What Does A White Paper Mean For An ICO And How To Write It? Part 2
Following on from yesterday’s What Does A White Paper Mean For An ICO And How To Write It? Part 1, here is the second and final part, enjoy!
- Describing the Project
Now, let’s talk in detail, what the main party of an ICO white paper should consist of.
When getting acquainted with a project, a potential investor can ask several questions:
A potential investor may ask if there’s a real use case for this project and which problems this project will solve. They may also ask what the competitors have to offer or whether blockchain technology is the only solution to implement this project.
Be prepared to answer the questions about the sequence of actions that will lead to the implementation of the project. Dwell upon which aspect of project implementation may cause delays, give details on why it can happen and how it can be solved.
Investors can ask questions about how the funds will be distributed among the nodes in the P2P network.
The questions regarding the number of tokens released, how many tokens the team keeps and whether the use of tokens is balanced. You should also be prepared to answer questions about the timeline, when the tokens will be released and whether they will have value.
- Regarding the executive team
Lastly, investors may ask several questions about who will be responsible for the execution of the project and whether there are advisors involved to assure the quality and the delivery of the result. Potential investors may also require the employment history and proof of the experience of working in the relevant field when examining the executive team.
Important to remember: When covering it in your ICO white paper, keep in mind that this part should be as precise as possible. Thus, fact-checking and proofreading is a must.
To make sure that this part, as well as the whole white paper is accurate, you can use online proofreading tools like Grammarly (automated online tool to check grammar, spelling, and style), TopWritersReview (a hub of professional writers, who specialize in various topics, including cryptocurrency and blockchain) or Hemingway App (checks readability and clarity of your text).
Why do you need all these questions?
It is important to take all of them into account when writing an ICO white paper. The more details you give, the more facts they will have to make an informed decision.
- Writing Disclaimers
Disclaimers are an important part of writing an ICO white paper. They are placed at the beginning of the paper and provide legal information for the investors.
A good example of ICO white paper disclaimers is the one by Quoine. At the beginning of the white paper, they place disclaimers regarding:
- the limitations of the purchases – this part includes limitations that deal with citizenship or lack of experience working with cryptocurrencies and blockchain technology.
- the risks, associated with purchases – Quoine warns all the investors that any related purchase carries significant risks, describing them one by one.
- the limitations, imposed by the laws
Since an ICO white paper can be considered a guide to cryptocurrency purchase and exchange, it should contain legal details as well. No assumptions, unverified claims or guesses are allowed.
Writing a good ICO white paper, however, doesn’t guarantee that your project will raise funds. Vague application model, weak executing team or unclear pattern of execution only add to the number of risks that ICO already has.
However, a well-written ICO white paper is necessary to keep the potential investors informed, and it also shows your expertise in the area. The examples of Ethereum and Quione show that a well-written ICO white paper can help raise funds substantially (Ethereum raised $15.5 million, and Quione raised $105 million).
Thus, creating an ICO white paper in the form of the guide, outlining all important details and answering as many questions, as possible, will raise the chances of your project getting funds.