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When is a Whitepaper not a Whitepaper?

September 22, 2017

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Throughout my writing career, the terminology “whitepaper” has been distorted time and again, but the ICO market has dealt the final blow. What is a whitepaper anyway?

Over my years in technology, formally a whitepaper is a technology positioning paper. Often, companies would come to me wanting to write a “white paper” but what they really wanted was a product description or brochure without fancy design. So, apparently the “white” part means you don’t need to spend any money on design. Satoshi Nakamoto definitely didn’t. On the other hand, Nakomoto didn’t use any paper either.

Strictly speaking, a whitepaper presents a problem and then describes why today’s technological solutions are not up to snuff, and then proposes a better solution.The Bitcoin Whitepaper by Satoshi Nakamoto is a clear example of what the industry has always called a whitepaper. It’s an extremely unlikely way for a new form of international finance to come into existence. The whitepaper is only 9 pages long, including an abstract and references. You can’t get away with that kind of ICO whitepaper today.

In fact, today an ICO whitepaper is more like a business plan or prospectus. Of course, we don’t want to call it a prospectus or business plan, because of the regulatory issues around those names. Despite the misnomer, though, your ICO whitepaper isn’t just the foundation of your ICO. It’s the foundation of your business. You need to discuss the problem and solution, of course, but you also need to provide market value, describe the users of the token or coin, and describe competition and business models. Most importantly, we are told, we need a reliable team.

The better and more comprehensive your ICO whitepaper is, the greater your chances of success, not just for raising the initial funds, but for having your venture succeed. Because it’s more like a business plan, going through the exercise of creating a comprehensive white paper means that you and your team have considered a wide range of factors that affect your group. I recently read a 50-page whitepaper for a reliable news network, and you can tell these guys understand deeply their business. The white paper even includes open questions, so when you go onto their Slack, you can see discussion of the open issues, and the creation of a community pre-ICO.

A good ICO Whitepaper helps you and your team think through all the areas around your token or coin. Just like a good business plan, it should include the problem you are solving, your target audience, the business model, competition, marketing, the team and the technology. In some ways, the technological implementation is the least important today.  While investors need to see that you have worked out the technology, the real value of ICOs today is in the business model and in the contribution to the cryptocurrency ecosystem as a whole. That’s why today, for most ICOs, a 10-page white paper is insufficient.

What do you think? What are the crucial elements of an ICO Whitepaper today? What is the ideal length? And does it have to be white? Let us know in the comments below!