How to DYOR “Whitepaper Edition”

Good Morning everyone!

Last weeks, we discussed, in a few articles, how to analyze a project, if you missed these articles, scroll on my profile and read them first!

Today we’ll see all the information you need when you check a whitepaper.

What are Whitepapers?

Whitepapers are informational documents used to explain and promote technical projects and are essential for any cryptocurrency project trying to get off the ground and gain legitimacy.

Since Satoshi Nakamoto published the Bitcoin white paper in October 2008, these documents have been used to explain why a particular cryptocurrency was adopted, what problems it was designed to solve, and how it differed from its competitors. Analyzing a white paper can be difficult because it often contains incomprehensible jargon and buzzwords. They are not limited to cryptocurrencies but are used to explain many other types of projects, but at this point whitepapers have become the industry standard. This guide will show you how to read and understand whether a project offers a real solution or just a lot of fluff.

Common parts of Whitepapers

Not every white paper contains all sections below, and information can be categorized differently.

-Abstract: This is the project summary that appears at the beginning of the whitepaper. It outlines the goals of the project and tries to get the reader to read the rest of the documentation.
-Introduction: This part of the whitepaper attempts to quickly cover basic concepts such as B. What is a blockchain, while presenting solutions aimed at addressing cryptocurrency projects.
-Context/Problem Definition: This is where the development team started to make the case for launching its unique cryptocurrency solution. The project's target market, challenges that need to be addressed, and critiques of current solutions can all be included here.
-Solution/Product Description: With the context of a problem laid out and the inefficiencies of current solutions addressed, the development team pivots to detailing their solution and what it brings to the table. This section also includes the platform that the project will be released on, exactly what the project does, and how it's better than any other solution.
-Tech: The nitty-gritty of the tech that powers a project is addressed here. A section like this might include a description of what’s being used to build the solution, like developer tools and programming language.
-Token and Tokenomics: This is arguably the most important part of any whitepaper for potential investors. A token’s role in a project’s ecosystem and how it will be managed are usually covered in a section like this. It could also include the benefits of holding the token and more details on its planned use cases.
-Team: The people behind any project are one of the most important things to consider before investing in any crypto. Thankfully, good whitepapers will include a dedicated section to introducing the project’s team. This could include information like previous work experience, years in the industry, and individual roles within the team.
-How to Buy a Token: Whitepapers also function as a kind of marketing document for a new cryptocurrency project, so it’s possible they will include a section on how to buy the token. Launch dates, exchanges, and wallet addresses for transparency could be included here.
-Roadmap: The roadmap is where a team will lay out their future vision for the project. A roadmap will most likely include general milestones, like a certain number of holders or getting listed on centralized exchanges, and a general timeframe in which the team is aiming to have the milestone completed.
-Conclusion: This section is self-explanatory. Here the project and the problem it’s trying to solve are summarized and any call-to-action is reiterated.

It's important to remember that the whitepaper represents the team's view of what their project is trying to do and the benefits it will bring. They can serve as marketing documents for the project and its team, trying to communicate to readers why their project is the best document.

More research is key before making any significant investment in any coin or token. Reading articles written by people not involved in the project (Medium) and checking external sources are two ways to verify the claims made in the whitepaper.

In the end, enough research should be done to be comfortable with a project and be able to explain why a project is worth investing in.