Interpreting BIO Protocol: Binance Labs' First Involvement in DeSci Investment, Building a Meaningful Research Funding Incubator

Author: Shenchao TechFlow

Beyond the meme craze, the crypto industry is still making substantial project investments, and the investment trends of Binance Labs are also attracting attention.

Yesterday, Binance Labs announced its investment in the decentralized science (DeSci) related protocol BIO Protocol, marking Binance Labs' first investment in the DeSci sector, and BIO Protocol has become the focus of attention.

However, the situation seems to have been predictable.

Although CZ has gradually stepped back from Binance, he mentioned in a letter to a judge during legal issues in the first half of the year:

"I feel that there is too much medical research driven by interests… I want to help fund small research labs. Over the past few years, I have spoken with many biotechnology startups in this field."

The focus on the medical and scientific fields reflects the thoughts of key figures from Binance, which to some extent influences the investment department's perspective and decision-making inertia.

So, what exactly is BIO Protocol, and what unique aspects does it possess to attract Binance Labs' investment?

Incubator for Decentralized Science

In fact, in the document announcing Binance Labs' investment in BIO, the essence of BIO has already been identified as "the Y Combinator of on-chain science."

Y Combinator is a well-known tech startup incubator that provides funding, guidance, and resources to early-stage startups, helping them grow and develop rapidly.

The so-called on-chain science version refers to the scientific research and funding processes conducted using blockchain technology. "On-chain" means that these activities and transactions occur on the blockchain, characterized by transparency and decentralization.

If we compare it to Y Combinator, a rough functional point of BIO Protocol could be:

• Incubation Function: Similar to how Y Combinator incubates tech startups, BIO Protocol provides support and resources for scientific research projects.

• Funding Support: Through blockchain technology, BIO can more easily raise funds for research projects.

• Community Participation: Allows scientists, patients, and investors from around the world to participate in and support research projects.

• Accelerated Development: Helps research projects grow quickly, similar to how Y Combinator accelerates the development of startups.

• Innovative Models: Introduces new research funding and commercialization models, breaking the limitations of traditional research funding.

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

From the perspective of more common crypto projects, the essence of BIO Protocol is a curation and liquidity protocol in the decentralized science (DeSci) field. Its design concept stems from the team's previous successful experiences with Molecule (a tokenization platform for early biomedical projects) and VitaDAO (the largest decentralized community for longevity science).

BIO Protocol mainly includes the following core components:

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

BioDAO members pool resources (data, capital, labor) together, leveraging the collective power of globally distributed stakeholders (such as patients, scientists, and biotech builders) to accelerate R&D processes and develop new intellectual property.

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

Currently, BIO has also announced some successful DAO cases, some of which have connected with real-world universities, research institutions, and pharmaceutical companies, successfully demonstrating the effectiveness of this model:

1. Curation System

Utilizes a token staking mechanism, combining community voting and professional evaluation to filter and support high-quality biotech projects.

Specifically, BIO token holders can manage which bioDAOs are accepted into the BIO network by staking their BIO tokens on the bioDAOs they wish to support here .

BioDAOs that vote to enter the network receive funding through the BIO Launchpad , as well as liquidity support from the community, incentives, and other acceleration services.

1. Liquidity and IP Tokenization

Provides tokenization solutions for biotech IP, allowing these IPs to be tokenized (in forms such as NFTs and FTs); simultaneously establishes a secondary market trading mechanism to achieve liquidity for research project investments.

Among them, 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 acquires ownership of IP tokens. Each BioDAO typically holds a portfolio of IP tokens representing intellectual property related to specific scientific research fields of the BioDAO. 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 IP generated by the research, which includes patents for new compounds, proprietary screening systems, and possibly even treatment methods.

However, unlike other NFT revenue-sharing models, IP Tokens do not grant holders guaranteed financial returns or revenue-sharing rights from the commercialization of these assets, but rather benefits in real-world research, such as:

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

1. Incentive Mechanism (Bio/Acc Rewards)

Designs special acceleration reward mechanisms to incentivize early participants and contributors to promote the rapid development of the ecosystem.

Bio/Acc Rewards provide rewards in the form of BIO tokens to bioDAOs for achieving key milestones. In simple terms, this incentivizes both B2B and B2C sides as long as they complete the following events:

For institutions and research organizations: Conducting initial token auctions through the BIO Launchpad, funding science (IP-Token releases), generating substantial revenue from product launches, and conducting decentralized clinical trials.

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

Token Economics and Auction Analysis

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

Contract address:

0xcb1592591996765Ec0eFc1f92599A19767ee5ffA

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

• Choosing and supporting bioDAOs to join the BIO network

• Deciding the terms for participating in bioDAOs and their IP token sales

• Providing support and discounts for bioDAO's health products/services

• Governing within member bioDAOs

• Deciding on the issuance of BIO tokens, treasury allocation, and protocol upgrades

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

In terms of 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)

• Maximum supply: No limit, future increases may be decided through governance votes

• Increase mechanism: Requires deploying a new token contract to replace the current BIO token

In terms of token distribution, the 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 are as follows:

• 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 unlocking schedule:

• Community airdrop:

• Public airdrop portion: No lock-up

• bioDAO and founding members: 1-year cliff followed by 6 years of linear unlocking

• Community auction: 50% immediately available, 50% linear unlocking over 1 year

• Ecosystem incentives: No lock-up

• Core contributors: 1-year lock-up, followed by 6 years of linear unlocking

• Molecule ecosystem fund: 4 years of linear unlocking

• Molecule: 4 years of linear unlocking

• Investors: 1-year lock-up followed by 4 years of linear unlocking

• Advisors: 1-year lock-up followed by 6 years of linear unlocking

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

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

The first round used an English auction mechanism, where participants bid using ETH. The main purpose of this round was to establish an 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, distributing a total of 12.75% of the token supply; as of the latest news, the second round auction is ongoing, with most auctions completed and only a few still in progress.

Interested investors can participate in the auction through BIO's official platform . Participants need to connect their wallets and then choose to participate in either the bioDAO asset pool or the ETH pool auction based on their interests. (Note: This is just a link and information organization, not investment advice; please DYOR)

After the auction is completed, participants will receive BIO tokens, with 50% immediately available and the other 50% linearly unlocking over one year. This mechanism aims to balance immediate liquidity and 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. Here are the main features of the airdrop plan:

The BIO airdrop plan allocates 6% of the total supply, approximately 199,200,000 BIO tokens. This amount is considerable, reflecting the project's emphasis on community building.

The airdrop mainly 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

• Founding members airdrop: Rewards for early contributors

Different types of airdrops have different lock-up periods; the public airdrop portion has no lock-up period, allowing users to use it immediately. The airdrops for bioDAOs and founding members 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 demonstrate the project's commitment to fair distribution, community participation, and long-term development. Through multiple rounds of auctions and multi-tiered airdrops, BIO is actively building a diverse and highly participatory community, laying a solid foundation for its decentralized biomedical research network.

Not an Isolated Case

In addition to Binance Labs' involvement in the DeSci sector through this project, other VCs are also on the lookout.

Previously, we mentioned in “Interpreting AminoChain: a16z's First Involvement in DeSci Leading a $5 Million Investment, Patients Contributing Biological Samples for Profit” that about 40 days ago, a16z also entered this sector for the first time to invest in projects.

In a market rhythm where VC coins do not take over from each other and memes are rampant, if crypto can do something good for traditional industries, and if VCs can genuinely invest in projects that benefit other industries, it can be seen as a refreshing and correct stream.

As the founder of the BIO Protocol, Paul Kohlhaas, said, "Science drives human progress, but we have trapped the smartest minds in an endless maze of funding—they spend 80% of their time writing grants instead of solving the biggest challenges facing humanity."

Less hype and more meaningful technological projects to unlock breakthrough progress are certainly worth the attention of leading investors in the industry, but the effectiveness of investments and the ultimate returns will inevitably require time and the market to test.