How to Write a White Paper for Your Blockchain Project — A Complete Guide
By Daniel Ongera Nyairo on ALTCOIN MAGAZINE
This is a detailed step-by-step guide on writing a white paper for an initial coin offering (ICO), Initial Exchange Offering (IEO), a blockchain project, or, in fact, any other reasons. An analysis of some of the successful white papers is included, with particular attention paid to their styles, structures, and outlines.
I also provide and explain a few white paper templates.
I write this guide as someone who has worked on several white papers and as a blockchain niche writer who has had to read at least several white papers every month.
So, I know something about writing a white paper. A lot, I think :).
What is a white paper?
First things first. What is a white paper?
A white paper is a document that provides information on a given topic, issue, or product. It can also propose, introduce, explain, or justify a technological innovation to a target audience.
Its origin is in politics, however. The term white paper was first used to describe a document elaborating on a legislative question, position, or process in the United Kingdom in the early 20th century.
Over the years, it was adopted for business and particularly for marketing.
Of particular interest to us, however, is its use as a marketing and communication tool for initial coin offerings (ICOs), decentralized applications, and other blockchain-related projects.
We see it as a document conveying information about a new blockchain theory, architecture, design, or process.
It is important to clarify that not all white papers are about raising capital, even within the crypto space. Many are used to pass information to the community of users or enthusiasts. Indeed, the first-ever use of a white paper in the crypto space was to announce and inform.
The birth of the blockchain revolution was announced to the world through the Bitcoin white paper that Satoshi Nakamoto published in October 2008 on a cryptography mailing list.
This started a tradition within the blockchain space of using a white paper to announce new concepts, theories, and applications. This has also made writing white papers a very valuable skill.
Even when a white paper is not for fundraising, it must be written well because that determines whether your message is received.
What is the difference between a white paper and other forms of content?
Why should you consider writing a white paper, not a blog post or a press release?
While a white paper is a marketing tool, it copies the tone and style of an academic or journal article. It gives your message a formal appearance and feel, which is important, especially when you are not trying to bypass the reader's logic or pull their heartstrings — even though you still do that. You show respect to a reader who takes their logical approach to issues much more seriously.
Also, even though it is part of a sales funnel, it is more educational than promotional. It is supposed to inject your ideas into a serious conversation about a particular topic.
Functions of a white paper
In essence, a white paper does these three things:
- It introduces a new idea, concept, or solution.
- It explains the new idea, concept, or solution in detail,
- It justifies the new idea, concept, or solution.
The white paper should let the reader, at the earliest possible, have a general picture of the idea, concept, or solution. It should also let the reader know what the introduced concept disrupts or changes.
Then, the white paper should take the reader under the hood and explain how the new concept works and the processes involved. It should break down and explain all the parts that make the whole and how they all interface.
Justifying a new idea, concept, or solution is probably the most important function of a white paper. In the case of blockchain-related projects, it often justifies and explains the reasons for the solution you are building and the token you are issuing.
Indeed, the most effective white papers adequately justify why their project exists and the coin they are issuing to raise funds. More importantly, it justifies the benefits those who buy into the project stand to get.
Sadly, most of the white papers published fail to justify either the project or the token they seek to sell or airdrop. That makes one conclude that backers have little chance of recouping their investment. Any investor who gets that impression will not buy or accept a project's coin.
A white paper also does a great job of justifying and explaining why the team behind the project is the most suited to work on it. There is an old entrepreneurial adage that people buy you, not your products. Meaning they buy your product because they are confident about your competence.
There is nowhere this is truer than with blockchain projects. Many investors buy a token or put money into a project simply because they either see a name they recognize in the team or are convinced that the team can deliver the project.
A white paper provides an opportunity to showcase the capacity and ability of the team behind a project. And it does this through detailed bios of the critical members of the team. It also does it through the impression the document creates. A comprehensive, thorough, realistic, and clear explanation makes the readers believe that the people behind the project know what they are doing.
The point is that a white paper is a document to justify things. It helps a target audience understand an issue, concept, or project to make the right decisions.
White paper writing steps;
Step 1: Identify your primary target reader
Before you start writing a white paper for your project, you must have it clear who you want or expect to read it. Talk to as many people involved with the project as possible to identify that person.
- Is it an ordinary person on the street?
- Is it a professional crypto investor?
- Is it a developer who might want to use the technology to design other solutions?
- Is it a business executive who might influence their company to buy the technology you are building?
- Or are there several categories of target readers?
Once you decide whom you are targeting with your white paper, you should build a detailed profile of them. The points to guide you when doing this include;
- Their age bracket
- Their likely gender
- Their occupation
- Where they live
- Hobbies and interests
- Problems and concerns they face and need solving
- Their level of education
- Their level of understanding of the technology you are explaining in the white paper
Understanding your target reader using these points is helpful in terms of matching your offer with their needs and explaining concepts at the level of their comprehension. For example, using industry-specific technical terms will be in order if you target developers and crypto experts.
However, if your target reader is a person on the street who needs more technical understanding, you should appropriately tailor the paper so they will understand it.
It also happens that often, the solution you describe in your paper is a B2B, and therefore, you have businesses and enterprises in mind as the target. It would be best if you still created a profile of your target enterprises. Consider things like their size, the industry where they operate, and their market.
But still, even when your document is targeted at a company, institution, or business, it will be read by a natural person. You have to identify that natural person. Ideally, you need to target the person likely to influence the institution's decision.
White paper localization
It is very easy to target a single type of reader. Unfortunately, when you write a white paper, you target more than one reader profile. You might be targeting investors you need to back your project and, at the same time, developers and businesses you hope will use your technology.
It is also true that most blockchain projects are global. They target audiences across international borders, creating a challenge when targeting readership.
You expect people of different cultures, local realities, and even languages to read your white paper. This, however, doesn't mean you should throw your hands in the air and give up. You have recourse. You do what is called white paper localization.
White paper localization, in part, has to do with translating it to various languages according to the demographics you are targeting. The translations need to be beyond linguistic. It should include using local analogies, examples, and social norms to resonate with the targeted reader.
The localization also includes writing different versions in the same language targeted to varying categories of readers. You can have a non-technical copy for ordinary investors and backers, where you explain the project with more emphasis on how the backers stand to benefit if they put in their money. And you do this in a way they understand the concepts involved without having to know how the technology works behind the scenes.
You can have another version targeted at developers where you explain the technical aspects and everything under the hood. You explain how they can use the solution you offer for their projects. This version can be as technical as a developer must make the right decisions to be part of the project.
Most white papers published within the crypto space look and feel like marketing brochures or journal papers. The former are usually targeted at the less technical audience, and the latter is often aimed at fellow experts with an equal capacity to understand technical concepts.
White papers in the crypto space also fall between simple marketing brochures and being peer-reviewed like scientific papers. Examples of the latter are white papers by Input Output Hong Kong (IOHK), a startup behind the Cardano (ADA) project, peer-reviewed by experts worldwide.
In essence, white paper localization is achieved by translating to various languages and writing different versions for different target groups.
Step 2: Identify the goal you want the white paper to achieve
Having a white paper without a clear goal is like not having a white paper at all. Your white paper must have specific, measurable, achievable, relevant, and time-bound (SMART) goals.
Some of the things you might want to achieve through a white paper include:
1. Raising funds
Selling tokens to raise funds turns out to be the goal for the majority of blockchain-related white papers. If yours falls into this category, you should write it, knowing that the target reader has priorities of where to put their money, and your project is far from the top of the list.
Your work is to take your project to at least near the top of this list of priorities. You must invest high enough for your reader to consider your project. This is not easy, and success depends on your ability to express the project's potential and, most importantly, how the reader stands to recoup their money.
Of course, your goal should include how much you intend to raise, by what time, and even from what number of investors.
2. Creating awareness
Many white papers are written to inform and educate readers. Some are written to announce the existence of a project or its launch.
An example of a white paper written for this goal is the Lightning Network white paper developed by Joseph Poon and Thaddeus Dryja in January 2016. It was a document meant to introduce to the crypto community a new way to scale blockchains.
Bitcoin and Litecoin have since adopted Lightning Network. Others like Ethereum and ZCash have been inspired by it to design similar scaling solutions, Raiden and BOLT.
The Bitcoin white paper was arguably written for this function. Satoshi Nakamoto wrote it primarily to announce and create awareness about the new invention.
3. To sell a product or service
Yes, you may write a white paper that aims to sell a product or service. The main message in this kind of white paper is mostly the description of the problem your readers are experiencing, the features and the benefits of the product you are selling, and how it alleviates their pain.
A white paper written for this goal is hugely very subjective. But even then, you should try to avoid it being overly promotional.
An example of a white paper written to sell or introduce a market product is one by Sirin Labs. The white paper describes and explains how Solarin, a blockchain-enabled smartphone, works and what it offers users.
Step 3: Identify who is going to write the white paper
It would be best to think about who will write the white paper. The ideal situation is that those designing the solution are the ones to draft the document, and then an expert writer helps with making it presentable.
That means if it is a protocol, the designer, engineer, or developer should create the first draft. It is even better if it is jointly written by the team behind the project and not individually.
Writing by the people who identified the problem and are designing the solution gives the white paper nuances that are easily missed if someone else is writing it.
However, it turns out that designers, engineers, and developers are often too busy to find time for writing a white paper. They must get attention from their core functions and learn how to write a white paper, a situation not ideal.
Development teams are often forced to delegate tasks to the marketing team or even outsiders.
While these two options can work and even produce a compelling white paper, the process must be outlined, and the writing monitored closely by someone from the inside. If the person writing the white paper is not part of the technical team developing the product, they must get a lot of guidance from someone who is.
They should even be allowed to attend the meetings of the technical team. And most importantly, they should be encouraged to ask questions, however basic and straightforward, during these meetings. The team should also be asked to be accommodative of the writer. It is very easy to get frustrated when someone in your sessions asks questions that have self-evident answers.
The writer should also have access to at least one technician, developer, or engineer, whom they ask clarification questions every time they are stuck.
Apart from getting better results and precisely the time of white paper you need, the other reason why it is a better idea to have the internal team write the white paper is that hiring the best white paper writer from the outside is costly. Having a good writer work on your white paper costs anything from US$1000 to US$5000.
You also do not have to invite someone into the team and have them sit through while picking information not meant for outsiders.
The middle ground between writing the white paper yourself and hiring an expert to do it is to do the first draft yourself and then get the expert to handle edits and structuring. This option allows you to provide the right nuances to the white paper while at the same time tapping into expert copywriting services from outside.
This way, you also have the opportunity to decide what information reaches the writer or the editor.
It also cuts the cost of production down, as what you will pay is far from what you would have paid if you had the entire document drafted by an outsider.
Whether you are hiring an editor or a writer to work on the white paper, make sure your briefs are detailed and precise enough. Often, a writer will produce excellent content, but it differs from what you have in mind. That leads to disappointments. Put everything in your mind on your brief and ensure expectations are well-defined.
Step 4. Identify the structure of your white paper
Before you start working on your white paper, or at least after the first draft is done, it is important to decide the overall structure or format it should have. How you arrange your ideas and have them follow one another impacts how readers comprehend the document.
A good structure emphasizes the right points at the right junctures.
The white templates we explore below are built on copywriting strategies tested and proven to work with other forms of content. It is possible to write a white paper with little knowledge about these templates but still have it flow in one or the other. However, knowing about them and consciously trying to apply one that fits your content best will improve the effectiveness of your white paper.
The most common white paper templates that one can see through published white papers are Before — After –Bridge, Problem — Agitate –Solve, Features — Advantages — Benefits and Attention — Interest — Desire — Action (AIDA).
We explore each of these in detail below. We also look at examples of white papers that use each.
1. Before — After — Bridge
This a perfect white paper template when presenting a solution to a problem that a reader has probably never thought about. Most businesses exist because they are good at convincing their clientele that a problem exists and offering a solution.
It is, therefore, important to figure out as you write your white paper whether the problem you are trying to solve is one your target reader recognizes at the mere mention. Or it is one they likely need you to make them aware of because they have never recognized it.
If it is the latter case, then your presentation should be in the Before—After—Bridge format, and here is what these stand for;
Before — This will be the first section of your white paper. In it, you describe the reader's world as it is now. Provide as much detail as possible to create a gap where your solution will fit or foreground a lack that must be fixed for that world to be perfect.
After –In this section, you will paint a world where the problem you foregrounded and highlighted in the first section is solved. It brings the readers to imagine that world and how better it is than what they know.
Bridge — This is the last section, where you describe your solution as what makes the new, better world possible. Describe the solution's design, protocol, and implementation process concerning the reader's ability to comprehend the technical aspects. In essence, in this section, you present your solution as the bridge between the current world and the possible better world.
An example of a white paper that uses this template is the one introducing the Bancor project.
Interestingly and indicatively, the paper begins with this sentence; "We live in a world where anyone can publish an article, song or video, create a discussion group and even run an online marketplace." It starts by describing the world the reader already knows.
Through the introduction, the Bancor paper makes the reader aware of the problem of exchanging digital tokens created on the blockchain.
At the time of its publishing, many people could not think of exchanging one ICO token for another as a problem. Many were still excited at how it was even possible to have digital tokens that were not centrally controlled. But after reading the first part of the white paper, they see a huge gap that needs to be filled.
In the second section, the Bancor paper describes a possible reality. It describes ERC 20 smart tokens that discover their market prices and provide liquidity for buying and selling. In this section, the team basically showcases the technology that can be used to solve the problem identified in the first section.
While the Bancor protocol is mentioned in the first two sections, it is only in the last part that it is described in detail. It is also in the third section, where it is sold as a product to the reader.
Bancor raised US$153 million using this white paper.
I invite you to read the Bancor White paper here.
2. Problem — Agitate — Solve
This is a standard white paper template, especially for content written for marketing purposes. It is useful because it not only first creates a clear picture of the problem for the reader, but it also, to some extent, scares them into embracing the solution. And as we know, fear is a powerful feeling. None beats it at making people take a step.
When it is done well, it makes readers more than prepared for the solution. They end up hoping for it.
Let's break down the three sections.
Identify a problem — In this section, which often carries the subhead of 'introduction,' you describe the problem to the reader in clear terms and with as little ambiguity as possible. While the section could be several pages, the reader should have an overview of the problem in the first paragraphs.
Agitate the problem — In this section, the reader sees the ugliest part of the problem. The worst-case scenario is presented with the reader ideally made to be the one at risk. Examples show how it negatively affects businesses, lives, or processes. Numbers, graphs, and statistics show how bad or ugly things can get.
Solve the problem — This section introduces the solution to the problem. In this section, your project or company becomes the hero that saved the day. This is usually the most significant section for many projects that use the Problem-Agitate-Solve white paper template.
An example of a white paper written using this template is the Status project white paper. The paper helped raise US$108 million.
The Status white paper has an introduction explaining the general problems social networking site users face. It describes things like bots twisting narratives and discussions on Twitter.
In the second section, the paper breaks down the roles of the three stakeholders in the legacy social networks. The end goal is to show how the user is the biggest loser with their data being bought and sold without explicit consent.
In the third section, the paper introduces the solution to the social network users being vulnerable and just products. It explains how status plans to make end users stakeholders instead.
3. Features — Advantages — Benefits (FAB)
This is another white paper template you can use. It focuses more on the solution you present to the reader or the target customer. This is best suited when the solution you are presenting is meant for an almost obvious problem to the reader.
Features — The first section of the white paper will break down and describe the features of your solution. For example, if you are introducing a new blockchain, you will describe the mining or consensus process, the network architecture, and the wallet design.
Advantages — In this section, you will describe what gives the solution a better chance of succeeding. Still, on your new blockchain, you can describe the capacity of the team behind it as well as the resilience of the technology you are using.
Benefits — This is the most critical part because it is what will sell your solution. People are always interested in how something makes their lives better. Describing benefits is about showing people how the solution will improve the quality of their lives or business.
Still, with the new blockchain example, you can show how their transaction will be confirmed faster, and they will not have to wait, or they will be able to convert from one coin to another with little friction or cost.
A project that used this white paper template is the Filecoin project.
In the first section, the paper details the features of the distributed cloud storage platform. Right from the introduction, we are introduced to the components of the projects: decentralized storage network (DSN), novel proof of storage, verifiable markets, and useful proof of work.
It then explains in detail how each component gives the platform an edge over what we already have in the market.
In the final sections of the paper, there is a description and enumeration of what stakeholders stand to gain from the protocol.
The Filecoin project raised US$257 million with the help of this white paper. I invite you to read the white paper here.
The tagline
Google defines a tagline as 'a catchphrase or slogan, especially as used in advertising, or the punchline of a joke.' It is important to have one for your white paper. It should be the second thing to come on the paper after the name of your project.
While the tagline should have rhymes and rhythm to sound pleasant to the ear when read out, the most important component is to say what the project is about in the fewest words possible. By just reading your tagline, a reader should get a clear idea of the project and what you are trying to achieve.
Indeed, the tagline makes a promise, and the reader will read the white paper expecting to see its delivery.
Bancor chose 'Continuous Liquidity for Cryptographic Tokens through their Smart Contracts.'
For Tezos, it is 'a self-amending crypto-ledger.'
Meanwhile, Sirin Labs' reads, 'secure open-source consumer electronics for the blockchain era.'
In all these examples, the idea in the white paper is compressed into a single line. While it is the first line on the white paper, it is better to write it last after the document is ready. But you can have a draft of it, which will act as a guiding pillar as you write the white paper. Then, it is refined at the end of writing the document.
Executive Summary, Overview, Abstract
These three mean almost the same thing, but coming across a white paper with an abstract and an executive summary is common. However, a look through the most successful white papers shows that only one is often used.
The difference could be deduced from the spectrum between the most formal and least formal. The abstract is the most formal as it is used in scientific writing, and the Overview is the least in brochure-like white papers.
One of these informs your use of whether your white paper is very technical or least technical — for marketing purposes hugely. It also depends on the target reader. If you target the person on the street as the primary reader, then an overview is a better choice.
Using an executive summary could be a good idea if you are targeting entrepreneurs as your primary reader. If you target engineers, academicians, or developers as primary readers you want to expose your innovation, then abstract is more suitable.
While the summary, Overview, or Abstract section is meant to provide the short form of the white paper, it should only cover the solution you are providing, its features, and its benefits.
While mentioning the problem sounds like a good idea, looking at the white papers that have successfully achieved their goals shows a trend of concentrating on the features and benefits.
Mathematical Formulas, computations, and graphs
Using mathematical calculations to show how your solutions work or its process gives your paper a lot of credibility. It is optional, though, that you have those, especially if the primary target readership is an investor or the person on the street.
And even when you are writing a technical white paper, the hypothesis and computations shouldn't seem forced to give your paper a look. They should serve a critical function in disseminating information.
In short, use graphics and equations to help pass your message, not just because you have seen them in other papers.
A legal disclaimer
It is important, especially if you are seeking funding to support your project, to include a legal disclaimer advising investors on some of your obligations and responsibilities and those they have.
An attorney should draft this part, or it should be at least Okayed by one. This part is meant to protect you from legal litigation if the investors lose money because of poor judgment on your project.
Conclusion
Have the white paper proofread by a professional editor. This will help catch grammatical and factual errors.
The last thing I want you to do is to recognize that the power of the rules and rules of thumb in this post is knowing how and when to break them. Know the rules, then break them creatively.
