On DeSci by Paul Kolhaas

Transcript

Cool. Um, hi everyone. Uh, thanks for being here today. Um, some of these empty rooms sometimes at conferences remind me of the early pictures of Andreas Antonopoulos when when he was preaching Bitcoin to like to like a room with like one or two people sitting there. Uh, DI tends to go through these waves of like adoption. So like maybe Walker, you would agree, maybe maybe 4 months ago the room would have been full. But I I I think it also has to do something with um with this being one of the first events of the week. And so uh yeah, super nice to meet all of you. Uh my name is Paul Kohas, um CEO and founder at an organization called Bio and also at Molecule. Uh so why are we here? Uh so

broadly I think we invest into crypto because we believe in sovereignty and in liberty and in open source access and freedom of speech and because something is being taken from us kind of slowly and suddenly over time. So specifically the inflation that we're seeing um in the world today through our governments and fundamentally kind of I believe that science and medicine are really trapped in similar power structures. So biioarma as an industry is kind of like this this uh is too big to change similar as like the Fed or similar as like the banking system and uh taking a US-centric perspective it consumes about 18.5% of US GDP uh which is which is nuts. uh 9% of that actually goes to to drugs and

pharmaceuticals and it's really entrenched by this kind of 19th century era patent system uh which um many people say or believe is is really outdated. So the patent system is actually massive hindrance to innovation. So in our current world today treatments and recurring revenue really dominate healthcare. um the system that we've kind of created needs lifelong customers and it actually disincentivizes cures in many cases. Uh so Goldman Sachs once asked in in a famous um uh uh report that they did is curing patients a sustainable business model and so in this report they analyzed a drug that was just issued by Glacos

Smith Klein uh and because that uh it was a new hepatitis C drug and that hepatitis C drug effectively cured the patients. It was a six-month treatment, relatively cheap, and um but by launching it, they essentially invalidated or like made the rest of their existing drug portfolio irrelevant. And so Goldman Sachs essentially downgraded the company. Uh I think even the the CSO or the CEO at the time was was fired because they developed a cure that worked. Uh and and through doing that essentially killed their own customer base.

um looking moving away from the the patient perspective to the scientist perspective. Scientists today spend 80% of their time applying for funding and 20% doing the science. That's kind of a um a a statistic that we often hear and you have to imagine that imagine this was the case in software development like if as a software developer you had to apply for funding every time you needed something and then and then it would take ages to hear back from the government whether you could build that code and then um yeah so so that's essentially the world that we we we we live in on the scientific side. So our fundamental um hypothesis is that most of the world's scientific talent actually remains

untapped and more broadly that today we live in a time of science friction not of science friction. So, so there's a lot of upward potential actually. Um, in crypto we often look at these um this uh utopian view like if only uh like if only this and that had happened, we would live in this like solar punk future. Well, the reality is we'll only live there if we actually invest into scientific innovation. Um uh this is another cool example. Um this was uh a scientist that treated her own breast cancer with a virus that she grew in the lab. Um so um there's a case report published in the vaccines in

August outlines how um this scientist called self-administered a treatment called enkolytic v viral therapy to help treat her own stage three cancer. And she's been cancer-free now for 4 years. uh and uh she chose to kind of self-experiment on herself um and did this really under the radar and was re really stigmatized for it. Uh and it ultimately there was a report then published in nature but had that report not been published no one would ever have known about this because no one wanted to talk about it. Um, and so if some of you follow intellectus or vtorio, he's he's a really great commentary. He says, "Scientist does science, cures cancer." The science

establishment says, "No, no, no, you can't do that." And then you wonder why scientists are are leaving academia. Um, and so open-source science is actually fraud and frowned upon and like self-experimentation. Uh and so ultimately I think this this is where crypto gets really interesting in like enabling self-s sovereignty around science and enabling permissionless science. So what do we need? We need permissionless science. Um I think to us you're in the next really age of um of kind of scientific innovation. Uh and so we come at this pro we come at this problem from two sides. On the one side, we've developed an exchange for onchain

scientific IP. Uh so IP IP is the kind of the base carrier of science and to bring science on chain and um and essentially make it liquid and open. And then on the other side, we help create scientific communities. Uh so there's many of you have probably heard of bio. And so bio is a curation and liquidity launchpad for scientific communities. And so we bridge DeFi, decentralized finance into decentralized science and essentially enable scientists, patients, um investors to fund research and essentially build onchain portfolios uh of of novel IP in in all sorts of scientific

areas. And we typically call these entities biods. So if you Google like what is a biod you'll find a lot of examples by now uh of um of these types of entities. So biodas create value by essentially building onchain science token or IP token portfolios and then they can directly commercialize them either to their own communities. Um so haird maybe some of you have heard of hairdo if you suffer of hair loss hair is the first global decentralized community dedicated to hair loss. We funded a piece of research with them in in the beginning of 2023. Um, and uh, it was a it was a a repurposed thyroid hormone. The DAO

funded this for about $120,000. The IP was ledgered on chain and now about they then ran a decentralized clinical trial with it. Uh, and at the beginning of this year, they launched their first online store. uh where this thyroid hormone, it's already FDA approved, is now being sold across the United States. Uh and I think I think that's like that's nuts. Like a bunch of people got together online, funded something, and it's four to five times better than the next closest hair loss product on the market. They published a pre-print um with all of the data. Uh and so so this is an example of a community directly commercializing uh um a drug or a therapy that they've developed. In other cases obviously the development life

cycle is much longer and in these cases biodas partner for instance with pharma companies uh so uh vida famously gotten an investment from fizer um and I'll talk about one of their assets in a in a minute um but it's it's very basic so you have tre you have um funds that flow into the treasury of a dowo for the issuance of a token um there's a community that then actively vets and and and funds novel interesting projects and then later on that IP can be uh can be commercialized and brings back funding into the treasury. Uh so this was just in 2023. 2024 it's been more but in 2023 we really after the success of Vita Dow we launched six more of these Dows. Since

then actually we've launched another four or five. There were two that are actually launching at this very moment. One of them is Spine Dow. Um a leading network of spine surgeons worldwide and another one is a Dow called Mico Dow. uh focused on micology and intellectual property around fungal research. Um but yeah, these are some of the leading uh the leading dows that we have in our ecosystem today. Uh and so what is bio really doing? Bio is kind of blending defi and dite together to create a new category which we call sci science finance or sci-fi. Um, one of the biggest bottlenecks that we really see in in in science is how capital is attracted, how it's managed, and how

it's deployed sustainably over the long run. Uh, and that's where we think uh, crypto has an incredibly powerful role to play. Uh, so how does bio work? In bio, token holders curate Dows into into our into a launchpad and they then run through a series of milestones. um we automate their tokconomics and so token holders curate which Dows get accepted into the system and then these Dows can um can leverage a variety of fundraising mechanisms. One could be an auction uh where their token is offered at a kind of a fair launch mechanic. Another one is through a bonding curve uh that works similar for instance to like a virtual protocol. Uh so these are some of the Dows that launched recently. Um, Cutotopia had it had a really successful

raise um in in what did it raise in February this year. Cutopia for instance is focused on rare diseases uh started by an Harvard MD PhD who spent 10 years uh in the rare disease ecosystem. He successfully brought um rare disease therapeutics to stage three clinical trials. So he works with um with families all over the US. rare diseases, you typically have 500 to like a thousand, maybe 2,000 patients um that suffer from a given rare disease. However, he's discovered that the that the that the mechanism like kind of like the how do you operationalize drug development for these individual communities is is very similar.

Um, another DAO that we recently launched is focused on quantum biology um out of leading researcher leading researchers out of MIT and they're building the world's first uh quantum microscope. Uh they're trying to understand processes like um photosynthesis. Um fun fact, it's absolutely crazy. I think it's absolutely crazy. We do not understand how photosynthesis works. Like all the green plants out there, we have solar panels and everything. We we we understand it somewhat mechanistically but really we can't replicate it. It's impossible for us to replicate and and that's and the theory behind it is that photosynthesis among as many things um is based on quantum bi quantum

biological processes. Uh another one that we launched recently is focused on longco. Um yeah cool. So what is bio actually then what does bio represent? Um, bio really represents a growing portfolio of IP tokens that are backed by scientific IP. And so you can go oh slide is a bit outdated. Sorry about that. Um, you can you could go into each individual DAO and each of the individual Dows has a a range of intellectual property tokens that essentially represents its its portfolio. Uh, and we're going to look at and VA's portfolio for instance. So it's it's now funded research for over three years.

Um this was status as of um what was this mid November. So mid November roughly V's IP portfolio is valued at 18 million but V's only raised 10 million in total and so these Dows are actually um actually productive like they're gen they're consistently generating um growth for their IP portfolios. Um and the interesting thing is so bio essentially gives you now governance over each of the individual Dows that are in this network and each of the individual Dows govern a portfolio of IP. Ultimately IP is really valuable for um for pharma companies for industry to yeah to develop something.

Um this is what innovation and drug development typically looks like today. So this is like a typical innovation cycle within the within an organization. And the reason why I'm bringing this up is this process today in kind of in biotech and pharma to get a drug approved um takes up to 10 years and it costs up to $3 billion. And now we can ask what is the reason like why is this so slow? One huge reason uh and I'd actually love to chat more with um uh someone from cancer because I often use cancer as an example is cancer is something that affects affects humans globally right yet we

have so many companies that is spending billions of dollars doing research in complete silos like trying to kind of dig for gold mines of IP rather than operating together kind of in a globally shared uh open scientific landscape. Like if you think about fundamentally if you think about science like scientific innovation scientific data should be openly shared to advance it as fast as possible like software yet it's not we live in a completely siloed ecosystem and that's what massively drives up uh drives up development cost um yeah and so the thinking is so these are these are typically innovation cycles within one organization and the idea of these biodas is what if we open them up

globally Um, one core mechanism that we've developed that actually achieves that. Like, so how can we take all of these little tiny ideas and put them on chain so that more people can work on them is fundamentally is an IPNFT. Uh, and you may have heard about this. So, an IPF is pretty simple actually. It's it's a legal contract like a real world legal agreement that essentially turns it into a real world asset. Um typically for instance between a university and a sponsor like could be between a university uh and a DAO the legal entity that represents the DAO could be between um an group of investors that want to fund a specific piece of research. Uh then it's a smart contract that controls the token. It's metadata JSON that contains the

um that essentially contains the publicly readable uh discoverable part of the IP and then it's all of the encrypted um all of the encrypted data uh the secret sauce that you don't that you don't want people to see. And so the the IPFT in that sense acts like a kind of a decentralized Google Drive. Pretty simple where you can share access control to participants for instance to other scientists that are in the DA. Um but not essentially invalidate the IP by making it open. Um the next step for this is actually then you can now fractionize the IP. Uh so first you start out with a one ofone NFT and then um we've created something called IPs.

You can think of them as subdows now like um if uh if a DAO has a really strong research project that it's working on what many of our DAS have done is they've then uh done follow on tokenization where now individual subunits of the IP become tradable or you can exchange them for work or or funding. Um so yeah IPs can be exchanged for work funding or contributions around individual research product. And I'll walk you through a little uh case study that I think is really interesting. Um so in May 2023 um May 2023 the investment lead at Fizer uh suggested actually this project to Vita which was mut mutation specific codon suppression for aging and

longevity was an incilico study so incilico initially means just computer simulation essentially this is like a novel mRNA gene therapy um and which was extremely moonshot the DAO funded it for for roughly 90,000 Uh, and then the initial data that came back was really positive. But so you have to imagine the DAO purchased all of the IP for 90,000, right? The initial data that came back was very positive. Um, and then the DAO decided to do a follow on funding, but still because it was so risky, the Dow was like, let the community fund it. Let's see what happens. And so, uh, there was a sale, um, that raised, uh, this goes in here, that raised roughly 300 300,000 in June

last year. So, about 10 months ago um, and, uh, about 50 token holders participated in these Dows. If you own Vita tokens, for instance, you can now participate in these like sub uh, you can call them pre-sales or like like sub issuances. uh and then um started trading on unis swap uh at a 1.5 million FTV roughly um with that 300k and since then the research has been ongoing uh and um you can kind of see some of the price development here uh so this the unis swap liquidity pool stabilized at roughly 3 million FTV and following that further and further data drops happened and new data continued to be released

about the project and so now what happens is now you have a really you have a micro community that is very actively looking at the data that is actively joining the uh joining kind of the the data drops. Um they have some kind of often they have private information so they can join they can join calls that other that others can't and um uh yeah we think it's a really interesting example. So the the the research continues to be finite. Uh and um small tease, uh this the the research team is actually here this week and they're meeting with the Abu Dhabi uh health regulator to see if they can get it approved for a clinical trial. Uh which would be massive if that works. Uh

and and I I like I I think this is a really cool example of uh of financialization and what it actually does in terms of like discovering and moving an asset forward, right? Because now now also you have token holders here who are like what's happening? Give us updates. Did you look at the data? Let's look at the data again. They can make suggestions and and the essentially the funds around this project are managed uh through snapshot and a multisync. Um yeah, cool. So in summary, we are building towards a world where scientists spend 80% of the time doing the science and 20% applying for funding. Uh where anyone can fund and participate in science independent of institution and geography. Thank you.

[Applause] Yeah, thank you. Uh so you've been using this acronym IP a lot and I take you use it for intellectual property but it's a very general term and it usually means one of four things. It's either trademarks or patents or copyright or trade secrets. And uh if I understood correctly, this is something like trade secrets that these scientists generate something that they only tell to somebody and they are paying for it in some convoluted way. Did I understand it

correctly? Uh that's broadly correct. Yeah. So we we typically util uh utilize like sponsored research agreements. Sponsored research agreement or contract research agreements and the end result of those contract research agreement is you have a legal agreement that defines someone did the research right and someone owns the research and there might even be a split already within that and then all of the data it is owned by that by the contractual parties. What you can now do with that is you could take that, you could go to a patent office and be like, "Hey, look, I own this data. It was produced here."

And then you can file for a patent with it. You could say that that is a it is a form of a trade secret. Yeah, it it's it's kind of the basis that you would use to file patents. Yeah, I I personally find patents very boring and I really don't think it's where kind of where the future is. Uh however, if you want to work with industry, meaning with pharma companies or uh other biotech players, you kind of need to adopt a part of the current system. Um I think it gets much more interesting. So we have uh uh some of our newer Dows are for instance focused on neutropics. Uh neutropics are like cognitive enhancement supplements in essence. Uh but they can be used already

they can be used for a variety of indications. for instance, there's certain neutropics that will work that actually work very well to treat the symptoms of Alzheimer's. Um, and there there's no patents, right? And so now the the plan there is to directly go into commercialization, meaning you can have an online store. These substances are like they're like supplements, right? They're unregulated. Uh, and and so so that that's kind of the other pathway. Um but if you want to play with industry today, unfortunately still you need to work with with patents or create patentable IP. Um and yeah, what we do is we we push the patenting process as far down the line as possible because that actually increases the

value of the IP. Um and actually our hope is with something like IPFTs and this is already proving itself. Our hope is that because you've encapsulated the IP and because you can now create like you can you can issue tokens around it. You can use it for fundraising, but you don't need a you don't need a patent that is typically an equity vehicle that already massively helps the scientists. Yeah. Thank you. Hello. Great talk by the way. Really good. Thank you so much. Uh so you gave that example of that woman who like cured her own cancer, right? Do you think that like these dowels would be the way that humanity as a whole like

cures cancer? Uh I think we have so so I I I think I think at I I think at a very high level I think this is a this is potentially like a much more viable path toward um medicine and toward medicine and scientific development. like the speed at which the Dows are moving is much faster than biotech. Sure, they might be much less professional, right? In a in a in a certain way because like building in web 3, building a Dow is messy. It's political, but it's also like building in public, which is so new in this field, right? For scientists to build in public is is um and and we are trying to

enable to build in public while still maintaining like commercial viability. Um and but but so so to your question I think we're quickly going to see more innovation emerge from these Dows and like actually big headlines. The the thing also with people ask like dai like what is it achieved what is it doing this like science takes a long time for like outcomes but then the outcomes are like huge outlier outcomes um which which really change yeah can change people's livelihoods change people's health uh and um so one reason why I'm also very one reason I'm very bullish on the space is you have very like extremely innovative thinkers that have operated

at the fringes of scientific ific development up to date like yeah some of our earliest dows were focused on longevity longevity even back then was still a relatively French topic it's less fringe now uh longevity or or cryionics like and cryionics makes sense if you believe in space travel then it's like okay when when will we have space travel probably someday um I mean we already do to a certain degree but um and then uh we're currently working with uh Ed Bdon for instance who's one of the leading neuroscientists at MIT. He runs his own the Bdon lab. He runs a lab at MIT. He's like he wants to build it out with us.

And there's other we we just got in touch with Shinya Yamanaka the the um Nobel Prize winner for H. Yeah. Yeah. Japanese. Yeah. Um Nobel Prize winner who discovered the Yamanaka factor. Um and but so yeah the quality of people that are actually continuously coming into the space because the current scientific funding model is so broken is uh is is very high. Uh I think it's an incredibly difficult thing like building a da is very very hard but I really think it's worth it. I think crypto needs much more of these much more of

these use cases to really yeah to really succeed and for people to believe in science again. I think that's something like that's something really Yeah. inspires me. Yeah. Honestly, I didn't know what DSI was until you started talking. I was about to leave and then like you started talking, it caught my attention and now I'm like, "Ah, this is awesome, man. This is exactly what science needed." I used to study chemistry uh at university and I wanted to go into like cancer cure research and that sort of thing. But then like you said, I saw all the bureaucracy and all that BS that's involved in like getting funding and that sort of stuff and I immediately was turned off by you know becoming an actual chemist. And so I went into uh software engineering like

web 3 in this space. And now this unites those two spaces really nicely like you know the innovation and the decentralization of web 3 with the the the you know with with science innovation like which was being uh what's called gatekept this whole time and like you said this is the way forward 100% and it's amazing what you guys are doing. So yeah good stuff. Thanks for staying. Well it's

great, but I'm a bit worried about how these funding decisions get made by like popularity rather than scientific merit or expertise. you have a comment on that? Yeah. Um I wouldn't say I wouldn't say it's so the funding decisions get made through um yeah the funding decisions get made through typically scientific review committees within the DAO and so it's not that like anyone so it's not a nor like these Dows operate more like uh uh technocracies than they do as like open

democracies where like anyone can suggest a project and it's really hard for it to like really hard for it to not get funded. Uh and so the the Dows are pretty rigorous with regards to their spending and and how they allocate capital and typically the people that run the DAO on the inside are very very scientifically savvy. Uh yeah and and then ultimately it's it's like it is a capitalist system in the sense that like I think the like a capitalist system in the sense that like crypto is fundamentally very capitalist right it's like trading behavior and people follow the money and they uh and and one thing I still think we haven't had that yet but I think the

funniest science is the most likely to get funded meaning meaning because you're in crypto So I think people that things that naturally speak to to a crypto audience are more likely to receive funding. But that's what worries me. Yeah. Yeah. Yeah. Well, so yeah, but it just means I don't know. We one day we might have like um No. Yeah. But that's ultimately something that you can't really change, right? I think we might have like I don't know a synthetic biology project with like for like cats for a cat with like pink ears and like that suddenly gets like five million funding and then someone else is like oh hey I've been trying this cure for cancer for like two years and no one will find it can't it's

difficult to change uh to change one thing that I I I think would be really interesting is actually for um for layer one networks to consider um or like to consider delegating staking rewards to like funding basic research in a similar way that the government like if we consider blockchains in like nation states or like network states a government dedicates about 5% of its GDP to funding basic research right and then it doesn't really discriminate well it discriminates by needs but it's like it just gives out that money to like basic research all over a country right goes to the universities scientists fund I think something something similar in in

crypto could be really interesting. Cool. Thank you so much, [Applause]