In the modern world many projects make an important decision to run an ICO (Initial Coin Offering). They create a blockchain-based platform which requires a lot of funds and investor’s support. Most projects use Ethereum blockchain in order to make their plan come true – that is why Ethereum is very popular on the market not only as a token, but also as a product. Each project needs to have a well written white paper in order to raise funds and find investors. White Paper is an official document of the project, which incorporates a comprehensive description of the project, technical details of the product, judiciary aspects, team outline, etc. A good white paper should include all important information about a product so the ICO can make a decision based on the info found in it.
Normally a white paper includes the following chapters:
- Table of contents
- Introduction (which includes both problem and solution
- Review of used technologies
- Overview of the system
- Economic model of the system
- Road map
- Token sale details
- Team and advisors
- Legal details
Some projects also include other chapters in their white paper, such as disclaimer, overview of the market, etc.
How to create a high quality white paper
An ideal white paper should include all aspects of the product – legal, technical, economic, etc. You should notify the ICO participants about any risk or restriction connected to a project that you are presenting. For example, the ICO industry is banned in the USA, China, Nepal, Bangladesh, Macedonia, Bolivia, Ecuador, Pakistan, Algeria and Morocco. Some other countries heavily regulate the ICO sector, so each participant needs to be notified about legal restrictions and consequences. The white paper creators need to learn all possible aspects or invite a lawyer who would research this topic. It is also important to notify an ICO participant that there is a certain number of risks associated with the ICO. Investing in the product does not guarantee a high profit and the success of the product. Some projects also create an official message from the project CEO calling on all potential token holders.
In the next WP chapter you need to describe the difficulty that your product is aiming to solve. Don’t forget to mention why the difficulty is significant on the modern market and what solution does your product offer.
It is crucial to catch the ICO participants’ attention: you invest in new possibilities and benefits that the product is offering to a market. No one wants to participant in a project which is mainly talking about the disadvantages and challenges. Be more positive when talking about the product! Use more pictures, tables, graphs. Show how your project is going to change the world!
Do NOT plagiarize! Plagiarized white paper is the first sign that a project is a scam! Check each part of the WP on special plagiarism search engines (there are plenty of them in the internet so it should not be a problem).
As of the end of June 2018, there are more than a thousand cryptocurrency projects that actually ceased to exist. Among the main characteristics of such projects are: no hints of any developments or future activity, as well as frank scams, including BRIG, the fraudulent project of the brothers Jack and Jay Brigov, Titanium, whose investigation is handled by the Securities and Exchange Commission USA (SEC), CryptoMeth, Droplex, OreoCoin and RouletteCoin. It is noteworthy that all these dead projects attracted several billion dollars of investment.
The results of the Satis Group study showed that in fraudulent ICO in 2017 they collected more than $ 1 billion. 271 projects were convicted of plagiarism when drafted in white paper, had employees who pretended to be other people, or conducted other dubious activities.
Normally a white paper should not be longer than 25-30 pages. You are not writing a book! Your goal is to create a well-written documents, which touches upon various aspects of the project. It should be easy to follow and understandable for people with different backgrounds. Your whitepaper needs to be translated to as many languages as possible. Some project create Bounties in order to find people who are willing to translate the document to other languages. Think of a table of contests and a good chapters order. Everything should be clear and logical. If the product description contains a lot of terms, it also makes sense to include a glossary.
Describe your ICO project!
Try to make a detailed description of the project, its functionality and features. How will the project help the market? What problem does it solve and why? It is important to talk about the functionality of the product. Have you made an in-depth research of the market? Do you have any numbers to share with a potential investor? Try back your words with sources and footnotes. A white paper is a serious document, which requires a precarious data. How many stages of development does a project have? Describe what stage are you currently on, what goals do you have and what preliminary data can you share with the token sale participants.
Remember that investors are mainly interested in projects that already have some data to share. Expertise and previous experience matters!
The other important chapter to include is the financial details of the project. A good project should explain the financial needs of the project; how the funds will be used and distributed. It is crucial to explain the market share, token emission, economic model of the product, etc.
Future plan on the raised funds
How do you plan to use the raised funds? Where will the raised money go. Spend as much time as you need calculating the exact amount of funds the project needs for achieving its goals. Focus on the funds needed for the development of the product. No need to explain other financial details, such as miscellaneous expenditures, etc.
Roadmap is also an important part of any project. Mention both your past experience and future plans. When did you get started? When do you plan the first product release (beta version, alpha version, release candidate)? Be as realistic as possible, because the project participants will follow the Roadmap.