How it works.

Here is a quick guide on how everything
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How it Works

Here is a quick guide to how everything on our platform works so that you can get started.
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1. Crowdfunding For Basic Research in Drug Development

At present, basic research in early-stage drug development is almost exclusively performed by academics and funded through public money. It is often this early stage that drives innovation and where valuable new discoveries are made. Yet, the selection process of which discoveries should receive funding for further development, is closed-off to the general public.

We believe that anyone should be able to partake in this process, and that crowdfunding can act as a necessary tool to achieve that.

On Molecule Catalyst, the focus of securing funding shifts away from appealing only to grant providers, to exciting the public and giving them access to novel research causes and projects. Ultimately, crowdfunding democratises research funding and directly benefits society by bringing more people into science.

Molecule Catalyst is designed to provide a novel crowdfunding solution for research projects in drug development and bring new treatments closer to patients.

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2. Projects Review and Approval

Molecule Catalyst aims to support research initiatives for early-stage, experimental studies in drug discovery. Anyone working in these studies can submit their research proposals through our website. Make sure that you have the necessary rights to act on behalf of the associated team or organisation and that all results can be shared publicly.

Before a fundraising campaign launches on the platform, the projects undergo a rigorous, scientific review process by the Molecule Team and its associated advisors.

This is currently the only centralised step the Molecule team is involved in. After approval, every project is managed in a fully decentralised manner by the project lead.

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3. Engagement with Researchers

Researchers create their projects with outlined goals/hypothesis, the outcomes of which, will be published when specific funding goals are reached before starting the campaign. Molecule Catalyst has been designed in such a way that it incentivises researchers to provide updates as soon as progress is made, so that they actively engage and build trust with their contributor base. These updates can be found on the individual project pages.

You are able to directly assess progress and whether the teams are following through on their promises.

This allows you to make informed decisions on whether or not you are still interested in supporting an initiative. Additionally, the Molecule Team keeps a direct line of contact with the research leads and will conduct check-ins on a regular basis.

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4. What you need to support a research project.

Instead of relying on credit cards and other traditional payment providers, Molecule Catalyst uses cryptocurrency technologies to collect and distribute contributions.

Even though the website content is available for every visitor, a few prerequisites are required before you can contribute to research projects. Have a look at this list below:

Please keep in mind that we are referring to a specific set of tools in this guide, and that there are other ways to achieve the same results while holding and transacting with cryptocurrencies

  • 1.
  • Coinbase
    is a cryptocurrency exchange that currently provides one of the simplest routes to obtain various major digital currencies. You are able to create a free account, register and link your bank account or credit card and you're all ready to go.
  • 2.
  • Dai
    is the cryptocurrency used to support listed research causes on Molecule Catalyst. The main reason for using it, is that its value is pegged to the US Dollar. Dai is a stablecoin that aims to be worth exactly 1 US dollar and thus 1 Dai is equal to 1 USD. We do not want fundraising campaigns to be affected by volatile fluctuations in everyday cryptocurrency exchange rates. Dai is available for purchase through Coinbase.
  • 3.
  • Ethereum
    is a blockchain technology which Dai is built on, and in its current state, small amounts of Ether are needed to use Dai. Therefore, please ensure that you have purchased an amount of Ether on Coinbase before attempting to transfer Dai.
  • 4.
  • MetaMask
    is a browser-based wallet available as an add-on for Chrome, Firefox and Opera, and is needed in order to interact with our application. Please follow their installation guidelines for creating a new account. It provides a simple interface, to sign blockchain transactions and transfer cryptocurrencies. MetaMask takes care of storing your cryptocurrencies and it is your responsibility to keep the account credentials secure. If you want to contribute to a research project, your funds should be stored in this wallet.

If you do not have MetaMask on your current device - visit this easy to follow guide to see a step-by-step on how to install MetaMask on a new device and other devices before using our platform.

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5. Fundraising with Molecule Catalyst

Molecule Catalyst uses blockchain technology to create a better crowdfunding experience for researchers and contributors.

This also means that our service works differently compared to similar crowdfunding platforms. Below is an outline of the process:

  • 1.
  • Discover
    Each fundraising campaign on Molecule Catalyst is operated by a fully autonomous Ethereum smart contract system that controls all the different transactions.
  • 2.
  • Contribution
    You can contribute to any ongoing research project using Dai, along with the Ether required to cover the transaction costs.
  • 3.
  • Supporting a Research Project
    The majority of your contribution is directly forwarded to the projects funding vault, which is controlled by the research team. This supports the funding campaign of their research project.
  • 4.
  • Stake and Project Tokens
    A small, second portion of your contribution is gathered in a separate project stake reserve. In return for your stake, you receive project tokens. The value of these tokens increases when additional people contribute to the fundraising campaign and hold onto their tokens. This acts as a reward system for early contributors.  
  • 5.
  • Research Updates
    Researchers post progress updates and results from experiments to build confidence within their contributor base; ensuring that supporters hold on to their project tokens, and keeping the token price high.
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6. Token Bonding Curves Explained

Token bonding curves might sound very intimidating but they are actually quite a simple concept.

A bonding curve is a piece of code that mints and burns new tokens in exchange for a certain type of collateral.

On our platform the collateral used is Dai. The curve automatically determines the rate of exchange between Dai and the distributed token based on demand. When more tokens come into circulation, the token price increases, and vice versa, decreases when they are burnt.

Molecule Catalyst uses a special type of token bonding curve. In our system, the “buy” price for tokens is always higher than the “sell” price. This means that you always pay more for minting tokens than what you would get back for burning them. The difference between these two values is what provides the funding for the research project.

The most common way to visualise token bonding curves is by using a supply graph that shows circulating token supply on the x-axis and the price to mint a single token on the y-axis.

See an instructional example of this in practise in the next section on this page.

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7. An Example of Fundraising using Token Bonding Curves

Alice wants to support an interesting research project she found on Molecule Catalyst. She is the first person who supports the campaign, thus, the project stake reserve is still completely empty. She decides to back the project with 100 Dai, and her total contribution gets divided into two parts:

1) Support: 95% of the funds, i.e 95 Dai, is forwarded directly to the funding vault controlled by the research lead.

2) Stake: 5%, i.e 5 Dai, will be stored in the project stake reserve.

In return for her support, Alice receives 300 project tokens. This number is automatically calculated by the bonding curve of this fundraising campaign. She would immediately be able to sell these tokens for 5 Dai, but since she believes in the success of the campaign, she holds on to the tokens for now and promotes the project in her personal network.

Bob hears about the project from his friend Alice. He is excited about the novel treatment area and decides to support the cause with an additional 100 Dai.

Again, 95 Dai (95%), is sent to the research vault/reserve and 5 Dai (5%), is staked into the total project market. Since the price for tokens is now higher than when Alice supported the campaign, Bob only receives 200 project tokens.

At this point, Alice could sell her 300 tokens for 6 Dai (calculated by the bonding curve based on the new circulating supply of 500), thus, she has increased her stake value and is rewarded for promoting the project.

Ultimately, the project token price acts as an indicator for how well the project is doing. If the contributors remain confident due to the progress they can see from the researcher's updates, the price for the tokens will continue to increase over time. On the other hand, if contributors start to sell their tokens, the value in the market will drastically decrease, indicating a lack of confidence.

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8. Funding Campaign Structure

Fundraising campaigns on Molecule Catalyst are divided into several phases and funding goals. They are proposed by the researchers based on budget needs to conduct the experiments planned for the different project phases. The timeline and specific amounts become immutable once a campaign is launched.

Even though contributions are sent directly to the research funding vault, Molecule Catalyst is an all-or-nothing funding platform.

This means that the funding goal of the current phase has to be reached before the research team can access the funds. If a funding goal is not reached or the time to reach it runs out, you can get your contribution and project stake back by selling your project tokens.

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9. Ending of Campaigns

The fundraising campaign for a research project is automatically terminated when the last funding goal is reached.

At this point in time, you will no longer be able to contribute to the project in exchange for tokens. The Dai that is still held in the project stake reserve can be reclaimed by the token holders.

However, a new token price is calculated by dividing the value of the project stake reserve by the number of tokens in circulation. This creates a fair redistribution price and evens out rewards between early- and late- stage contributors. The graph below shows how this new price is determined.

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Diseases
Aging &
longevity
Psychedelic
studies