When it comes to buying a cryptocurrency, there is a nefarious practice that should never be followed: do not do your research and buy blindly. Cryptocurrencies are not just currencies that are traded like trading cards, but are usually part of a much larger project. For example, Ether, the currency of Ethereum’s blockchain network, is part of a platform whose goals go well beyond currency: developing decentralized applications, creating tokens, etc.
White papers are the manifestos that discuss everything related to a particular cryptocurrency
So what can be done to learn about cryptocurrency projects? Read the so-called white papers. A white paper is the manifesto written by the person or people creating a cryptocurrency, detailing everything related to it (ideally and if it is not a scam): technology used, summary of the Concept, future applications …
This practice has been going on since the creation of Bitcoin (which, incidentally, has hit a new all-time high), whose nine-page white paper is entitled “Bitcoin: a peer-to-peer e-cash system“Which translates to” Bitcoin: a person-to-person electronic money system “.
While this particular white paper is full of technical details (as is common in other similar works), it is an excellent place to start before investing any money in Bitcoin. always Try to follow the DYOR philosophy or do your own research (do your own research) before purchasing any digital currency.
This is a great way to determine if you are buying something that has sufficient potential to ensure its future growth, or a cryptocurrency that is nothing new or a scam outright. If a project doesn’t include a white paper, that’s a bad sign.
Finding out which cryptocurrencies you have bought is the best weapon you can have against possible losses as, while not 100% effective, it It is possible to tell whether a project is serious or not I just looked at his manifesto.