What’s a Token Launch or Token Auction?

Token launches enable BioDAOs to crowdfund a treasury by launching tokens to their communities. In essence, a project receives bids from its members to raise funds for research and development, and provides tokens back to the community in exchange that can be used for governance. These auctions are often conducted on Ethereum, using smart contracts to facilitate the execution of the fundraising without a trusted intermediary, and to ensure transparency and immutability.

How does the auction work?

Tokens auctioned using the BioDAO launchpad leverage Batch Auction smart contracts developed by Gnosis. In a Batch Auction, the token auctioneer (the BioDAO) offers a certain number of tokens for auction to its community. Participants place bids in the form of ERC-20 tokens, such as USDC, in exchange for the BioDAO tokens being auctioned.

The auction occurs over a set duration during which participants can place bids, and funds can be raised. At the end of the auction period, all bids are sorted from highest to lowest. The final clearing price is calculated to be the price that exhausts supply of all tokens being auctioned. All bids at or above the clearing price are filled, and will receive an allocation of tokens. This pricing mechanic ensures a single, fair price of the token for the entire community.

For more information about Batch Auctions, please see the following articles: here and here.

How do I participate in the token launch using the Launchpad?

To participate, you need to connect your wallet. You can either use an existing wallet or log in with your social media credentials to create an embedded wallet with Privy, our wallet partner. Before placing a bid, be sure your wallet is loaded with the necessary bidding token as well as ETH to pay for the transaction.

How do I place a bid?

To place a bid, you need to connect your wallet and head to the Make Your Bid section. Specify the bid amount you're comfortable with and your maximum desired price per token. Ensure your bid amount exceeds the minimum bid amount and stays within your available balance.

How can I track the status of my bids during the auction?

You can track all bids made and your bids in real-time through the Activity, in the All Bids and Your Bids tabs. This Activity list provides a chronological view of all the bids made, helping you stay informed about their status.

What do the bid price alerts in the Activity section mean?

The bid alerts are a list of your previous bids, and based on the current and projected prices of the auctioned token, whether your bids have been outbid or are at risk of being outbid. If the alerts indicate that your bid has been Outbid, consider cancelling and replacing your bid at a higher price.

Can I cancel my bid after placing it?

Yes, bids can be canceled until a date and time indicated in the auction Live Info. Keep an eye on the real-time bid price status in your activity to track the price of your bids relative to the current price of the token on auction.

How can I claim proceeds after the auction concludes?

Once the auction ends and it’s settled, you can claim your allocation and/or refund. You will need to visit the auction page, connect your wallet and go to the Claim section on the right side. The claimable outcomes include successful bids with token allocation, refunds for unsuccessful bids, and hybrid claims that combine allocation and refunds.

What happens if my bid gets outbid by others?

If your bid gets outbid, you will receive alerts indicating the need for action in the Activity section. You can cancel your previous bid and resubmit with a higher token price for a better chance. If you don’t cancel bids that end up below the final clearing price of the auction, those bids will be refunded once the auction ends.

What is the purpose of a whitelist or KYC process?

A whitelist or Know Your Customer (KYC) process is implemented by some Launchpads to ensure compliance with certain regulatory requirements. Depending on the bid amount participants may need to complete the KYC process and get whitelisted to be eligible to participate in the token sale.

Are there any restrictions on participation in the Token Launch?

Some token sales may have restrictions on who can participate, so important to contact the BioDAO prior to participating to check your eligibility.

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