Digital currencies in the cryptocurrency market also have identities like people in the real world. Any digital asset that has an identity and a roadmap is trustworthy and wise to invest in. The identity or identification card of digital currencies is called white paper, and Bitcoin, as the first digital currency, also has this feature. You might be wondering what the digital currency white paper is and what is its use in selling and increasing the price of cryptocurrencies. In response to these questions, it should be said that the white paper is an explanation of the digital currency roadmap that is published by its development team. Digital currencies that have a white paper are more reliable than other currencies that do not have this feature. In this article, we intend to explain the concept of what a digital currency white paper is.
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What is digital currency white paper?
A white paper is an informational document issued by a company or non-profit organization to promote or highlight the features of a solution, product or service that it offers or intends to offer. White paper is also used as a method to present government policies and laws and gauge public opinion. A white paper promotes a specific product, service, or method to influence current and potential customer or investor decisions. There are three main types of white papers: background papers, numbered lists, and problem/solution white papers. A white paper provides compelling and factual evidence that a particular product proposition or method is superior to solving a problem. Bitcoin was the first digital currency that had its own white paper. If you want to get familiar with this white paper, read the What is Bitcoin white paper article.
White papers are usually designed for business marketing purposes between a manufacturer and a wholesaler or between a wholesaler and a retailer. A digital currency white paper is the same, and it provides the public with the goal and plan that the development team of that asset has for the next few years. Generally, digital currencies that have this feature are more reliable, because their price future can be known to some extent. Therefore, reading the white paper of a digital currency before buying it can help the trader to hold the digital currency or buy and sell it on the fly.
What is the purpose of publishing a white paper?
White papers are sales and marketing documents used to persuade or persuade customers. A white paper is published to learn more about a particular product, service, technology, or method. White papers are usually designed for business marketing purposes between a manufacturer and a wholesaler or between a wholesaler and a retailer. A white paper can contain a detailed and in-depth introduction to a cryptocurrency or an asset. A report that is included in a white paper is usually reliable and is published through research that has been done on it. A white paper can contain charts, tables, and other methods of data visualization. A white paper can share an organization’s philosophy or present research findings relevant to an industry.
But what is really the main purpose of publishing a digital currency white paper? Why digital currencies should have a roadmap. One of the most important reasons for publishing a digital currency white paper is that it eases the trader’s mind to buy it. Because based on the evidence displayed in the white paper, the trader finds out what the condition of this asset will be like in a few months or years. The digital currency development team puts their ideas and roadmap for the project in the form of a white paper so that investors can be more sure of their investment.
For example, Ethereum digital currency, which is the second best digital currency in the world, attracted the opinion of many people with the white paper it presented. Its development team initially announced that 15.5 million Ethereum would be launched, which provided liquidity. So, the things that have been said up to this part of the white paper article on what is digital currency, White Paper has a lot of value in the field of acquiring investors.
Read more: How to mine Ethereum
What are the sections of the digital currency white paper?
White papers are different from each other, but they are very similar to articles. What are the sections of the white paper? What content with what titles goes into a cryptocurrency white paper that will keep traders happy. White papers do not have a specific format and each development team publishes a white paper based on their interests. In general, the white paper includes the following sections, which are given in this section of the white paper article, what is digital currency.
- Abstract: It is a short section that is usually less than 300 words and provides the reader with a general picture of the entire article.
- Introduction: In this section, the project is introduced to you and a general approach of the entire text is provided to the reader.
- Statement of the problem: After you are familiar with the project, the next section will explain to you what problems are going to be solved. Invariably, the newly published white paper is to solve a problem that the project is dealing with.
- Solution to solve the problem: After the audience gets acquainted with the problem, the necessary solutions to solve it are expressed.
- How to solve the problem: In order for the trader or the reader to be compelled to buy, it is better to mention the technical description of the project. This issue is of great importance for the developers of blockchain networks.
- Introduction of the developer team: At the end of the article, the identity of the group that intends to solve the problems is stated. If the people working on the project are familiar names; Many people welcome the project.
Read more: Digital currency training course
The cryptocurrency market used white papers to reassure its investors and convince them to buy. Whitepapers contain additional information about digital currency projects. The publication of white papers helps to sell more assets in the digital currency market, because it informs traders about the future price of that asset. In another way, the cryptocurrencies that have a white paper are separated from the Bitcoin category. Kat, in this article, we have tried to explain what a digital currency white paper is, so that you can get to know more about white papers and the reason for their existence.