Résumé
A whitepaper allows projects to explain their objectives and products to the public. Projects can freely choose the type of information they want to provide, but whitepapers typically include an overview of the goals, token business model, products, features, and team information. So whitepapers can be a good starting point when researching a specific project.
Introduction
A whitepaper summarizes, in a single document, important information related to a blockchain or cryptocurrency project. It's a popular way of explaining how a project works and the problems it aims to solve.
What is a whitepaper?
Generally, a whitepaper is a report or guide that informs its readers about a specific topic or issue. For example, developers can create a whitepaper about their software to inform users about what they are building and why.
In the world of blockchain, a whitepaper is a document that helps describe the main features and technical specifications of a specific cryptocurrency or blockchain project. Although many whitepapers are focused on a currency or token, they can also be based on different types of projects, such as a decentralized finance (DeFi) platform or a play-to-earn game.
A whitepaper can provide an overview of essential data in the form of statistics and diagrams. Additionally, a whitepaper could explain the project's governance structure, the people working on the project, and current and future development plans (e.g., their roadmap).
However, there is no official way to create a whitepaper. Each project creates a whitepaper that best fits its requirements. Ideally, the whitepaper should be neutral and informative to clearly illustrate the project and its objectives. Users should always be careful with whitepapers that use persuasive language and projects that promise the moon without providing enough information.
Cryptocurrency whitepapers are often considered development plans for crypto projects. This is because they provide investors with a complete overview of the project. But, unlike development plans, whitepapers are generally published before the launch of the cryptocurrency. Thus, a whitepaper is often a starting point in which a project sets out its intentions and ideas.
What information can you find in a whitepaper?
Founders create whitepapers to provide an explanation of the goal of their project. For example, the Bitcoin whitepaper says: “A purely peer-to-peer version of electronic money would allow online payments to be sent directly from one party to another without going through a financial institution. » Conversely, Ethereum's whitepaper describes its goal as follows: "Ethereum's intention is to create an alternative protocol for building decentralized applications."
Whitepapers often give an idea of the real usefulness of the crypto project. For example, it might describe how it solves a specific problem or how it can improve certain aspects of our lives.
However, it is important to be careful about making promises. It's easy to create a whitepaper. For example, the 2017 initial token offering (ICO) boom gave rise to thousands of tokens with “innovative” ideas, but most of these projects did not come to fruition. As a general rule, remember that just attaching a cryptocurrency to a use case does not mean it will be adopted and used.
So, in addition to goals and promises, whitepapers can also show how cryptocurrency will really work. For example, one of the elements it can explain is the type of consensus mechanism it uses to allow network participants to coordinate in a distributed manner.
A whitepaper could also provide in-depth insight into components of the token business model, such as token destructions, token allocations, and incentive mechanisms. Finally, a whitepaper could contain a roadmap informing users of project milestones so they know when to expect the product launch.
Whitepapers are often designed to be simple so that anyone can read them and get at least a basic idea about the cryptocurrency or blockchain project. However, a good whitepaper will also give technical explanations to confirm the feasibility of the project.
Why are whitepapers important?
Whitepapers are important for the crypto ecosystem. Even though there are no standards for creating them, whitepapers have become a framework for researching crypto projects.
It's generally a good idea to start by reading a project's whitepaper when researching a cryptocurrency. Users can rely on whitepapers to identify potential red flags or promising projects. Additionally, they allow users to monitor whether a project is meeting its original plans and objectives.
Whitepapers provide equal transparency by making key project information public to everyone. Various parties may use the whitepapers. For example, while investors can make better investment decisions using them, developers can decide whether to participate in the protocol. Likewise, a person interested in the idea can make an informed decision about whether to join a particular community after reading it.
Examples of white papers
Le whitepaper du Bitcoin
The Bitcoin whitepaper was published in 2008 by an anonymous individual or group called Satoshi Nakamoto. The Bitcoin whitepaper is titled “Bitcoin: A Peer-to-Peer Electronic Money System.”
The whitepaper describes how people could use Bitcoin as a more efficient form of money outside of the traditional banking model. It provides technical explanations of how the Bitcoin network allows users to send digital currencies across the peer-to-peer network without an intermediary. The whitepaper also explains how the Bitcoin network is protected against censorship and double-spend attacks.
Le whitepaper d'Ethereum
A young programmer named Vitalik Buterin published the Ethereum whitepaper in 2014. But even before that, Vitalik proposed the idea for the whitepaper in 2013 in a blog post, “Ethereum: The Ultimate Platform for Smart Contracts and decentralized applications”. The paper presented the idea of a Turing-Complete blockchain, which is a type of decentralized computer that can run any application given enough time and resources.
The Ethereum whitepaper explains how its purpose differs from that of Bitcoin. While Bitcoin is designed to provide peer-to-peer digital payments, the Ethereum whitepaper presented a platform that would allow developers to create and deploy all kinds of decentralized applications (DApps). This could be, for example, another cryptocurrency or a decentralized lending platform. The whitepaper also explains the technological solutions that made the design of Ethereum possible, such as smart contracts and the Ethereum Virtual Machine.
To conclude
Ideally, a whitepaper should provide you with a necessary understanding of what the cryptocurrency project plans to do and how. However, whitepapers are not regulated, and virtually anyone can write one. So, if you are interested in a certain project, it is important to carefully analyze its whitepaper, taking into account red flags and potential risks.
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