A step-by-step guide to understanding a crypto whitepaper

cnbctv18.com:

The growth and development of blockchain technology and decentralised finance have seen a massive boom in the last two or three years. Today, there seems to be a new blockchain project emerging every day.

And every time there is a new blockchain or cryptocurrency in the market, you hear the term ‘whitepaper’ thrown around a lot. But what is a whitepaper? And what can it tell us about the upcoming project?Here we will learn what a crypto whitepaper is and how to make sense of one.What is a whitepaper?A whitepaper is a document released by developers that explains the technology and purpose of the project they are working on.

It tells prospective investors how the cryptocurrency was conceived and highlights its purpose.A crypto whitepaper contains various forms of data like statistics, diagrams, and formulas. The goal of this data is to convince prospective investors to invest in that cryptocurrency.

For any crypto start-up, releasing a whitepaper is a way to be considered professional and legitimate. It helps investors understand how the project is different from other projects in the crypto space.Also Read | Ethereum-based AR metaverse OVR moves to Polygon to tackle scalingOne of the most famous whitepapers, considered the gold standard for crypto whitepapers, was ‘Bitcoin: A Peer-to-Peer Electronic Cash System’, published by Satoshi Nakamoto in 2008.What concepts do you need to know to understand a crypto whitepaper?Reading a whitepaper may be the best way to understand a crypto project you are interested in.

But many people are confused about how to go about it, as whitepapers do not make for light reading, especially if you aren't very tech-savvy. The good news is you do not need to have a background in computer