

Governance Lock

The governance lock is activated once PLMC has been bonded to vote and follows a similar logic as the one applied for on Polkadot. The unbonding period of PLMC bonded for governance depends on the conviction multiplier used and lasts 7 days for a 1x conviction multiplier. The bond restricts the ability to transfer.

PLMC Transaction Fee Types

Transaction fees serve as an economic incentive to encourage efficiency in execution time, computation, and the number of calls required for operations. The protocol incorporates a minimal transaction fee that varies based on transaction types to prevent denial-of-service attacks by malicious actors. Polimec calculates an appropriate transaction weight by using benchmark parameters to measure the time it takes to execute function calls on various hardware, with different variable values, and repeated multiple times. The weights derived from these benchmarks are used as the basis for calculating transaction costs.

Polimec imposes transaction fees on certain transaction types only, such as PLMC transfer, funding application, staking, and governance. All transaction fees flow into the blockchain operation treasury to sustain operations. Some transaction types, such as evaluation and participation, are exempt from transaction fees.

PLMC Allocation

Polimec Foundation initially issues and distributes PLMC as per the schedule below:

At the token generation event (TGE), PLMC will have a total supply cap of 100 million (100%), which will not increase further for the first 4 years. The specific allocation of PLMC is stated below, in percentage of the total supply at TGE as visualized in the pie chart above and defined as follows:

Early Backers (20%): Early investors from a globally diversified stakeholder base provided initial funding for the development of Polimec to have early access to the protocol functionalities with PLMC. This funding enables the Polimec Foundation to deliver its minimum viable product (MVP) and embark on the path toward self-sustainability by attracting initial users, creating a feedback loop that continuously enhances the end-user experience.
Employees, Advisors, and Founders (20%): The token allocation for the development team, which includes employees, advisors, and founders, is designed to align long-term incentives. In the rapidly evolving Web3 environment, it is crucial to continually monitor and respond to market needs. This requires a constant process of assessing, optimizing, developing, and implementing protocol features. The Polimec Foundation was the key driving force behind the initial protocol development and remains a core contributor to the ongoing development of the protocol.
On-Chain Treasury (40%): The primary objective of Polimec’s on-chain treasury for PLMC holders is to ensure the sustainable growth of the network through integration programs and project collaborations, incentivizing network participants, and securing the blockchain infrastructure. For this purpose, Polimec distinguishes between the protocol growth treasury, contribution treasury, and the blockchain operation treasury. Of the initial token supply, 40% is allocated to the on-chain treasury, with 75% designated for the protocol growth treasury and 25% for the blockchain operation treasury. For further information on this topic, visit the .
Foundation Reserve (20%): The long-term reserve for the Polimec Foundation is dedicated to promoting the growth and support of Polimec over several years. This reserve is designed to address future needs and growth opportunities, facilitating a quicker path to the protocol’s self-sustainability through user adoption and network traction.

PLMC Release Schedule

The initial token amount of 100 million PLMC is generated at TGE and will be released as per the graph below. All token functionalities are enabled at TGE, during freeze and respective linear vesting periods, except for transferability. This means that evaluations, bonding for participations, staking, and governance interactions can be conducted using vested PLMC.

On-Chain Treasury

The primary objective of Polimec’s for PLMC holders is to ensure the sustainable growth of the network through integration programs and project collaborations, incentivizing network participants, and securing the blockchain infrastructure. For this purpose, Polimec distinguishes between the protocol growth treasury, contribution treasury, and the blockchain operation treasury.

Protocol Growth Treasury

The protocol growth treasury empowers PLMC holders to fund valuable contributions through governance proposals and grants. It also enables future growth initiatives, such as a single-token model for participations with stablecoins only that allows seamless borrowing of protocol utilities. Furthermore, the allocation supports B2B/B2C integration programs, collaborations with other Web3 projects, additional applications and functionalities, an ambassador program, and community rewards.

Contribution Treasury

The contribution treasury consists of issuer fees denominated in their contribution tokens on Polimec and will capture future treasury inflows from each successful funding round. This treasury serves to incentivize liquidity providers, evaluators, and long-term token holders. It allocates the issuer’s contribution token fees to the respective stakeholders as defined in .

Blockchain Operation Treasury

The blockchain operation treasury is designated to support collators and ensures infrastructure stability without the need for inflating the total token supply. This treasury receives PLMC inflows from slashed evaluators and transaction fees.

High-level overview of Polimec’s on-chain treasury:

Staking

Begin your staking journey with Polimec by delegating your PLMC to the collator(s) of your choice. To delegate your PLMC, visit Polimec's .

Staking Metrics

Block Time: ~12 seconds
Minimum Delegation: 50 PLMC*
First Rewards Payout Delay: ~12 hours (3,600 blocks or 2 rounds)
Round Duration/Rewards Payout Frequency: ~6 hours (1,800 blocks or 1 round)
Rewards Payout: 90% to delegators and 10% to collators
Unstaking Period: ~168 hours/7 days (50,400 blocks or 28 rounds)
Maximum Delegators per Collator: 300

*The minimum delegation of 50 PLMC may vary depending on the number of delegators per collator. This is subject to delegator exhaustion, with a current cap of 300 delegators per collator.

Staking on Polimec

Parachains like Polimec can benefit from Polkadot’s security architecture by introducing collators. Akin to validators on the Relay Chain, in parachain networks, collators play a critical role in maintaining the parachain’s functionality by aggregating transactions from users on the parachain and generating for Relay Chain validators.

For this purpose, collators maintain a full node for the Relay Chain and another one for the corresponding parachain. This enables collators to retain all necessary information to author new blocks and execute transactions. In the normal course of operations, transactions are collated and executed to produce an unsealed block, which is furnished, along with a , to one or multiple validators responsible for proposing a parachain block.

Similar to , where DOT holders can participate as nominators, Polimec’s delegated proof-of-stake (DPoS) mechanism enables PLMC holders to act as delegators. By delegating PLMC to collators, delegators are eligible to receive rewards in PLMC in return. This process, referred to as staking, closely mirrors the procedure for DOT holders on the Relay Chain. During staking PLMC, a staking lock is activated, restricting transfers, evaluations, and participation in projects using the staked PLMC.

Staking Rewards

Each round, collator candidates are selected to join the active set, which is capped at 10 collators. If there are 10 or fewer collators, a selected candidate of the active set needs only a minimum self stake of 20,000 PLMC. Conversely, if more than 10 collators compete for the active set, only the 10 collators with a self stake of minimum 20,000 PLMC and with the highest total delegation (self stake plus delegator stake) become the selected candidates of the active set.

Each round consists of 1,800 blocks, distributed equally among the active collators using . Every block produced by a collator earns them 20 points for the round, with a maximum of per round. A collator’s share of the PLMC distributed each round is determined by dividing their score by the total points.

Calculation Example - Staking

Let’s assume that 750 PLMC is distributed for a round on Polimec. Recall that 90% is paid out to delegators and 10% to collators. Thus, is distributed to collators. Since the blocks are distributed equally among the active collators, and there were 10 active collators, each had the opportunity to create a maximum of during this round. However, collators can create more than 180 blocks in a round, particularly when other collators in the active set miss their blocks.

Collator

Generated Blocks

Missed Blocks

A total of 51 blocks - and thus 1,020 points - were reassigned. The Rewards Payout per Collator is calculated as:

To calculate the Rewards Payout per Collator, one must divide the points earned by each collator in that round by the total round points. Then, multiply this figure by the 10% allocation designated for collators, i.e. 75 PLMC. This means that a collator’s PLMC payout depends solely on their performance - specifically, on not missing any blocks - and is not determined by their total PLMC delegations once they have joined the active set.

However, the Rewards Payout for Delegators has not been considered yet. Since they constitute 90%, 675 PLMC is distributed to delegators. The Rewards Payout to Delegators is calculated as:

To calculate the Rewards Payout to Delegators, one must multiply the total round PLMC allocation by the 90% allocation designated for delegators, i.e. 675 PLMC.

In a next step, the Rewards Payout per Delegator is calculated and distributed pro rata among all delegators of that collator:

For simplicity, let's assume that Collator 1 has only 2 delegators - Delegator 1 and Delegator 2 - each of whom delegated an equal amount of 15,000 PLMC. Therefore, calculating the Rewards Payout per Delegator would involve:

It is important to note that the collators have a self stake of, i.e. 20,000 PLMC in the delegator allocation, and thus in Rewards Payout to Delegators. However, this portion of the rewards belongs to the collator. Therefore, considering the ratio of self stake to delegator stake, the Final Rewards Payout per Collator is calculated as:

The following table provides these calculations, with the delegator stakes being assumptions.

Collator

Self Stake

Delegators Stake

Total Stake per Collator

Rewards Payout Collator

Rewards Payout Delegators

When all the numbers are added up, the following final rewards payout for collators and delegators emerge:

Collator

Final Rewards Payout per Collator

Rewards Payout Delegators

Total Rewards Payout

If a collator fails to perform their required functions, no rewards will be distributed, including for their respective delegators. If a parachain block is invalid, validators will reject it, and the affected collators will lose further validator backing. This differs from validators and their nominators on the Polkadot Relay Chain, as they face slashing risks for erroneous or malicious behavior. Hence, there is no slashing for collators on Polimec.

Relationship between the Polimec parachain and the Polkadot Relay Chain:

Governance

Polimec’s governance structure mimics Polkadot’s governance v1, incorporating PLMC holders (hereafter referred to as "the public"), a council, and a technical committee, all of which are designed to ensure the efficient oversight and management of the network.

Polimec’s governance mechanism is based on proposals. Proposals are certain actions on the blockchain such as code changes which can be suggested by the public or council and generally lead to referenda which are put up for voting. If successful, the proposed blockchain actions are executed by the protocol.

Polimec’s high-level governance structure:

Proposers

The Public

All PLMC holders, i.e. the public, can submit proposals that are categorized into public or treasury proposals.

Public proposals progress through a public proposal queue and gain priority based on support, ultimately evolving into referenda with positive turnout bias.

On the other hand, treasury proposals require an assessment by the council through a council motion, leading to their placement in the council proposal queue. They either result in referenda with positive turnout bias (5/9), simple majority (6/9), or negative turnout bias/direct execution (9/9). In the latter case, 9/9 council approval for a council motion, the council will generally opt for a direct execution unless there are special reasons for holding a referendum.

The Council

Council and Prime Member

The council is made up of 9 members. However, the number of council members can change over time. Council members have fixed terms of 4 weeks.

Moreover, the council has a prime member whose vote serves as the default choice for council members who abstain from voting, in cases where a majority decision is not achieved through the council’s votes.

The selection of the prime member is determined through a borda count method. In its simplest form, PLMC holders assign points to council members based on their ranking; one point for the last choice, two points for the second-last choice, and so on. Then, the total points for all members are summed up. The member with the most points is automatically declared the prime member. The prime member’s role is to guarantee that a valid decision is taken, even when some council members abstain from voting.

Council Election

PLMC holders participate in elections to choose council members. Candidates nominate themselves for these elections.

Votes are calculated by the phragmén method. In its simplest form, voters lock PLMC to vote for candidates from the candidates list. On Polimec, voters can simultaneously vote for 1 to 8 candidates using the same amount of PLMC. In each election, the candidates with the highest PLMC total win the seats, taking into account the weighting of the votes from previous elections. As an ongoing process, council candidates retain their votes from the previous election as long as PLMC holders do not change it.

PLMC used to vote for council members are locked for 4 weeks starting from the time of the vote. They remain pledged in support for the candidates until the pledge is revoked. This means PLMC used for elections can be revoked after the lock period has ended or changed at any time, which would renew the lock duration to another 4 weeks. Note that the renewed pledge amount must be equal to or higher than the previous locked amount.

Governance Tasks

In addition to overseeing the treasury, the council is primarily responsible for the following governance tasks:

Submit proposals
Cancel referenda
Elect the technical committee

The council submits council proposals that must undergo a council motion. A council motion cannot be vetoed; however a referendum can be vetoed by a member of the technical committee. If the council motion passes, the council proposal is put up as a referendum. When the majority (5/9) of the council votes for a council proposal, the proposal becomes a referendum with positive turnout bias. On the other hand, when a supermajority (6/9) of the council votes for a council proposal, the proposal becomes a referendum with a simple majority. If there is a unanimous vote (9/9) for the council motion, the council proposal ends up as a referendum with negative turnout bias.

The Technical Committee

The technical committee consists of 5 individuals possessing the technical, business, and other expertise to review proposals and fast-track important ones. The members are added or removed from the technical committee via a council proposal. Given that the council motion passes, and depending on the number of council members in favor of the council motion, the voting scheme adjusts (5/9 for positive turnout bias, 6/9 for simple majority, and 9/9 for negative turnout bias).

The technical committee’s primary objective is to evaluate proposals and to:

Identify malicious proposals
Implement bug fixes
Reverse faulty runtime updates
Implement new, battle-tested features

The technical committee cannot submit proposals, however, it can fast-track proposals with simple majority (6/9) and negative turnout bias (9/9) voting from the council motion. Fast-tracked referenda are the only referenda that can be voted on simultaneously alongside other referenda. The fast track can accommodate multiple proposals. Typically, these referenda have a shorter voting period of at least 1 block and can be enacted immediately, skipping the typical 7-day enactment period. Fast-tracked referenda are designed to address major network issues that require urgent attention.

Proposals

Proposal Types

There are different proposal types that can be submitted:

Different proposal types:

Proposal Type

Proposer

Public Proposal

Public

Treasury Proposal

Public

Council Proposal

Council

Fast-Tracked Proposal

Technical Committee*

*The proposal is submitted by either the public or the council but the technical committee has the authority to fast-track it in the council proposal queue (6/9 and 9/9). This means that, even though it would typically fall under the purview of the public or the council, it is allocated to the technical committee.

Proposal Actions

Supporting Proposals

Anyone can submit a proposal by depositing the minimum amount of 100 PLMC for a certain period, measured in blocks. Submitted public proposals are added to the public proposal queue, where PLMC holders can support the proposals by depositing an equivalent number of PLMC. The proposal that gathers most support - in value, not the number of supporters - will be brought to a referendum in the subsequent voting cycle. For the public proposal queue, the transformation from proposal to referendum is dependent on support, hence the period for a proposal to become a referendum is unknown (indefinite length). Deposited PLMC for support will be returned once the proposal becomes a referendum.

Cancelling Proposals

A proposal can be cancelled by:

Public
Technical committee (5/5)

A cancelled proposal’s deposit is slashed. The slashed deposit from the proposal is transferred to the on-chain treasury, specifically to the protocol growth treasury which - in turn - empowers PLMC holders to fund valuable contributions through proposals and grants.

Blacklisting Proposals

A proposal can be blacklisted by . When a proposal is blacklisted, both the proposal itself and any associated referendum are instantly cancelled. Furthermore, a proposal that has been blacklisted cannot reappear in the proposal queue. Blacklisting serves as a valuable tool for eliminating erroneous proposals with the same hash.

Referenda

Each referendum belongs to a distinct proposal with a blockchain action. They have a fixed 7 days voting period (except fast-tracked referenda) and have predefined voting options, i.e. aye, nay, or abstention. Every 7 days, a new referendum will come up for a vote, assuming there is at least one proposal in one of the queues. There is a public proposal queue and a council proposal queue. The referendum to be voted on alternates between the top proposal in the public proposal queue, where each proposal’s rank is based on support, and the council proposal queue, which contains a maximum of one proposal at a time.

The voting period of 7 days starts once a proposal is selected for a referendum. If the proposal is approved, it will go through an enactment period of 7 days which is the time between the voting for the referendum ends - assuming it was approved - and the changes being enacted. Rejected proposals can be resubmitted. Fast-tracked referenda are the only ones that can be voted on simultaneously with other referenda.

Referendum Types

There are distinct types of referenda, each with different paths to enactment (if the technical committee does not veto it):

Positive turnout bias referendum
Simple majority referendum
Negative turnout bias referendum

The different voting mechanisms revolve around the idea of a changing supermajority based on the percentage of voter turnout.

Behavior of changing supermajority:

Referenda with positive turnout bias must be agreed upon by a supermajority of aye votes to mitigate attacks by malicious or ill-conceived proposals. Conversely, when a proposal is unanimously voted in favor by the council, it benefits from using the negative bias. It is assumed that a low turnout is less problematic if the council proposes a referendum. Also, the council members are elected by the community and have strong technical as well as functional knowledge about the system, and it is assumed that solid justifications back changes proposed by the council.

Positive Turnout Bias Referendum

Referenda with a positive turnout bias are either submitted by the public or the council through a council motion.

In the case of a public proposal, it enters the public proposal queue. If it receives enough support, it will become a referendum with positive turnout bias. In the case of a treasury and council proposal as origin, the council motion can pass with simple majority (5/9) to become a referendum with a positive turnout bias.

A positive turnout bias requires a supermajority of aye votes to carry at low turnouts, but as turnout increases towards 100%, it becomes a simple majority. This is called a positive turnout bias because the required margin of ayes decreases as turnout increases. Thus, the following formula applies:

$\frac{\text{against}}{\sqrt{\text{turnout}}}<\frac{\text{approve}}{\sqrt{\text{electorate}}}$

Approve represents the number of aye votes, while against refers to the number of nay votes. Turnout is defined as the total number of voting tokens, excluding those voluntarily locked. On Polimec, the electorate is defined as a dynamic number, representing the total number of tokens issued on the network minus the tokens allocated to the protocol growth and blockchain operation treasury. Initially, the network issued 100,000,000 PLMC, with 40,000,000 PLMC allocated to the on-chain treasury. Therefore, the initial electorate on Polimec is 60,000,000 PLMC.

Simple Majority Referendum

Referenda with simple majority can originate as either treasury or council proposals.

A simple majority requires more than 50% of the votes to be for a referendum to pass. Thus, the following formula applies:

$\text{approve}>\text{against}$

Negative Turnout Bias Referendum

Referenda with negative turnout bias are originally submitted as a treasury or council proposal. Both proposals have to pass a council motion. If the council motion, in the case of the council proposal as origin, passes unanimously (9/9), it proceeds to the council proposal queue, ultimately leading to a referendum with negative turnout bias.

A negative turnout bias requires a supermajority of nay votes to reject at low turnouts, but as turnout increases towards 100%, it becomes a simple majority. This is called a negative turnout bias because the required margin of nays decreases as turnout increases. Thus, the following formula applies:

$\frac{\text{against}}{\sqrt{\text{electorate}}}<\frac{\text{approve}}{\sqrt{\text{turnout}}}$

Voting on a Referendum

To vote, a voter generally must lock their PLMC for at least the enactment period of 7 days, and thus beyond the end of the referendum. This serves the dual purpose of mandating a minimum economic commitment to the outcome and discouraging the practice of vote selling.

It is also possible to vote without locking, but - given the stake - the vote is worth a small fraction of a normal vote. However, even individuals holding a modest quantity of PLMC can still influence the referendum outcome through conviction voting.

Conviction Voting

Polimec employs a concept known as conviction voting, enabling PLMC holders to increase their voting power on a particular referendum by specifying the duration for which they are willing to lock their PLMC. Hence, the number of votes for each PLMC holder is calculated as follows:

$\text{Votes}=\text{PLMC} \times \text{Conviction Multiplier}$

Correlation between lock periods (in days) and conviction multipliers:

Lock Period (in Days)

Conviction Multiplier

0.1

112

224

The maximum lock period is set to 224 days and thus to a conviction multiplier of 6. Only the predefined lock periods/conviction multipliers are allowed.

During the period of PLMC lock, the voter restricts the ability to transfer. Also conviction lock periods are not cumulative, but based on the longest lock period enabled by each vote. For example, voting with a conviction multiplier of 4 on a referendum locks the tokens for 56 days. If the same account votes with a conviction multiplier of 3, 14 days later in a different referendum, the tokens are locked 28 days from that vote. The longest lock period is enabled, meaning that the tokens will be unlocked 56 days after the first vote (and the second lock period expires during the first lock period).

Example of conviction voting:

PLMC Holder

PLMC

Lock Period (in Days)

Conviction Multiplier

Votes

Kilian

224

Tome

Valentina

Despite Tome and Valentina individually locking a higher amount of PLMC than Kilian, their shorter lock periods result in their voting power being lower than Kilian’s. This is thanks to the power of locking PLMC for a conviction multiplier. Note that the lock period is only enacted for the PLMC voting for the successful outcome of the referendum.

Voting Power Delegations

On Polimec, voting power can be delegated to another trusted account. By delegating to another account, the added voting power of PLMC, along with the specified conviction level, is delegated. Once the delegation is in place, the account being delegated to does not need to take any specific actions. The key difference is that, when the democracy system counts votes, the delegated PLMC gets added to the vote cast by the delegate.

Voting Example

PLMC Holder

Aye/Nay

PLMC

Lock Period (in Days)

Conviction Multiplier

Votes

John

Aye

200,000

600,000

Peter

Aye

100,000

300,000

Nay

150,000

112

750,000

Total

N/A

450,000

N/A

1,650,000

Assumption for this example is that it refers to a referendum with positive turnout bias. Thus, the following formula is selected:

$\frac{\text{against}}{\sqrt{\text{turnout}}}<\frac{\text{approve}}{\sqrt{\text{electorate}}}$

As a next step, the votes have to be calculated:

Approve

Against

Turnout

Electorate

900,000

750,000

450,000

60,000,000

Entering the votes into the positive turnout bias formula shows the following result:

$\frac{\text{750,000}}{\sqrt{\text{450,000}}}<\frac{\text{900,000}}{\sqrt{\text{60,000,000}}}=\frac{\text{750,000}}{\text{670.82}}<\frac{\text{900,000}}{\text{7,745.97}}={\text{1,118.03}}<{\text{116.19}}$

Since the example is a referendum with positive turnout bias, supermajority approval would be used to calculate the result. Supermajority approval requires more aye votes to pass the referendum when turnout is low; therefore, based on the above result, the referendum is declined.

Enactment Period and Enactment

The enactment period is the time between the voting for the referendum ends - assuming it was approved - and the changes being enacted. For referenda, the enactment period is typically a fixed duration of 7 days. However, referenda that are fast-tracked by the technical committee have a shorter voting period of at least 1 block and can be enacted immediately, skipping the typical 7-day enactment period. Fast-tracked referenda are designed to address major network issues that require urgent attention.

FAQ

About Polimec

What is Polimec?

Polimec is a decentralized community-driven funding protocol developed on Polkadot to accelerate the Web3 ecosystem. The open-source and module-based blockchain system facilitates fundraising in a regulatory compliant and sustainable manner.

When was Polimec founded?

Polimec started in late 2020 to realize the vision of the first decentralized, community-driven funding protocol for Web3. Since then, a dedicated team with extensive experience in crypto and financial services has taken on the protocol’s further development and the network’s future launch.

Will Polimec have its own token?

Yes - PLMC, the native Polimec token, grants access to evaluation, participation, staking, and governance. More details on these functionalities can be found here.

Why did Polimec choose to be part of the Polkadot ecosystem?

Polimec builds on the Polkadot ecosystem infrastructure due to its crucial differentiation from other decentralized protocols. One of the differentiating pillars is the security of the blockchain: on Polkadot, every parachain derives its security from the Polkadot Relay Chain and its validators. This ensures that each step on Polimec is safe and trustless. Low transaction fees allow the platform to scale and runtime upgrades enable Polimec to improve consistently and swiftly without requiring time-consuming forks. Lastly, Polkadot enables true interoperability and cross-chain transfers of any type of data or asset. The ability to interoperate with various blockchains is critical for a thriving fundraising ecosystem and leveraging network effects.

Community

Who can use Polimec, and who is the target group?

Polimec brings together all stakeholders required for sustainable project funding and aligns their multifaceted interests. Polimec’s decentralized and permissionless approach welcomes and grants access to everybody. Nevertheless, to perform various actions, such as evaluation, participation, staking, and governance, network participants must complete a KYC/AML process executed by a trusted third party to ensure regulatory compliance. The following network participants are involved in funding rounds on Polimec:

Issuers who raise funds
Evaluators who evaluate projects
Participants who participate in funding rounds

You can join the community and follow any development on the official Polimec channels:

Can I open an unofficial Telegram channel?

The Polimec community is free to open any unofficial channels for discussions among peers. In fact, Polimec encourages the creation of such groups if none are available in your language. However, the community is kindly asked to label the group as "unofficial" to avoid any confusion. For further information/guidance, please contact one of the admins in the official Polimec Telegram group.

Where can I find Polimec’s logo and brand assets?

Polimec is for everyone. However, the community is kindly asked to treat Polimec brand assets with care and with good intentions only. You can find the Polimec brand assets under the brand assets section.

Development

Where can I track the progress of Polimec?

Polimec offers different ways for its community to stay updated on new developments. You can subscribe to the Polimec newsletter, where you will be the first to find out about the most important updates, or follow us on our various social media channels. Join our official channels below:

If you are starting your Polimec journey, check out the Polimec roadmap to learn more about past and future milestones.

At what stage is development now?

To find out about current and coming stages of development, have a look at the Polimec roadmap.

Which technology is Polimec using?

Polimec is built on Substrate. Substrate-based chains are designed to seamlessly connect to Polkadot, granting access to its system of parallel transactions, cross-chain transfers, and an expanding support network. Parity Technologies uses Substrate to build Polkadot, which attests to its high degree of performance, flexibility, and robustness. Much of what makes Substrate a flexible and extensible framework for creating mission-critical software is due to Rust: a fast and memory-efficient language with no runtime or garbage collector. Its type system also guarantees memory safety and thread-safety, allowing Polimec to eliminate many classes of bugs at compile-time.

How does Polimec ensure the highest coding standards?

Polimec ensures the highest standards by hiring the best talents available. For example, Polimec hired one of the graduates of the first Polkadot Academy in Cambridge, where he demonstrated his expertise in Rust and Substrate. To maintain this standard, Polimec has proven its value and was accepted to the Substrate Builders Program introduced by Parity Technologies (creator of Substrate) to receive support systematically, including comprehensive assistance and advice. Additionally, Polimec performed a security audit before go-live to ensure best industry practice.

Differentiator

Why do we need Polimec?

Centralized funding platforms and other intermediaries act as gatekeepers for the crypto industry by imposing non-transparent terms and processes on issuers and participants in their self-interest. Thus, the current fundraising options suffer from several shortcomings, such as time and capital inefficiencies, the administrative burden in fundraising and token distribution, closed accessibility in deal participation, and intransparency of fundraising terms and history.

Polimec solves these issues and provides an automated framework for optimal economic incentivization and sustainable value creation by being committed to the following values:

Trustless: Polimec enables regulatory compliant fundraising without intermediaries or counterparty risk in a permissionless system.
Collaborative: Polimec empowers participants to assess projects in a decentralized due diligence mechanism as their backing is decisive for funding.
Accessible: Polimec facilitates global access to funding on a level playing field, allowing retail and professionals to participate alongside institutionals.
Inclusive: Polimec provides access to a broad and diverse community, coupling community building with a solid participant base for the benefit of all. Polimec reduces information asymmetry in funding through transparency in entry prices, vesting periods, and token allocations.
Transparent: Polimec reduces information asymmetry in funding through transparency in entry prices, vesting periods, and token allocations.
Efficient: Polimec provides a trustless and automated funding process from fundraising to token distribution to the conversion at the project’s mainnet launch.

What makes Polimec different from other funding platforms?

The competitive advantage of Polimec lies in the incentive alignment of the platform. Polimec utilizes the Polkadot blockchain for triple ledger accounting, with all modules being on-chain. This enables Polimec to mitigate counterparty risks, provide instant delivery vs. payment, transparency, and to grant 24/7 uptime of the platform. Polimec additionally outsources the selection of deals which can raise funds to various investor types rather than acting through a centralized committee.

As a result, Polimec eliminates the pay-to-win structure to raise funds on the platform. These features combined make Polimec a trustless, transparent, rule-based system. It enables fundraising for more significant or smaller projects, which cannot or do not want to use existing launchpads/centralized providers.

Polimec differentiators:

Regulatory clarity
No counterparty risk
No upfront fee for issuers or participation fee
Transparency

What are the benefits of a decentralized funding mechanism?

Centralized counterparties suffer from several shortcomings, prohibiting them from aligning the interests of all stakeholders. They are known for time and cost inefficiencies, extensive administrative burdens, selective accessibility, and intransparency in pricing and procedures. Decentralized structures allow stakeholders to align themselves by allowing the following key features:

In-App verification enables pseudonymous yet fully regulatory-compliant funding.
Automation of administrative overhead through on-chain settlements.
Increased time and capital efficiency and lower geographical entry barriers.
Removal of counterparty risk.
All steps, such as token issuance, distribution, and process documentation, are automated on-chain.

Is Polimec a launchpad?

Polimec is not a launchpad; it is much more. These are the key differentiators:

Polimec enables projects to outsource the selection of deals which can raise funds to various investor types rather than acting through a centralized committee.

This mitigates the pay-to-win structure to get a raise on the launchpad by paying the provider more.

Polimec pools various participant types together in the funding rounds and enables open access to and for a broad and diverse participant base. Launchpads, on the other hand, limit exposure exclusively to their client base, which is limited to one of the participant types or people in the know.

Polimec aligns the incentives of the various network participants during and beyond a fundraise and utilizes the Polkadot blockchain for triple ledger accounting with all modules being on-chain. This combination enables the mitigation of counterparty risks, increases transparency, and ensures 24/7 uptime.

Lastly, Polimec alternatively allows using assets with low volatility, such as stablecoins to fund deals. This makes it more attractive for risk-averse participant types, rather than requiring participation with a currency dictated by the launchpad.

Therefore, Polimec can be considered as the next step in the evolution of launchpads in a regulatory compliant manner.

Regulatory Basis

What is AML?

AML is an abbreviation for "Anti Money Laundering" and refers to a set of laws, regulations, and procedures aimed at uncovering efforts to disguise illicit funds as legitimate income.

What is KYC?

KYC is an abbreviation for "Know Your Customer" and refers to standards used to verify identities. Polimec utilizes In-App verification by specialized, trusted third parties to ensure adequate knowledge and verification of all network participants.

What does regulatory compliant DeFi mean?

Regulatory compliant DeFi means engaging in DeFi functionalities or applications while adhering to laws, regulations, and guidelines regarding KYC, AML, or other applicable requirements governing the respective activity.

Does Polimec take on the regulatory compliance and responsibility on behalf of the network participants?

No, Polimec is a decentralized, open, and trustless protocol used and accessed directly by various network participants. As such, Polimec does not operate on behalf of the network participants or ensure compliance with regulatory requirements on their behalf. However, the tools and processes implemented on Polimec and its partner network allow the network participants to comply with regulatory requirements which apply to them.

Others

Does Polimec have its own wallet?

No, this is currently not planned. However, Polimec’s native token PLMC is compatible with various Polkadot wallets. More details can be found here.

Where can I find a list of resources on Polimec?

You can find resources such as the whitepaper and lightpaper on polimec.org.

Who can I contact for a partnership or press inquiries?

For partnership or press inquiries, please reach out to [email protected].

Does Polimec have a staking mechanism?

Yes, the staking module allows PLMC holders to bond PLMC and earn rewards. The staking module locks the PLMC for earning rewards and requires an unbonding period of 7 days before they are transferable. During the unbonding period, the staking module does not pay out rewards.

Based on the inflation model, the Polimec treasury funds staker and collator rewards. PLMC holders earn staking rewards by nominating collators which provide stability to the network. Collators are indirectly responsible for the network security since that is derived from Polkadot’s Relay Chain. However, rewards will be sufficient to run stable collator nodes for Polimec.

Glossary

Airdrop

Distribution of a token or other digital assets to reward a project’s community based on certain eligibility criteria.

API

Application Programming Interface is a publicly available interface that allows developers to access and interact with the functionalities of a particular software or platform.

Bonding

Locking up tokens as collateral to participate in consensus protocols, secure the network, and earn rewards.

Bootstrapping

Self-launching a business without or with only minimum external capital.

Bounties

Rewards offered to individuals or groups for completing specific tasks, such as identifying and reporting bugs, improving code, or developing new features for a blockchain project.

Collators

Node operators in parachain networks that collect and execute transactions, generate state transition proofs, and provide unsealed blocks to validators for proposing a parachain block, while also facilitating message passing between different parachains.

Contribution Tokens

Tokens issued by projects which successfully raised funds on Polimec, serving as proof of participation for participants of the respective funding round.

Credentials

Verifiable, tamper-proof records that attest identity attributes, skills, achievements, and qualifications of individuals.

Cross-Chain Transfers

Process of transferring tokens or value between different blockchains.

Cross-Consensus Message Format (XCM)

Format that enables the exchange of any type of data between blockchains.

CTYPE

Claim types define the structure of a credential.

DIDs

Decentralized identifiers, globally unique persistent identifiers that do not require a centralized registration authority and are often generated and/or registered cryptographically.

DOT

Native token of Polkadot, serves three purposes: bonding, general operation, and governance.

Evaluators

Assess projects that apply for funding on Polimec and earn rewards for successful evaluations or get slashed for unsuccessful ones.

EVM

Ethereum Virtual Machine, a decentralized software used to create decentralized applications and smart contracts.

Forks

Creating a new blockchain protocol by copying an existing one and making changes to its software or logic.

Fully Diluted Supply

Total number of tokens issued by a project, including the supply which is still to be issued or released.

Gavin Wood

Polkadot founder and Ethereum co-founder, well known for his contributions to smart contract technology and blockchain interoperability.

HNWI

High net worth individuals, commonly referred to as HNWIs, are individuals with substantial financial resources and investable assets.

Instance-ID

Unique identifier assigned to each instance on a blockchain network.

Institutional Participants

Legal entities which qualify as professional, such as financial intermediaries or companies with professional treasury departments.

Interoperability

Ability for a system, such as different blockchains, to exchange or to make use of information and data.

Issuers

Projects applying for funding or raising funds using Polimec.

KILT Protocol

A blockchain identity protocol for generating self-sovereign, decentralized identifiers (DIDs) and verifiable credentials.

KYC/AML

Know Your Customer, process of identifying and verifying the client's identity aimed at uncovering or preventing fraud, corruption, money laundering and terrorist financing.

Anti Money Laundering, a framework of laws, regulations, and procedures aimed at uncovering or preventing efforts to disguise illicit funds.

Layer 0

Provide the fundamental infrastructure for layer 1 blockchains and are designed to address the challenges prevalent to blockchain systems, including security, scalability and interoperability.

Layer 1

Base protocol layer of a blockchain network.

Linear Bonding

Gradually locking up tokens in a smart contract over a specified time period.

Liquidity Pool

Pool of tokens locked in a smart contract that facilitates the trading between the tokens on a decentralized exchange.

Liquidity Providers

Earn fees by offering cryptocurrency assets as liquidity in a decentralized trading pair, which are locked with the protocol for a set period of time.

Mainnet

A project’s fully operational blockchain.

Mainnet Tokens

Tokens that operate on a project’s fully operational blockchain (mainnet).

Minimum Price

Minimum price per token set by the issuer during the funding application.

Multichain

System where multiple independent blockchains are linked together to enable cross-chain interoperability and communication between them.

Multipliers

Factor applied by participants in a funding round to determine the participation amount in relation to the required bonded PLMC and respective duration of the vesting period of their PLMC and mainnet tokens.

Network Participants

General term for all network participants interacting on Polimec, i.e. issuers, evaluators, participants, stakers, liquidity providers.

Nodes

Computers or devices that contribute to maintaining the blockchain by validating transactions, storing a copy of the blockchain, and relaying information to other nodes.

Nominated Proof-of-Stake

Proof-of-stake consensus mechanism where nominators (token holders) nominate and back validators with their own stake to secure the network and create new blocks in exchange for rewards.

On-Chain

Activities, transactions, or data that are recorded directly on the blockchain.

On-Chain Treasury

Smart contract that holds a cryptocurrency project's funds and manages the allocation of those funds through community governance.

Parachains

Purpose-built blockchains that connect to the Polkadot Relay Chain to benefit from shared security, cross-chain interoperability and scalability.

Parathread

Allow parachains to temporarily participate (on a block-by-block basis) in Polkadot security without needing to lease a dedicated parachain slot.

Participation Currencies

Cryptocurrencies that are accepted by the issuer for participating in the funding round (e.g. USDT, USDC, DOT, ETH), specified in the issuer’s funding application.

Participants

Participate in funding rounds on Polimec and are categorized as retail, professional, or institutional participants.

Permissionless System

Blockchain that allows anyone to participate and transact without the need for approval or permission from a centralized authority/actor.

PLMC

Native token for Polimec, serves four purposes: evaluation, participation, staking, and governance.

Polkadot

Heterogeneous, multi-chain network allowing various blockchains of different characteristics to perform arbitrary, cross-chain communication under shared security, enabling cross-chain interoperability and scalability.

Professional Participants

Natural persons with the necessary knowledge or experience and/or sizable assets at their disposal.

Proof-of-Validity (PoV)

Piece of information created by collators that parachain validators use to verify the validity of a new parachain block, without the need to store the entire parachain storage.

Proof-of-Work (PoW)

Consensus mechanism in which nodes solve complex mathematical problems to validate transactions and mine new blocks, requiring significant computational power and energy consumption.

Protocol Inflation

Gradual increase in the supply of a cryptocurrency resulting from the issuance of new tokens according to the protocol's tokenomics, often used to incentivize network maintenance.

Pseudonymous

Practice of using a public key or wallet address where the identity of a person is unknown whereas it is still possible to assign related transactions to the same wallet.

Regulatory Compliance

Adherence to the laws, regulations, and other provisions set forth by governmental authorities or other bodies that apply to a specific activity or process.

Relay Chain

Blockchain that coordinates consensus and communication between parachains and external chains.

Retail Participants

Natural persons that do not qualify as professional participants.

Root Origin

Concept of root account that has ultimate control over a network's parameters that can make systemic changes. On Polimec, the root origin is the highest privileged origin, and its only used for enacting governance proposals.

Rule-Based Framework

Set of predetermined rules that governs the execution of transactions based on the behavior of network participants or specific circumstances on a blockchain.

Runtime Upgrades

Allow changes or improvements made to the underlying software or logic of a blockchain while it is still operational (i.e. without the need for a hard fork).

SDK

Software Development Kit is a set of software building-tools for specific applications such as protocols.

Slashing

Penalty mechanism in blockchains that involves the deduction of a portion of staked tokens for certain types of malicious, erroneous behavior, or i.e. inaccurate funding prediction.

Smart Contract

Self-executing digital program that automatically enforces the terms and conditions implemented in its code, such as a transaction between parties on the blockchain.

Solidity

High-level programming language used for writing smart contracts on the Ethereum blockchain.

Stablecoin

Type of cryptocurrency designed to maintain a stable value, often pegged to a fiat currency or commodity, providing price stability.

Stakers

Delegate to collators who validate transactions and stabilize the network, and in return, earn rewards.

Staking

Holding/locking up tokens to contribute to validating transactions and supporting the functioning of the network, and in return, earning rewards.

State Transition Proof

Mathematical proof that demonstrates the validity of a transition between two states on a blockchain network, ensuring the integrity and correctness of transactions.

Sybil Attack Protection

Strategies and mechanisms designed to safeguard decentralized and distributed systems from security threats posed by malicious users creating multiple fake identities or nodes to manipulate or control the network.

Tokenomics

Parameters that govern the issuance, allocation, distribution, and usage of tokens, considering factors such as supply and demand, market adoption, and network effects.

Trustless

Ability of a system to function without the need for network participants to trust each other or a central authority/actor.

Unbonding

Withdrawing tokens from a staking pool or other activities, which takes a certain amount of time to complete.

Validators

Node operators in a proof-of-stake (PoS) blockchain that validate transactions and proofs from collators on parachains, and create new blocks along with other validators to earn rewards.

Vesting

Gradual release of tokens over a specified period of time, often used as a mechanism to incentivize long-term commitment from token holders.

Web3

Third generation of the world wide web, characterized by the use of decentralized technologies such as blockchain, smart contracts, and peer-to-peer networks.

User Guides

Get Started

Start investing in early-stage deals with just a wallet in less than 10 minutes. 

On Polimec, anyone can access private deals directly from their device - verified, funded, and ready to go.

Get Wallet

Choose a wallet that fits your setup - EVM or Substrate, mobile or desktop.

You will use this wallet to connect, verify, and invest directly on Polimec.

Wallet

Mobile

Desktop

EVM

Substrate

Guide

Verify

To join a fundraising round, complete a quick ID check via Sumsub - it is fast and keeps things compliant. How to Start

Go to
Connect your wallet (top right)
Tap SIGN IN to launch Sumsub

You Will Need

Valid ID or driver’s license
Proof of residence (e.g. utility bill or bank statement)
A camera for a face scan

Have your docs ready - it takes just a few minutes.

Fund

Fund your account with USDT, USDC, DOT, or ETH. Your assets stay non-custodial and under your control. Use the deposit page to move your funds to Polimec:

Prefer FIAT? You can also fund your account using a credit card via Banxa.

PLMC

Unlock full access to Polimec.

Find PLMC on leading exchanges and start participating in the future of decentralized fundraising:

Zero Participation Fees PLMC holders invest with no protocol fee. Non-holders pay a 1.5% participation fee on each investment via the One Token Model, which benefits PLMC holders. Bonus Allocations Active PLMC evaluators receive bonus tokens - meaning better entry terms and deeper exposure to high-conviction projects. Staking Rewards Stake PLMC to earn yield while supporting protocol operations. Buybacks via On-Chain Treasury A share of every raise (6–10%) is paid by projects and flows into a transparent, multi-asset treasury. Treasury activity supports token buybacks - reinforcing long-term value for PLMC holders.