Would You Buy a Gold Biscuit without looking at its credibility? Or purchase an ai product without checking if it can actually roll out good content or graphic or even code? No, right? So doing research before investing into crypto is also as important as researching for new assets or products. But more often people get confused about how to check for a cryptocurrency’s credibility. You look at what people are saying about the coin and probably get catfished. Yes, that happens for new investors.
So how can you ensure you do not end up making the same mistake. Well, read & assess the crypto’s whitepaper and technical papers to learn if the project is truly potential or not. In this article I will outline how to read a crypto paper. Whether you have a technical background or not anyone will be able to understand a crypto paper after reading this article.
What is a Crypto Whitepaper?
A whitepaper is a detailed document published by a crypto project that explains its purpose, technology, tokenomics, and roadmap. It’s essentially the project’s pitch deck, business plan, and technical manual all rolled into one. The whitepaper is intended to educate potential investors, users, and stakeholders about how the project works, its unique features, and how it plans to succeed in the competitive crypto space.
The whitepaper is crucial for establishing legitimacy and trust, helping investors make informed decisions and providing transparency about the project’s goals and execution plan. It is often the first official document released by a crypto startup, especially during initial coin offerings (ICOs).
Key components typically included in a crypto whitepaper are:
- Project overview: Background, objectives, and the problem the project addresses.
- Technical details: Architecture, consensus mechanism, and how the blockchain or protocol functions.
- Tokenomics: Information about the cryptocurrency token, its distribution, incentives, and economic model.
- Roadmap: Development timeline and future milestones.
- Team information: Details about the founders and developers.
- Market analysis and competitive positioning: how competitve is the market?
- Risk and legal considerations: Is the token aligned for a certain country’s regulatory status and policy.
What Does A Good Crypto Whitepaper Include?
Introduction & Problem Statement: Check for the problems that a particular token can solve. Is it a real world issue and does really require a token on blockchain at all? If the token does help in solving the problem how decentralized is the infrastructure and does the journey of the the crypto in the entire project makes any sense or is it just a way to print more money? A credible whitepaper clearly articulates a real-world issue and why blockchain is a suitable solution. Ask yourself: Is this a genuine problem? Does it require a blockchain-based solution?
How To check? At times crypto whitepapers may not have a dedicated passage for the problem statement. Simply use a keyboard shortcut control +F and type problem. Usually, some papers sprinkle the problems and its proposed solution throughout the paper to help the reader understand the infrastructure in a better way.
Source: Ethena Fi
Proposed Solution: Evaluate how the project plans to solve the problem. Look at the innovative/ technical solution that the project proposes. Does the solution looks like it works? To understand that you must look at the technical words used and how that is explained. If the project does not explain the technical bits at all, then it is a red flag. At times you may even come across whitepapers that are math heavy and might seem overwhelming. So does that mean that the whitepaper is a piece of flowery technical content? Not necessarily. If we look at Bitcoin’s whitepaper it is truly confusing with all the arithmetic and code stuff. I that case as a researcher you can use gemini or perplexity to simplify it for you and ask if all of this content is true and does it work? Is there even an MVP? Check for these things!
Technical Architecture: Review the technical details, including blockchain structure, consensus mechanisms, and smart contract functionalities. Even if you’re not a technical expert, the whitepaper should explain these concepts in accessible language. If the document is overly technical without clear explanations, that can be a red flag.
Crypto Tokenomics: Understand the utility and distribution of the project’s token. The whitepaper should explain the token’s role (e.g., governance, transaction fees, incentives), how tokens are allocated, and any mechanisms for scarcity or inflation.
Crypto Project’s Team & Roadmap: Check the social media profiles of team/ founders on LinkedIn, X (Twitter) their past projects, and overall industry credibility. Is there a timeline with achievable milestones? Avoid projects with vague, futuristic promises like “AI-powered metaverse on Mars by 2026.”
Market Analysis & Use Cases: Is there real demand for this project? Look for clearly defined use cases and how it stands out among competitors. Look for a market study that demonstrates demand, competitive positioning, and clear use cases. The project should address a significant gap or inefficiency in the market.
Risks Disclosure: Besides analysis and use cases also look for the risks associated to the crypto project. Great projects don’t just sell dreams. Instead they’re honest about challenges. Do they mention regulatory risks, security threats, or tech limitations? Is the whitepaper free of hype, excessive jargon, or unrealistic promises? Beware of guaranteed returns or “zero-risk” claims. If they do please drop the paper like a hot potato.
Additional Reading: What Are The Different Types of Whitepapers?
- Top DePIN Projects To Watch Out For in 2025 – April 24, 2025
- How To Read A Crypto Whitepaper? – April 24, 2025
- Different types of Crypto Whitepapers 101 – April 24, 2025