A few days ahead of the auction, Cohen said he expected alums, donors, philanthropists, as well as DAOs, would vie for the digital asset related to groundbreaking cancer research conducted at the university during the 1990s.
Besides the FiatLuxDAO group, the auction attracted a couple of other bidders.
"I'm pleased we cleared the $50K threshold," said Cohen. "We tried to not set expectations, but at the same time ‘think big.’"
He added that the Berkeley team would debrief on Tuesday’s auction and potentially plan for more in the future.
UC Berkeley says it is the first academic institution in the world to use a non-fungible token (NFT) to auction
off the science and correspondence behind a Nobel discovery.
Bidding began at 12:03 p.m. today on “The Fourth Pillar,” which includes the scientific findings behind James P. Allison's invention of cancer immunotherapy.
The first bid was for 12.00 ETH (Ether), or just over $31,000.
The piece includes 10 pages of disclosure documents and related correspondence from 1995 detailing the invention of the cancer treatment developed by Allison, an immunologist who was then based at Berkeley.
Allison shared the 2018 Nobel Prize in medicine for this work.
The digital artifact documents some of Allison's first steps in developing the groundbreaking way to treat cancer.
"We titled this NFT 'The Fourth Pillar' based on Allison's statement that this his invention is the fourth pillar against cancer," said Mike Alvarez Cohen, director of innovation ecosystem development at UC Berkeley's Office of Technology Licensing, and the person who first came up with the idea of auctioning off university research papers as NFTs about a month ago. "There's surgery, there's radiation and there's chemo. And this is now the fourth area."
Allison was the subject of the documentary, which came out in 2019.
Highlighting Groundbreaking Research and Innovation
Cohen said the auction is first and foremost about driving awareness of UC Berkeley's proud research history and ability to innovate. But he thinks these auctions could be a potential new revenue stream for funding future scientific research, as well as a new category in the burgeoning cryptocurrency marketplace.
"This is a grand experiment," Cohen said. "And we're not quite sure how much this will bring in."
The university, which will spend close to $1 billion this academic year on all of its “sponsored research,” a sum that includes federal, industry and foundation-sponsored research grants, set a reserve price at 4 ETH (Ether) for the NFT auction — a sum roughly equivalent to $10,000. (One ETH is about $2,500.)
With setting the price, the university tried to "strike a balance between making it accessible for people to bid on, while not undervaluing the asset," said Medha Kothari, a crypto-focused software engineer and UC Berkeley alum, who worked with the university to set up the NFT along with Justine Humenansky, a fellow alum and venture capitalist.
"Some big donors might be interested," Humenansky said. "NFT collectors … and Berkeley has a lot of alumni that work in the crypto industry. And so we wouldn’t be surprised if we saw some participation from them.”
Berkeley will get 85% of the proceeds from the NFT auction, with the hosting platform taking 15% in fees. Humenansky said the money will be spent on research and education, and to offset the carbon footprint associated with the auction. NFTs tend to consume a lot of electricity-gobbling computer power.
The university could benefit financially from the sale of the NFT beyond the auction. If the piece is later resold on the secondary market, Berkeley will receive 10% of that sale.
"NFTs are a very effective way that organizations, individuals, charities and nonprofits are thinking about how to fundraise for themselves," said San Francisco-based cryptocurrency venture capitalist Maria Shen. "Not only do they receive the funds when the entity is sold, every single time that the NFT is sold afterwards, these organizations and individuals and causes are going to be able to receive a fraction of the sales, capturing a part of that secondary sales in perpetuity."
The Growing Marketplace for NFTs
NFTs, which have stolen global headlines in recent months, are unique, one-of-a-kind digital assets that reside on a blockchain platform (a digital ledger that enables transactions to be duplicated and distributed across the entire network of computer systems on the blockchain, making the transactions visible to all and very difficult to change or hack) and can be bought and sold using cryptocurrency (a type of digital currency).
NFTs typically represent digital graphics, photographs, videos and sound files. They have become associated with the digital art world, most prominently, the historic $69 million auction sale in March of work by South Carolina artist Mike Winkelmann, also known as Beeple.
But lately, other types of digital assets are starting to sell for large sums on blockchain. Three of the most prominent such examples: the $2.9 million sale of the very first tweet sent by Twitter founder Jack Dorsey, New York Times columnist Kevin Roose's sale of an NFT depicting an article the journalist wrote about NFTs (which garnered $560,000 for the paper's "Neediest Cases Fund"), and former National Security Agency employee and whistleblower Edward Snowden's $5.5 million NFT sale in support of the Freedom of the Press Foundation.
But while a growing number of individuals and nonprofits are starting to see NFTs as a potential revenue stream, they're very new to the education landscape.
"UC Berkeley is really ahead of the curve," said Shen.
Berkeley is one of the first academic institutions in the world to use an NFT to auction an asset related to research conducted within its walls.
Yale set up a similar, though much smaller, NFT auction at around the same time. The university auctioned off a digital artifact — "Anscombe’s Quartet" — paying homage to a classic piece of research from the 1970s by statistician Frances Anscombe. At the time of writing this article, with just five hours to go in the 24-hour auction, the Yale NFT had garnered only one bid, equivalent to less than $1,500.
The Genesis of Berkeley's NFT Auction
Berkeley's Cohen said he dreamed up the idea for UC Berkeley's first research-driven NFT after hearing friends and family discuss the Walter Isaacson recently released nonfiction book "The Code Breaker," about UC Berkeley biochemist Jennifer Doudna's work in CRISPR gene editing, which also won a Nobel Prize.
"A lot of my friends and family told me, 'Wow, we didn't realize that this amazing gene editing technology, this potential invention of the decade or century, came from Berkeley,'" Cohen said. "And so I thought, maybe we should do a better job of marketing and bringing awareness to that."
Dorsey's and the New York Times's auctions, both of which benefitted nonprofit organizations, served as further inspiration, Cohen added.
Cohen and his colleagues decided to focus on documents related to Nobel Prize-winning research. They delved through case files to find invention disclosures for Allison's immunotherapy breakthrough and the CRISPR gene editing discovery.
"And that's when I realized, there is some amazing history here and we should make this public," Cohen said.
He chose 10 pages from the immunotherapy files that he thought would be of the greatest public interest, including a fax showing key data points along with Allison's handwritten annotation.
Getting UC Berkeley's auction up and running in a matter of weeks was a major challenge. In addition to getting buy-in at the very highest level of the administration, the university, which owns the copyright to the research documents, had to work through a variety of legal, marketing and technological issues.
"We had to turn the 150-year-old institution into a startup," Cohen said.
Cohen said UC Berkeley worked with a designer to create the digital piece, which was minted on May 27 on the Ethereum blockchain. The sale happened on the Foundation platform, an NFT auction marketplace that uses the Ether cryptocurrency. (Foundation has hosted some of the most prominent auctions in the space, such as Snowden's.)
Cohen added that UC Berkeley plans to launch a second NFT auction of an artwork based on CRISPR documentation.
Allison, the scientist who came up with the immunotherapy breakthrough upon which Berkeley's NFT artwork is based, said he was surprised and happy when the university approached him about turning his research into cryptocurrency auction material.