Scrap the White Paper: How to Evaluate Tokens and Blockchains

If you have spent any time in the cryptocurrency sector, or looking into initial coin offerings (ICOs), you know that the process revolves around “the white paper.”

This is a document that lays out facts about the blockchain, protocol, or distributed application (dapp) that is being built, and describes how the tokens will work. Sometimes it is a deeply technical document. Other times it is mostly marketing.

I think it is mostly irrelevant.

Crypto investors love white papers, although I’m not sure they really read them. Mostly they skim them and ask “why can’t you do this with a database instead of a blockchain?”

It’s a valid question. Of course, it’s also a valid question why you even need a database. You could use a spreadsheet instead, or even a comma delimited file. Or you could chisel your ledger on stone tablets too.

Asking the right questions

Most crypto investors don’t ask good questions. In fact, most crypto forums are filled with posts of people asking the same thing over and over or issuing the same three or four criticisms of blockchains that they read somewhere else.

But blockchains, and the general concept of decentralized systems, unlock a lot of new, cool possibilities. And the way to understand those isn’t to evaluate the technical merits of a blockchain via the white paper. It’s like evaluating Amazon’s e-commerce capabilities based on its low-level server infrastructure design…

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