How Molecule is accelerating medical research through tokenised IP and decentralised biotech funding

Academic research is challenging. Obtaining grants and financial support for research projects is highly competitive and time-consuming. Researchers typically juggle multiple projects, including teaching, and they also have to deal with realities like data management and ethics. 

But now, a movement called  Decentralised Science (DeSci) aims to transform traditional scientific research by connecting patients, scientists, investors, biotech DAOs, and novel crowdfunding methods. It democratises access to research funding through greater transparency, open access, and collaborative efforts, thus accelerating scientific breakthroughs. 

DeSci leverages blockchain-based platforms, tools, NFTs, tokens, decentralised autonomous organisations (DAOs),  and Web3 principles to facilitate funding for scientific research. 

From online communities to open source bioscience

I spoke to a pioneer of the DeSci movement, Paul Kohlhaas, founder and Chief Architect at  Molecule, a platform dedicated to accelerating scientific research and bringing intellectual property onchain through community-driven initiatives. It's like crowdfunding on steroids, where instead of getting an item in exchange for your funding, you get a cut of the intellectual property (IP). 

Kohlhaas spent his youth engaging with online biohacking forums and patient communities on platforms like Reddit, where online communities focused on tackling medical challenges—like diabetic patients collaborating to develop their own insulin due to its prohibitive cost in the US. From HIV communities exploring gene therapies to cancer patient groups sharing experimental treatments, nootropics and longevity, there was a community for virtually everything.

He recalls:

"What struck me was the collaborative and open spirit of these groups. Many participants were there out of necessity — driven by a healthcare system that had failed them. These weren't just amateur discussions either; the communities included hobby scientists, doctors, and academics."

Later, while studying economics at the University of St Gallen in Switzerland, he considered these dynamics through a systems design lens. Around the same time, the US opioid crisis was becoming more visible, alongside issues like over-prescription of medications such as Adderall, antidepressants, and benzodiazepines. 

He  began questioning the underlying incentives within the pharmaceutical system:

"Why, on one hand, were there open communities striving to solve critical issues themselves, while, on the other, parts of the system seemed to be exacerbating problems through overprescription?"

Seeing fundamental flaws in healthcare access and treatment brought to mind how the banking crisis gave rise to Bitcoin as an alternative to centralised financial systems.

Combined with a deep dive into Bitcoin in 2014, he started to think about the potential to build infrastructure that could align with the openness, collaboration, and inclusivity I saw in those biohacking communities.

Following work in the blockchain tech space that included a business role at ConsenSys and the founding of Web 3 design studio Linum Labs, Molecule was born.

Empowering researchers to focus on science, not fundraising

According to Kohlhaas, "most of the researchers we speak to spend 80 per cent of their time fundraising and 20 per cent doing the science. 

"Our vision has always been creating an open IP ecosystem where researchers can ledger their IP onchain and quickly find a funder."

Kohlhaas asserts that many researchers don't want to launch startups—they want to stay at their universities and focus on research. Even those who do launch startups often struggle as founders, because their expertise lies in science, not business.

"In the traditional model, biotech VCs often take up to 60–70 per cent equity ownership in a spin-out. In contrast, the DAOs we create take a similar level of ownership, but that ownership resides within a collective actively advancing the science.

This allows researchers to stay at their universities, focus on their work, and avoid the burdens of managing a startup."

Molecule facilitates a platform for DAOs to connect with researchers, many of whom are focused on a specific therapeutic area. DAOs form with hundreds, thousands of people online, and they begin operating like decentralised mini community-led R&D-focused pharma companies. 

Molecule serves as a foundational platform that tokenises the IP. Each DAO connects with researchers globally, onboarding them and forming scientific advisory boards. Researchers are incentivised to bring projects from their own networks into the organisation. 

"Once a suitable project is identified and the organisation is ready to fund it, we begin negotiations with the University or research institution and the researcher to establish a technology transfer agreement.

Essentially, this involves out-licensing a piece of intellectual property in exchange for a specific funding amount."

The collective participatory power of the DAO

DAO members gain intellectual property tokens (IPTs) which offer stakeholders a unique opportunity to participate directly in the research's development, decision-making, and future directions. 

This includes a stake in the IP generated from the research, such as patents on novel compounds, proprietary screening systems, and potentially even therapeutic methods. However, it's important to note that IPTs do not entitle holders to guaranteed financial returns or revenue sharing from commercialising these assets. 

The DAOs then take on the commercialisation role, assembling portfolios of projects and hiring biotech experts to drive the development of compounds forward. DAO members receive project updates on a regular basis where they can ask the researchers questions directly. 

Examples of research funding by DAOs include longevity biotech projects at the University of Rochester (supported by VitaDAO), Antibodies for Alzheimer's Disease (Tel Aviv University), gene therapies that could help address aging-related genetic factors funded by ARTAN Bio, and neurodegeneration funded by Cerebrum DAO.

There are also DAOs that focus on specific conditions such as Long COVID, and for hair loss prevention and treatment,  HairDAO.

A financial layer for DeSci

While  Molecule is focused on the IP side of things, Kohlhaas has also founded Bio Protocol which acts as a financial layer for DeSci,  enabling the creation and support of BioDAOs themselves.  It has facilitated the launch and funding of 8 BioDAOs, collectively raising $30.3 million for research, with $7.2 million already deployed into various scientific projects. 

Notably, in November 2024, Binance Labs made its first DeSci investment in the BIO Protocol.

DIY citizen science

Molecule also launched pump.science — why do sites associated with blockchain so often look like this? — a platform where users submit longevity regimen ideas to be tested on the Wormbot, own the resulting intellectual property, and stream experiment results in real-time. It's more citizen science than academic rigour, with research testing on worms, flies and mice: 

• Worms (C elegans) at Ora Biomedical on the Wormbot

• Flies at Tracked Biotechnologies in the FlyBox

• Mice at Tracked Biotechnologies via MouseWatcher

The credibility challenge of blockchain tech

Researching this article, I am always of course, conscious of the appalling reputation that most crypto and blockchain efforts have amongst the general public. 

While crypto is the conduit for financing DeSci, its foundations are legitimate. It uses IP lawyers and deploys legal agreements akin to those in pharma and biotech companies.

However, the pump.science platform had its crypto wallet hijacked and used to create fraudulent tokens after its private key was left public in the codebase. While it highlights the inherent vulnerabilities with crypto, an error like this could, arguably, have occurred in any financial institution. 

Kohlhaas admits, "Like any financial system, it has its pros and cons. However, crypto offers something unique: a permissionless structure.

"For us, the focus isn't on crypto for crypto's sake or exposing researchers to the volatility of crypto markets. It's about funding and community connection.

Our system ensures researchers receive their funds directly into their bank accounts or the university's account. We primarily use stablecoins for transactions, providing stability and reliability."

It's worth noting that crowdfunding is nothing new. And DAOs exist across a myriad of verticals, including gaming, sports like football and sailing, so why not crowdfund research and have a say in its direction?

Looking to the future, Molecule is determined to usher in the next era of DeSci. Last year, it partnered with Nucleate, a student-led nonprofit organisation dedicated to empowering the next generation of biotech leaders and helping to educate and train venture fellows in sourcing DeSci projects.

For individuals with rare or complex health conditions eschewed by traditional pharma due to limited profitability, DeSci offers a groundbreaking alternative. By radically changing how scientific research is funded, conducted, and shared, DeSci unlocks new opportunities for collaboration and innovation within the scientific community. This drives open, inclusive research with the opportunity to deliver better outcomes for patients and society as a whole.

Lead image: Freepik.