Complaints of bank account closures are periodically raised in this space with some going as far as accusing banks of engaging in anti-competitive practices, a topic raised at the European Parliament workshop a few days ago.
Can the solution be the launch of a new bank friendly to this space? We might soon find out because Polybius wants to raise funds through an ethereum token to create “a regulated bank for the digital generation,” according to their one-line pitch on the website.
Reading through the prospectus, the impression given is of a serious endeavor. We are not banking lawyers so might be fooled, but they thoroughly detail the necessary steps they aim to take to comply with what appears to be a mountain of licenses, regulations, compliances and all the rest.
Yesterday, they announced in a press release that “EY (Ernst & Young) Partner Daniel Haudenshild, financial services managers Valdemar Scherer and Sven Möller are collaborating to lead the Polybius project team on banking operations, technology, and legislation.”
The exact nature of this collaboration is not very clear. They may simply be hired for a fee in a just doing their job sort of manner, but, according to the press release:
“The Polybius Cryptobank project attracted the attention of Swiss financiers at the BlockchainUA conference held in Kiev in March. Experts from EY were interested in the idea of re-inventing the bank by using a combination of traditional banking services for all segments of the population, business types and latest technology solutions like blockchain and artificial intelligence to reduce costs, increase efficiency and profitability.”
So it might be slightly more. Besides the three EY advisors, the rest appear to be blockchain geeks, but it’s a bit confusing who exactly is doing what because in the team page everyone seems to be from other companies and no one from Polybius.
The two pictured above from Polybius own twitter seem to be Sergei Potapenko on the right which their website describes as Founder, Business Development CEO, HashCoins OÜ and Vitali Pavlov on the left, described as Production Management, Chief Product Officer, HashCoins OÜ.
That suggests this is a sort of Hashcoins’ product, a mining and blockchain company, although they may have created a new specific legal structure as their prospectus says the project is run by the Polybius Foundation, incorporated in Estonia this year.
Interestingly, listed as team member are Andrei Veressov, a lawyer at Bright Law Firm and three individuals from Ambisafe, a blockchain start-up specializing in ethereum which will handle the smart contract set-up and token sale process at the code level.
So, they appear to be listing individuals from different companies, but no one from Polybius, leaving us a bit confused regarding who exactly is in charge. Vital information which would be necessary before any token sale.
Another flag may be they sort of seem to be all over the place regarding the blockchain aspect. They say, for example, they are to use the Emer blockchain for CryptoID, but have plans to incorporate DAO like structures, presumably based on ethereum’s blockchain, for a financial marketplace.
Overall, they appear to have strengths and weaknesses, but the general idea of actually setting up a bank to deal with what some call anti-competitive banking practices sounds like a very good one if it can be pulled off.
For that, they want to raise “at least $10 million” through an ICO which creates their own token that attracts 20% of the bank’s profits once it’s all running. Making it very much a share, raising questions regarding its legality especially considering the extremely regulated environment they are to enter. A question they do not address as far as we can see.
However, maybe they’ll be able to pull it off. As stated earlier, the regulatory aspect appears to be very thorough – although we have no expertise on that – and the blockchain aspect can really be considered as just a bonus if they manage to provide “financial services for cryptostartups and the cryptocommunity,” as they state they aim.
A service which appears to be very much in need and, if not provided by this project, probably will be provided by another one if regulators approve and if banks continue making it very difficult for blockchain businesses to open a bank account.