A whitepaper is a document that project founders or developers write to explain their project’s purpose and technology. Whitepapers are often colorful, technical, and detailed because the project founders or developers know that it is a way of exciting and, more importantly, attracting potential investors.
When you visit the website of a blockchain project, you are likely to see a link where you can download the project’s whitepaper. Most blockchain projects take whitepapers seriously because it is the best way for project founders and developers to share their ideas with potential investors.
Reading a white paper is the best way to understand what a project is all about. Never invest in blockchain projects that you have not adequately analyzed their whitepapers. Whitepapers contain various data, statistics, and diagrams that you can read to ensure the project is worth investing in.
The whitepaper for the first blockchain project was the Bitcoin whitepaper which was titled “Bitcoin: A Peer-to-Peer Electronic Cash System,” which was published in 2008 by Satoshi Nakamoto.
Reading a whitepaper is easier if you follow a few steps
The development around the blockchain ecosystem has been tremendous since then; most projects ensure that they publish a whitepaper that analyzes how their blockchain protocol will work. Reading a whitepaper might be a stressful venture for someone who is not tech-oriented. Reading a whitepaper might be easier if you follow a few steps.
First, you must understand some standard blockchain terms, including consensus mechanism, Blockchain, Smart contract, etc. You can read several guides on the Fuse Academy to understand those concepts properly.
The next step is to determine the project’s utility. For example, if the project is about tracking supply chains, ask yourself if they have the resources to achieve their aim. Another thing you must try to understand is if the problem the project is trying to solve exists.
Token distribution is one of the things that are important to analyze when you want to invest in a project. What percentage of the project goes to the implementation of the project? Is 90% going to the project founders? Why is only 10% going into implementation? You also need to read the project’s timeline to know when they plan to achieve the set-out goals in the whitepaper.
Research the project founders, check their social media accounts, and confirm if they have a good record.
A good project requires a whitepaper; that is why Fuse Network has designed our whitepaper that fully describes our decentralized EVM-compatible blockchain powered by the Fuse platform and ecosystem. Fuse Network is a robust plug-and-play mobile responsive system that supports crypto payments, Decentralized Finance (DeFi), and NFT projects. Read our Whitepaper here.