Forward the original title: Decoding BIO Protocol: Binance Labs’ First Foray into DeSci Investment, Building a Meaningful Research Funding Incubator

BIO Protocol is essentially a curation and liquidity protocol in the decentralized science (DeSci) space.

Beyond the Meme frenzy, the crypto industry continues to focus on substantive project investments, with Binance Labs’ investment moves drawing significant attention.

Yesterday, Binance Labs announced its investment in BIO Protocol, a decentralized science (DeSci) project. This marks Binance Labs’ first foray into the DeSci sector, bringing BIO Protocol into the spotlight.

However, this development seems to have been foreshadowed.

Although CZ has gradually stepped back from Binance, earlier this year, while addressing legal issues, he mentioned in a letter to the court:

“I believe current medical research is overly driven by profit… I want to help fund small research labs. Over the past few years, I have spoken with many biotech startups in this field.”

The focus on medicine and science reflects the mindset of a key former figure at Binance, which, to some extent, has influenced the investment team’s perspectives and decision-making tendencies.

So, what exactly is BIO Protocol, and what sets it apart enough to attract investment from Binance Labs?

A Decentralized Science Incubator

In fact, Binance Labs explicitly described the essence of BIO in its investment announcement as the “on-chain science version of Y Combinator.”

Y Combinator is a renowned tech startup incubator that provides early-stage companies with funding, mentorship, and resources to help them grow and scale rapidly.

The “on-chain science version” refers to leveraging blockchain technology for scientific research and funding processes. “On-chain” signifies that these activities and transactions occur on the blockchain, offering transparency and decentralization.

If we compare BIO Protocol to Y Combinator, its functions can be roughly outlined as follows:

• Incubation: Similar to how Y Combinator supports tech startups, BIO Protocol provides support and resources for scientific research projects.
• Funding: Utilizing blockchain technology, BIO makes it easier to raise funds for research projects.
• Community involvement: Enables global scientists, patients, and investors to collectively participate in and support research projects.
• Acceleration: Helps research projects grow quickly, much like how Y Combinator accelerates the development of startups.
• Innovative models: Introduces new funding and commercialization methods for research, breaking the limitations of traditional funding systems.

How are these features realized? This involves the core design of BIO Protocol.

From a common crypto project perspective, BIO Protocol is essentially a curation and liquidity protocol in the decentralized science (DeSci) space. Its design draws inspiration from the team’s prior successes with Molecule, a platform for tokenizing early-stage biomedical projects, and VitaDAO, the largest decentralized community for longevity science.

BIO Protocol’s main components include:

1. BioDAO: Sub-DAOs focused on specific scientific or medical research areas.

BioDAO members pool resources such as data, capital, and labor, leveraging the collective power of globally distributed stakeholders, including patients, scientists, and biotech innovators, to accelerate R&D and create new intellectual property.

BioDAO raises funds through token sales and uses those funds to support and develop biotech projects aligned with its mission, creating shared ownership of intellectual property among its members.

Currently, BIO’s official team has also shared some successful DAO case studies. Some of these DAOs have collaborated with real-world universities, research institutions, and pharmaceutical companies, effectively demonstrating the viability of this model.

1. Curation System

The curation system uses a token staking mechanism, combining community voting with expert evaluation to filter and support high-quality biotech projects.

Specifically, BIO token holders can stake their BIO tokens on the bioDAOs they wish to accept into the BIO network, managing which bioDAOs are included.

BioDAOs that are voted into the network receive funding through the BIO Launchpad, along with token liquidity support, incentives, and other acceleration services from the community.

1. Liquidity and IP Tokenization

BIO Protocol provides a tokenization solution for biotech intellectual property (IP), allowing these IPs to be tokenized in forms like NFTs and FTs. It also establishes a secondary market trading mechanism to enable liquidity for research project investments.

The intellectual property tokens (“IP-Tokens” or “IPT”) represent partial governance rights over the generated intellectual property (IP). These tokens give holders the opportunity to directly participate in the development, decision-making, and future direction of the research.

BioDAO develops and owns the rights to IP tokens. Each BioDAO typically holds a portfolio of IP tokens that represent intellectual property related to a specific scientific research field. For example, VitaDAO develops and owns shares of IPT VitaRNA and VITA-FAST.

When someone acquires an IP token, they gain a share of the intellectual property generated from the research, which can include patents for new compounds, proprietary screening systems, and potentially even treatments.

However, unlike other NFT revenue-sharing models, IP tokens do not grant holders the right to guaranteed financial returns or revenue shares from the commercialization of these assets. Instead, they provide benefits in the realm of real-world research, such as:

Access to exclusive information, receiving the latest updates and detailed reports on intellectual property research and development progress, and gaining early or preferential access to innovations, collaborations, or future opportunities related to the intellectual property.

1. Incentive Mechanism (Bio/Acc Rewards)

A special acceleration reward mechanism is designed to incentivize early participants and contributors to promote the rapid development of the ecosystem.

Bio/Acc Rewards are provided to bioDAOs in the form of BIO tokens to achieve key milestones. In simpler terms, it motivates both B2B and B2C participants as long as they complete the following events:

For institutions and research organizations: Initial token auctions through BIO Launchpad, funding science (IP-token releases), generating significant revenue from product launches, and conducting decentralized clinical trials, etc.

For general users: Contributing to clinical trials or self-reported health data, using bioDAO products (such as certain medical supplies), and purchasing bioDAO products online or in physical stores.

Tokenomics and Auction Analysis

The native token of the BIO Protocol is $BIO, deployed on the Ethereum blockchain.

Contract address:

0xcb1592591996765Ec0eFc1f92599A19767ee5ffA

1. Holders of BIO tokens can participate in key protocol decisions, including:

• Choosing and supporting bioDAOs to join the BIO network
• Deciding the terms of participation in bioDAOs and their IP token sales
• Supporting and offering discounts on bioDAO health products/services
• Governing within member bioDAOs
• Deciding on the issuance of BIO tokens, treasury allocation, and protocol upgrades

As the bioDAOs and IP assets within the BIO network grow, BIO token holders may benefit. The BIO treasury accumulates value through various mechanisms, including token distributions from incubated bioDAOs and liquidity owned by the protocol (POL).

Regarding token supply, the total initial supply is 3,320,000,000 BIO, with the following characteristics:

• Current status: Non-transferable (currently not tradable on secondary markets)
• Max supply: No cap, with potential future increases decided through governance votes
• Minting mechanism: A new token contract must be deployed to replace the current BIO token

Token distribution is as follows, Community (total 56%):

• Community airdrop (6%): 199,200,000 BIO
• Community auction (20%): 664,000,000 BIO
• Ecosystem incentives (25%): 830,000,000 BIO
• Molecule ecosystem fund (5%): 166,000,000 BIO

Other distributions:

• Core contributors (21.2%): 703,840,000 BIO
• Investors (13.6%): 451,520,000 BIO
• Molecule (5%): 166,000,000 BIO
• Advisors (4.2%): 139,440,000 BIO

Each category has its specific unlock schedule:

• Community airdrop:
  • Public airdrop portion: No lock-up
  • bioDAO and Genesis members: 1-year cliff, then 6 years linear unlock
• Community auction: 50% immediately available, 50% 1-year linear unlock
• Ecosystem incentives: No lock-up
• Core contributors: 1-year lock-up, then 6 years linear unlock
• Molecule ecosystem fund: 4 years linear unlock
• Molecule: 4 years linear unlock
• Investors: 1-year lock-up, then 4 years linear unlock
• Advisors: 1-year lock-up, then 6 years linear unlock

At the same time, BIO Protocol employs a dual-round Genesis auction mechanism for its token launch.

Genesis is the launch plan for the BIO Protocol, aimed at distributing the initial tokens through an auction process and raising funds for the protocol. This plan is divided into two rounds, each with specific objectives and mechanisms.

The first round used an English auction mechanism, where participants bid with ETH. The main purpose of this round was to build the initial community, discover the market price of BIO tokens, and raise initial funds for the protocol.

The first round has been successfully completed, and BIO is currently in the second round of the Genesis plan. This round uses a Dutch auction mechanism and will allocate 12.75% of the token supply. As of the latest update, the second round auction is ongoing, with most of the auction already completed, and only a few remaining.

Interested investors can participate in the auction through BIO’s official platform. Participants need to connect their wallets and then choose to bid on either the bioDAO asset pool or the ETH pool based on their interests. (Note: This is for informational purposes only and does not constitute investment advice; please DYOR)

After the auction, participants will receive BIO tokens, with 50% immediately available and the remaining 50% unlocking linearly over one year. This mechanism aims to balance immediate liquidity with long-term holding incentives.

In addition to the Genesis auction, BIO has also designed a comprehensive airdrop plan aimed at rewarding early supporters and expanding the community. The main features of the airdrop plan are as follows:

The BIO airdrop plan allocates 6% of the total supply, approximately 199,200,000 BIO tokens. This significant allocation demonstrates the project’s commitment to community building.

The airdrop primarily targets three groups:

• Public airdrop: Aimed at early users of the Molecule platform, members of life sciences-related DAOs, etc.
• bioDAO airdrop: Specifically for bioDAOs that have joined the BIO network.
• Genesis member airdrop: Rewarding early contributors.

Different types of airdrops have varying lock-up periods: the public airdrop portion has no lock-up period, allowing immediate use, while bioDAO and Genesis member airdrops have longer lock-up periods, including a 1-year lock-up and 6 years of linear unlocking.

Overall, BIO’s Genesis launch plan and airdrop strategy reflect the project’s focus on fair distribution, community participation, and long-term development. Through multiple rounds of auctions and multi-tiered airdrops, BIO is actively building a diversified, highly engaged community, laying a solid foundation for its decentralized biomedical research network.

Not an Isolated Case

Other venture capital firms are also closely watching the DeSci space, not just Binance Labs. Previously, we mentioned in the article “AminoChain: a16z’s First DeSci Investment, Leading a $5 Million Round, Patients Contributing Biological Samples for Profit” that about 40 days ago, a16z also entered this field to fund projects.

In a market where VC firms avoid taking risks with each other’s tokens and meme projects dominate, if crypto can do something good for traditional industries, and if VCs genuinely invest in projects that benefit other sectors, it can be seen as a refreshing and positive trend.

As Paul Kohlhaas, the founder of BIO Protocol, said, “Science drives human progress, but we have trapped the smartest minds in endless funding mazes—80% of their time is spent writing grants instead of solving humanity’s biggest challenges.”

Less hype and more meaningful technological projects unlocking breakthroughs are certainly worth attention. However, the investment outcomes and eventual returns will undoubtedly need time and the market to test.

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