THE WHITEPAPER FULL BREAKDOWN INTRODUCTION : If you are interested in the blockchain/cryptocurrency space, be it as a businessperson, investor or a developer, one thing you can’t/ shouldn't ignore is whitepaper. Say, you are considering investing on an ICO, you are importantly advised to read the white paper of that ICO. If you are unsure about what an ICO is, then please check out this article
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If an ICO hopes of becoming a successful campaign, a whitepaper is essential to persuade people to support its idea, product or service. More recently, more and more new cryptocurrency white paper presents new technologies that will change the industry. Due to this, whitepapers has recognized great value in the sight of investors, businesspersons and developers as well.
DEFINITION : Guessing enough, the introduction above must have given you a tangible clue to what it is. It is an informational written document presented stating the ICO's purpose, its entire architectural details, what it hopes to achieve and how it hopes to achieve it. All these are for the sole purpose of attracting attention and participation of investors, and other like-minds.
BENEFITS OF READING A WHITEPAPERThere could be more reasons to reading whitepaper than this, but these are the sole reasons for me;
1. For identifying how legitimate the ICO/Cryto is/can be. That is, by reading the whitepaper, there is a good chance of avoiding scams.
2. Value and motivation of the ICO/Cryto. What makes it special, different and worthwhile.
LIGHTPAPER : Like whitepaper, this also gives you insight into the plan and technology of the ICO/Cryto however, it is not technical and detailed like whitepaper. Some ICOs utilizes it thereby, many lose focus thinking they are having a whitepaper in study.
Most times, white papers can be literally confusing due to the use of technical words and made-up names. These are sometimes, the complications you find in whitepaper making it difficult to understand. However, If not certain of what a project is all about, then it is either the project is more advance than the knowledge you already have of it, or the project just doesn't have anything to offer, literally.
READING A WHITEPAPER CORRECTLYImagine, you have an ICO in mind, having few details is not enough to decide if it will be a good investment therefore, the whitepaper helps you by giving you all the reasons and evidence towards knowing how promising the project can/will be. Now, there are critical points almost all whitepaper possess but it could vary depending yet, still passes the necessary details. They are;
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INTRODUCTIONAn introduction gives an overview of what the whitepaper contains and what the reader can expect. briefly explaining the background establishing credibility. An introduction is important and time saving for the reader or audiences.
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PROBLEM PRESENTATIONAn insight to what problem the project is trying to solve in context and why the project is needed to begin with. The clearer the presentation of problem to the reader, the simpler it becomes to see its purpose and therefore the potential benefits of the project. Before you invest your time or resources in any project, find out to see if another project is trying to solve the same problem and which is better
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SOLUTION PRESENTATIONThis becomes a very technical section of the whitepaper since it details the solution to the established problem . It shows how attainable and realistic the project can be and the competency of the team and the understanding they have of the technology as to achieve a success. Also, it details the applications of project like, the application of Ethereum as a decentralized platform that runs smart contracts. The Bitcoin white paper is a good place to start if you hope to get a view of what a good white paper looks like.
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TECHNICAL DETAILSWhen an understanding of the solution to the established problem has been made, then you are shown
HOW this solution can be made possible and the problem handled. This is usually filled with technical terms, analogies and crypto-slangs, technologies used may be emphasized or may not however, be ready to get detailed about blockchain, security aspects and tokens.
-ROADMAP/CROWDSALEThis will include all relevant launch dates, bonus schemes, how the funds raised will be used. This display project’s objectives, and time ranges at which they are hoped to be achieved. Details such as; duration of the token sale, number of tokens that will be on sale, e.t.c. The more detailed and practical the roadmap, the better the expectations of investors can be managed. With these details, an investor will know when things are fall out of place assuming the project consistently fail to meet its stated goals at its promised time frame.
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THE TEAMS BEHIND THE PROJECTThis carefully describes the teams involved and their familiarity with the crypto sector coupled with their experiences. In total, a view of the team's competency will be laid down to prove to the reader that the project is in good hands and minds.
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FINANCIAL BENEFITSHow will the project get to the market, how will it be utilized by customers and organizations, what the worth is going to be, how it will save investors towards a profitable means, what kind of money supply management will be put in place, and how it will benefit the cryptocurrency community.
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CONCLUSIONActing as a closing statement, summarizing the project’s key points , the conclusion is meant to give hope, and end on a good note. It may speak about the future steps and include a call to action to get involved in the case of an upcoming token sale.
MY FINAL ADVICE TO ALLStudying a cryptocurrency whitepaper is about trusting your gut after looking for what is very crucial in the whitepaper. A good whitepaper doesn't entirely guarantee a successful project, however, a bad whitepaper can give out a project that is sure to fail. Deciding to invest in a project means and requires you to follow ideal investment ethics and
DON'T INVEST MORE THAN YOU CAN LOSE, EVER!.
