# Research Tokens

Every PepFund campaign issues a unique research token at creation. These are SPL tokens on Solana, built on the Token-2022 standard. They are not speculative financial instruments. They are structured ownership instruments that represent a backer's stake in a specific research project.

***

## What Research Tokens Represent

Research tokens carry three rights:

### 1. Governance Rights

Token holders can participate in milestone reviews. During a milestone's review window, token holders can flag a submission if they believe the evidence does not satisfy the milestone description. Flags are weighted by token holdings. This gives backers a direct accountability mechanism over how their capital is used.

### 2. IP Access Rights

When a campaign completes and research outputs are published, token holders receive first-mover access to the research under the IP terms set at campaign creation. Depending on the researcher's configuration, this may include:

* **Open access:** All outputs are public; token holders receive attribution credit
* **Preferential licensing:** Token holders receive a discounted or priority licensing position for commercial applications of the research
* **Revenue participation:** If the research generates licensing revenue (e.g. from a patent or commercial dataset), token holders receive a proportional share

### 3. Proof of Participation

Research tokens create a permanent, onchain record of your participation in a specific research project. This is publicly verifiable and portable across wallets.

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## Token Allocation

The total token supply is defined by the researcher at campaign creation and is immutable once the campaign moves past the review stage. Supply is distributed across four buckets:

| Allocation            | Recipient                  | Notes                                                                        |
| --------------------- | -------------------------- | ---------------------------------------------------------------------------- |
| Backer allocation     | Campaign backers, pro-rata | Minimum 51% of total supply                                                  |
| Researcher allocation | Campaign creator and team  | Vests linearly over the milestone schedule                                   |
| Protocol allocation   | PepFund treasury           | Fixed at 5% of total supply                                                  |
| Reserve               | Held by campaign PDA       | For future community allocation; researcher configures post-campaign release |

**Example:**

A researcher creates a campaign with 1,000,000 total tokens and a 60% backer allocation:

* 600,000 tokens distributed to backers pro-rata
* 250,000 tokens vested to the researcher over milestones
* 50,000 tokens to PepFund
* 100,000 tokens in reserve

If you contribute $1,000 to a campaign that raises $50,000 total (2% of total raised), you receive 2% of the backer allocation: 12,000 tokens.

***

## Token Distribution Mechanics

Tokens are not distributed at campaign completion. They are minted and sent to backers **at the moment of contribution**, in the same Solana transaction. There is no separate claim step.

If the campaign fails to reach its goal, research tokens have no further utility. Backers claim USDC refunds from the escrow. The tokens remain in backer wallets but carry no rights against a failed campaign.

***

## Non-Transferability During Active Campaigns

Research tokens issued during an active campaign are **non-transferable** until the campaign concludes (either reaches `Funded`, `Failed`, or `Complete` state). This prevents a secondary market from forming on in-progress campaigns, which could create perverse incentives around milestone disputes.

This is enforced by the `TransferHook` extension of Token-2022, which the PepFund program validates on every transfer instruction.

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## Post-Campaign Token Behaviour

Once a campaign completes, the researcher's configuration at creation determines what happens:

| Configuration      | Behaviour                                                                  |
| ------------------ | -------------------------------------------------------------------------- |
| `Transferable`     | Tokens become freely tradeable; holders may sell or transfer               |
| `Non-transferable` | Tokens remain soulbound; no secondary market                               |
| `DAO-gated`        | Transfer requires approval from a governance threshold of existing holders |

Most beta campaigns default to `Transferable` post-completion. Researchers should consider this choice carefully, as a secondary market in campaign tokens can create speculative dynamics that may not align with the research community's interests.

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## Researcher Token Vesting

The researcher's token allocation vests linearly over the milestone schedule. Each milestone release is accompanied by the proportional release of researcher tokens from the vesting PDA.

If a researcher's campaign fails before all milestones are completed, unvested researcher tokens are burned. Vested tokens (from successfully completed milestones) are retained.

***

## Revenue Participation

If the researcher enables revenue participation at campaign creation, any licensing income attributable to the research (patent royalties, dataset licensing fees, commercial IP agreements) is distributed to token holders proportionally.

Revenue is distributed via a program instruction that the researcher calls with the USDC amount to distribute. This is currently a manual step; automated revenue routing via oracle or royalty registry is on the roadmap.

{% hint style="warning" %}
Revenue participation is not a guarantee. Most research does not generate licensing income. Do not contribute to campaigns solely based on anticipated revenue distributions.
{% endhint %}

***

## Token Metadata

Each research token carries onchain metadata pointing to a permanent Arweave record containing:

* Campaign title and abstract
* Researcher ORCID iD
* Token rights configuration (governance, IP terms, revenue participation)
* Campaign Solana address

This metadata is stored using the `MetadataPointer` extension of Token-2022 and is updatable by the researcher post-campaign to reflect changes in IP status (e.g. a patent being filed or granted).


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