Catastrophic funding cuts in scientific research – can blockchain be the solution?

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We’re going through one of the worst economic instabilities, and it’s getting worse. As governments struggle to keep their economies afloat, spending cuts are an unfortunate but understandable reality.

While public spending and private investment have been scaled back in several sectors, scientific research has seen a rather shocking drop.

Alone in the UK, government funding for research and development was cut by almost 50% last year. In Europe, over $100 million in scientific funding has been suspended since the Russia-Ukraine conflict began earlier this year.

In addition to state grants and subsidies, private investments in scientific projects are also declining significantly. With VCs and angel investors becoming more rigid and constrained, securing investments for scientific research is now a major challenge.

So how can scientists and projects explore effective funding opportunities to support their research in this rather challenging environment? Blockchain could be the ultimate answer.

Introducing DeSci – i.edecentralized science

DeSci is an innovative blockchain use case that establishes a public infrastructure for the transparent and equitable creation, crediting, distribution, funding, verification and storage of scientific knowledge. It is a decentralized ecosystem where scientists and researchers are incentivized to share their knowledge and research with the general public.

DeSci is based on the fundamental concept that scientific knowledge should be available and accessible to everyone. DeSci fulfills two different functions.

First, it makes the research process transparent and the research information publicly available so that everyone can benefit. Second, it connects scientists and researchers directly with innovative investors without the need for a central intermediary.

Funding is the greatest challenge facing scientific research in the 21st century. Several transformative projects have failed over the past two decades due to insufficient funding or lack of investment.

2021 e.g. revolutionary research on using AI to treat maternal health was halted in Brazil after the government backed down on its original $106 million in funding. Also several critical research on climate change Initiatives have been canceled in Canada for the past two years.

Blockchain technology has a unique potential to solve this problem by unlocking new investment streams for such projects and creating a sustainable ecosystem of the next generation of decentralized science.

How can DeSci solve the financing crisis

Traditionally, the bulk of scientific funding has come from centralized agencies, whether it be in the form of government grants, venture capital funds, or corporate investments. Actually almost 75% of all scientific research is financed from state funds.

DeSci uses blockchain technology to tap into a wide range of diversified funding sources, including DAOs, crowdfunding, and square donations.

Autonomous decentralized applications allow scientists to work together to fund their projects. You can potentially monetize research rights and contributions through NFTs, adding more sustainable value to the broader scientific communities.

Most importantly, DeSci is revolutionizing the concept of crowdfunding for scientific research. Crowdfunding has brought significant benefits to startups and new businesses over the years.

However, it has not yet been fully exploited in science and research, as public knowledge about scientific projects is often limited and such projects are often too complex to attract the attention of the general public.

Using mechanisms such as DAOs and square donations, scientists can match projects with like-minded individuals and grant them governance rights in exchange for their funds and contributions. This creates a fairer and more beneficial ecosystem for crowdfunding.

The decentralized model can support more time- and cost-effective research initiatives. On average, scientists and researchers spend 50% of their time Drafting proposals and funding applications.

In addition, a large part of the profits generated from these research projects are accumulated by third-party intermediaries such as publications or distributors. DeSci eliminates these intermediaries and scientific discoveries are shared publicly through scalable tokenomics.

The obstacles and limitations of DeSci

Decentralized science is fascinating on paper, but several concerns and limitations limit its application and adoption. DeSci suffers from the same problem it tries to fix missing investors. Since the concept is integrated with blockchain technology, the first investors will likely come from the crypto industry.

Cryptocurrency investment and trading is the largest use case of blockchain so far, so most investments in a new blockchain project will come from this niche.

This will significantly limit the investment reach for DeSci as the overall crypto market capitalization is lower than that of traditional tech companies like Apple and Amazon. As such, it will be a challenge for such projects to raise enough capital or investment to gain significant traction.

To address this problem, the decentralized science movement needs large professional actors. Some recent DeSci projects have attracted significant investors and associated companiessuch as the University of Copenhagen, BreyerCapital and Scheibye-Knudsen Lab.

Emerging projects, however, need to attack more big-name investors to influence broader adoption of decentralized science.

There are also the more obvious ethical challenges. Such projects need to be decentralized, but affiliation or partnership with large investment firms can ruin the principles of decentralization. Therefore, emerging projects must exercise caution in forming partnerships and seeking investment.

After all, it is also about trust and credibility. With each centralized management unit, DeSci platforms require transparent self-regulation.

Because they have an effective and credible governance model, they can attract enough users or professionals.

In summary, DeSci platforms offer an innovative model to solve the global scientific research funding crisis and facilitate transformative innovation through the equitable distribution of scientific knowledge. However, the challenges of adequate investment and regulation continue to overshadow this emerging industry.

New iterations of DeSci and more robust frameworks may solve these problems in the future and pave the way for a new generation of science and research.

Dimitry Mihaylov is Associate Professor at the National University of Singapore, Contracts Expert at the United Nations and Chief Scientific Officer at Farcana.

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Featured image: Shutterstock/Digital Store/Nikelser Kate

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