How to Write an ICO Whitepaper
In this article we will look at how to write an ICO (Initial Coin Offering) whitepaper from start to finish. After you have read the entire article, here's what you will learn:
- How to create an ICO whitepaper outline
- How to refine your business model
- How to explain the problem that you are trying to solve with your ICO, and your solution
- What technical architecture details you need to explain, and how
- Marketing 101: how to write the marketing plan section of your ICO whitepaper
- The legal section of your ICO whitepaper
- How to highlight your team members in the about section
- How to write an executive summary
But before we get started, let's make sure you have the basics all set. In order to do a successful ICO, you need to have a lot of things in place.
First, you have to understand ICOs well.
If you need to read up more on different types of ICOs, you can go here. You also need to have thought carefully about your market, the technical aspects of your offering, and most importantly, you need to have assembled a great team.
If you're still finalizing the specifics of your ICO, or if you need help, click here.
Step 1. Preparing Your ICO Whitepaper Outline
Before doing anything else, you will need an outline. You can later use this outline to create the table of contents for your whitepaper.
You may be tempted not to write an outline, but it's extremely important for you to have an outline if you're going to organize your whitepaper properly.
You also will need to ensure everything you write is as clear as possible.
If average investors can't read and understand your ICO whitepaper, you will never be able to get them to put their hard earned cash into your ICO.
So how do you do an ICO whitepaper outline? Well, the easiest way to get started is to use our ICO whitepaper outline template. You can download it from the link below:
The ICO whitepaper outline template is a simple outline that you can use to build out your own outline. Here are the major sections in the outline. You will want your ICO whitepaper to have (at a minimum) these sections:
- Executive summary
- Table of contents
- Problem (the problem that your coin offering solves)
- Solution (how your coin offering is a solution to the problem)
- Market for your coin offering
- Market size
- Business plan/model
- Market features
- Industry growth
- Marketing strategy
- How will you get attention for your coin offering?
- How will you get users to adopt the coin in your targeted industry?
- What will you do to speed up adoption?
- Are there incentives or features of your offering to promote adoption?
- Offering mechanics
- Offering schedule
- Initial exchange rates
- Maximum number of coins
- What happens to unsold tokens?
- How are coins distributed before ICO? (team, presale investors, public, etc.)
- Are there any lock periods?
- How will the invested funds be used? (dev, marketing, etc)
- Technical details
- Team and company
- Corporate information, location, jurisdiction
- Team bios
To build your own outline, start with the sections above and start filling in details under each header. Try to answer any of the questions on each line.
Again, if you want a starting point you can download our ICO whitepaper outline template.
If you can't fill out everything now, or you don't know the answers to all of the questions right now, don't worry too much. We will go through each section more in depth throughout the rest of the article.
Step 2. Refining Your Business Model
Coming up with a business model and refining it is a huge topic, and much of it is well beyond the scope of this article.
There are many things that you will want to think about when you are getting prepared to write your ICO.
We have more detailed articles on a lot of the specifics of a coin offering business model, but here are some points to keep in mind:
- Make sure that you have a compelling problem, and that your coin offering actually solves that problem.
- Make sure that you have carefully thought out all of the technical aspects of the offering mechanics, such as initial exchange rate, lock periods, etc.
- Make sure that you have planned out your use of funds. Investors may be skeptical if they see you using too much money in certain areas.
- Know what will make your coin offering spread, and what incentives will be offered to help that happen.
- Make sure that you have a strong team, with plenty of people who can vouch for your team's technical skill and ability to manage an ICO.
Check out some of our other articles on refining your coin offering business model here.
Step 3. Getting Started With Your ICO Whitepaper: The Problem
Any coin offering should solve a problem. If yours doesn't, stop right now and do something else.
If you're still here, we'll assume that your ICO is going to solve some kind of problem, and you are able to articulate that problem well.
So you're now ready to start writing your whitepaper. To get started, download our ICO whitepaper template here:
For the "problem" section of your ICO whitepaper, you will want to be able to write up to 5 pages.
What should those (up to) 5 pages include? You will want to clearly lay out what's going on in the industry that you're trying to revolutionize. Explain the current situation in the industry, and why that is not sufficient.
Begin the section with a very simple and clear (preferably one sentence) statement of the problem. Here's a great example from the Monetha ICO whitepaper:
Three significant problems that merchants face: trust and reputation, payments, and an inability to reach the growing Ethereum economy.
After this simple problem statement, the Monetha ICO whitepaper goes into specifics about each part of the statement.
Why is trust a problem for merchants? Why are payments a problem? And why is it difficult currently to reach the Ethereum economy.
Make sure to use plenty of statistics and charts/graphs.
If you can, also include some examples or anecdotal evidence to support your statistics. For example, explain how the problem has affected you, or do a case study of how the problem affected a business.
Step 4. Describe The Solution That You Are Providing
How does your coin offering solve the problem above? The next section of your ICO whitepaper should explain what your solution is, and why it is the best solution for the problem.
Make sure that you address the problem you stated in Step 3 completely.
If there are multiple problems that you have stated, rewrite each problem in one sentence, and then provide the solution underneath. The BunnyToken whitepaper (for the adult industry) does this well:
Full ownership of money
Digital currencies are independent of any third party. Transactions through the blockchain are freed from conventional and traditional rules, they are not overlooked by a government, and only the owner of the tokens has control over their money.
The payment providers who do allow accounts for adult industry related businesses and individuals charge very high fees, because competition is almost non-existent. With BunnyToken those fees are much lower making them equal and even less than they normally are in any other industry. This instantly means businesses make more profits while consumers spend less.
The infrastructure which underpins the blockchain technology carries a huge advantage for the banking sector of any industry. Through blockchain data of transactions is stored across vast networks of computers that constantly check and verify information with each other. The blockchain system is near-impenetrable even to the brightest cyber-minds.
Due to the Ethereum based blockchain platform, digital currency transactions will allow guaranteed anonymity. Anyone who is uncomfortable with a billing statement related to any form of adult content or products will remain anonymous when making purchases with BunnyToken.
A united currency
Once more and more companies join BunnyToken, the use of of BUNNY in the industry will eliminate large transaction costs, because all transactions will eventually be made through one united currency.
Helping individual performers
With BUNNY performers can control their account and receive their payments directly, securely, without large fees and with full anonymity towards the paying end.
With several succinct points, the whitepaper explains how the coin offering will solve some of the most complicated, and long-term problems in the industry.
If there are currently other players in this space, you will also need to explain how your offering is better than its competitors.
Step 5. Explaining the Technical Details of your ICO
Chances are, your coin offering will be based on Ethereum, as the majority of ICOs are. You can assume that ICO participants understand Ethereum to the extent that they need to in order to participate in the ICO. You can also assume participants have read that Ethereum whitepaper. So you don't need to rehash any of that.
What you do need to explain is what you are building on top of Ethereum. Here are some things your technical section should include:
- Is your offering ERC20 compatible?
- Will you provide your own wallet? Will you have any centralized portal for configuration and transaction information?
- Will you have an API? If so, you should attach your API specification as an appendix, but you should explain what endpoints the API provides, and what (if anything) is missing from it.
- Is the offering part of some larger software? If so, you may need to explain the technical details of that -- if it's non-trivial.
- If possible, include use cases and use case diagrams, which make it easy for someone to understand how the offering is used.
Step 6. Marketing 101 for your Coin Offering
Let's face it: most of us who are knee deep in blockchain and ICOs are geeks -- and we need help marketing.
This section will be a short primer on marking for startups -- from identifying and segmenting your market, to defining your business model, to building your marketing plan.
Identifying the Market for your Coin Offering
Hopefully, you've done this before designing your coin.
But regardless of whether you've done this already, you will soon have to explain the market to your investors. That means you have to include a section in your ICO whitepaper about your market.
How do you start? Research. Go to marketing sites like eMarketer, and learn everything there is to know about your market.
Once you have done that, take the most salient statistics and figures to use in your whitepaper. Make sure to include these:
- Market size in people/users/etc. as well as in dollars
- Market growth over the past few years and projections for future growth
- The market potential (in dollars worth of transactions) for your coin offering
Once you have written a section of your ICO whitepaper on the market, you will need to explain how you make money in the market. That's your business model.
Your business model should explain how your business makes money from the coin offering.
Specifically, you should answer the following questions: Are you charging a fee per transaction? How much is it? If you're not charging a fee, how will you fund maintenance of your platform?
How will you get word of your ICO out? How will you get people to buy in? That's what you need a marketing strategy for. Here are some of the things you will want to include in your marketing strategy:
How will you get your first investors?
What marketing channels will you use to get initial investors? You will need to get your message spread as wide as possible, otherwise your ICO will be a bust. Some of the ways to do that include:
- List your ICO on ICO directories online. You can find them easily on Google.
- Contact as many ICO review sites as possible. Try to get them to review your offering close to the date of the ICO (or the pre-sale to generate buzz).
- Leverage social media: get as many social influencers as possible talking about your offering, and make sure you are coordinating your social media effectively.
- Create as much SEO content as possible, so people searching for ICOs can find you online.
- Make an explainer video. ICOs are complicated, and you need to be able to explain how your ICO will change the world. You can get an excellent one done cheap from this Fiverr seller.
- Create a referral program, and loyalty incentives (see next section).
Referral and Loyalty Programs
Although it's not necessary, nearly all new ICOs have some sort of referral program or loyalty program. The intent of these programs is to incentivize people to learn about your offering, and to keep those who use your offering loyal.
A referral program is an excellent way to get new people to buy into your ICO. How you structure the program will have a significant bearing on how helpful it is.
You can offer very little, but then there isn't a good case for people to refer your ICO. If you offer more, it will have an impact on how much of the offering you can hold for yourself.
The simplest program of this type would be a referral link that only works at the ICO, where people who refer other investors will get a set percentage of their buy in.
You will have to reserve part of the initial distribution for this purpose.
More complicated programs can help you spread adoption over time, thereby increasing value. One option is to set aside a bounty, out of which will each person with coins in their wallet will be paid at some interval (or once).
You can also provide some sort of cashback bonus, which is paid for through part of your transaction fee.
That bonus will be provided at certain intervals based on how how many transactions the recipient completed, or the size of their transactions.
Step 7. The Legal Disclaimer
Although ICOs are nowhere near as heavily regulated as other financial instruments, more and more countries are putting regulations on them.
But even if your country has no regulations on ICOs or cryptocurrencies, you will still need to consult an attorney who can provide you with a legal disclaimer.
This is extremely important, as there are a lot of possible liability issues you can face in doing an ICO. Do you need an ICO lawyer? There are plenty of excellent lawyers who have done this before on Upwork.
Step 8. The Team Section of your ICO Whitepaper
One of the most important things in your ICO whitepaper is your about (team) section. You should have a team of at least three main people, plus a group of advisors.
Make sure you have at least one technical person, who has a strong background. If you don't have someone already, try to find someone who has significant experience with cryptocurrencies.
It helps if they also have a history at top companies or schools.
The other people can be tech or business people. It's nice to have at least one person who can do marketing -- that can be your CEO/director, or a separate person.
For each of the principal team members, your ICO whitepaper should have 2 paragraphs. The first describes what the person will be doing on the team, and the second describes the person's background and experience.
For the advisors, you can write one short paragraph each, including their current positions and previous work.
Step 9. Finishing Up With an Executive Summary
The final step in writing your ICO whitepaper is doing an executive summary. The executive summary should be one page, and it should follow this format:
- 1 paragraph about the problem that your coin offering will solve
- 1 paragraph about how your offering solves that problem
- 1 paragraph about the market for your coin (size and market dynamics)
- 1 paragraph about the details of the ICO -- offering size, initial exchange rates, schedule
- If there's something you want to highlight about your team or your technical architecture, you can add that as well
Step 10. Start Marketing...
You're now done with the whitepaper. Remember you can download templates from here.
The next step is doing some marketing, which is one of the most important parts of doing an ICO. How do you do the marketing? What tips and tricks are there? What are ways to get people to learn more about your ICO? Check out our Marketing Your ICO article here.