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Everything you need to know about bitcoin

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What is Bitcoin?

If you’ve heard of cryptocurrency, then you’ve almost certainly heard of Bitcoin. Founded in 2009,  Bitcoin was the very first decentralized cryptocurrency. A software developer, by the name of Satoshi Nakamoto, is said to be the creator of Bitcoin. Unlike fiat currency, bitcoin isn’t controlled by any central authority. Created and stored electronically, bitcoins are produced by computers around the world. These computers use software to solve increasingly complex mathematical puzzles, with solutions rewarded in bitcoins. Much like regular currency, bitcoin can increasingly be used to purchase goods and services electronically.

Bitcoin offers a number of advantages to fiat currency. Aside from being decentralized, it’s very easy to buy bitcoin and set up a bitcoin wallet. There’s a level of anonymity to bitcoin, since addresses are not linked to personal information. Transparency is offered through the blockchain, which is a sort of digital ledger. This database allows you to see all of the transactions on the Bitcoin network and how much Bitcoin a person has in their wallet, without knowing their identity. Bitcoin and blockchain transactions are quick and cheap, in comparison to those offered by banking services.

While many other cryptocurrencies have been created since then, bitcoin has remained the most popular option and continues to dominate the crypto market today. Most people who buy bitcoin, and other forms of cryptocurrency, do so as an investment. This is hardly surprising, as the price of bitcoin has gone from a few cents per coin in 2010 to over $7,500 per coin in late 2017. At the time of writing, the market cap of bitcoin is $150 billion. Needless to say, bitcoin has attracted increasing attention over the years. Having a bitcoin investment strategy can make all the difference long-term.

 

Is it legal?

The legality of bitcoin really depends on where and how you use it. It’s certainly something of a grey area, due to the lack of regulation in the cryptocurrency industry. As such, the legal status of Bitcoin varies from country to country. Because it’s often undefined or changing in different countries, it’s important that you take the time to check this important information.

As of November 2017, Bitcoin is illegal in the following countries: Bangladesh, Bolivia, Ecuador, Kyrgyzstan, and Nepal.

Why would anyone want to ban bitcoin? Well, governments have concern over Bitcoin and other forms of cryptocurrency because of its ability to be used anonymously. While most people who buy, hold, and spend bitcoin do so with perfectly legal intentions, there are some who have used it for money laundering and other illegal activities. Perhaps the best example is Silk Road, a now defunct online marketplace that became infamous for the selling of illegal drugs.

 

Buying and selling

Buying and selling bitcoin is increasingly easy thanks to the growing number of online exchanges. The biggest bitcoin exchanges are available in most countries worldwide, but be sure to check the legality of bitcoin in your country before buying. On a Bitcoin money exchange, you can also learn how to trade. We recommend you take the time to do this rather than using a bitcoin bot, which is likely to be unreliable.

Here are some of the most popular Bitcoin exchanges to consider:

  • Binance: On Binance, you can buy Bitcoin, Binance Coin and many other coins. In fact, there are many different cryptocurrencies available. It’s known for being quick and offering relatively low fees.
  • Bitfinex: The largest bitcoin exchanges by trading volume, Bitfinex offers plenty of advanced trading features. Fees are relatively low, as compared to many exchanges.
  • Bitstamp: Bitstamp is a popular fiat to bitcoin exchange. It has a simple user interface and high trading volumes. There is good support offered in Europe.
  • Bittrex: One of the larger cryptocurrency exchanges, Bittrex offers most major cryptocurrencies. Setting up a basic account is very easy and customer support is decent.
  • CEX: Beginners will like CEX, since it has an easy-to-use interface. You can also find a nice range of trading features, if that’s of interest to you. Overall, it’s a reliable option.
  • Coinbase: Coinbase is probably the most beginner-friendly Bitcoin money exchange around. It’s available to users in 32 countries and offers a range of payment methods.
  • GDAX: Operating all over the world, GDAX offers good liquidity and competitive fees. It’s run by the same company that owns Coinbase, but offers lower fees.
  • Gemini: Gemini offers fairly quick account verification as well as comparatively low fees. Customer service response time is also quicker than many other exchanges.
  • HitBTC: Relatively low fees and a solid trading platform make HitBTC an option to consider. Bitcoin and other coins are available for trading on this platform.
  • Kraken: Kraken is a popular option in Europe, thanks to low transaction fees and free SEPA deposits. It’s available in most countries and offers plenty of features for bitcoin security.

If you still need help finding the best cryptocurrency exchange for your location, take a look below:

USA: If you’re based in the USA, then you should have no problem buying bitcoin. You can use most exchanges. In terms of bitcoin for beginners, Coinbase is recommended as it is easy to use. For low fees, try Bitfinex.

UK and Europe: If you’re based in the UK, or elsewhere in Europe, you’ll want an exchange that offers easy SEPA transfers. As such, Bitstamp and Kraken are good options to consider. Coinbase also offers a service in Europe.

Canada: There are fewer options available to those buying bitcoin in Canada. One of the most popular options is QuadrigaCX. Additionally, Canadian dollars can be used on Coinsquare.

Australia: Like most countries, Australia can use Coinbase for buying bitcoin. However, for trading back to AUD, take a look at BTC Markets or CoinJar.

India: Located in Delhi, Coinsecure is one of the more established bitcoin exchanges in India. Unocoin and Zebpay are also popular options.

Singapore: Aside from Coinbase, Singapore’s main options when it comes to buying bitcoin are CoinHako and Luno. In fact, CoinHako is based in Singapore.

It’s also possible to buy and sell bitcoin at a Bitcoin ATM. Currently, the vast majority of Bitcoin ATMs are located in the USA, and there’s a good chance that the Bitcoin ATM locations aren’t near you. However, if you are lucky, a Bitcoin ATM withdrawal is a good way to access your newly purchased bitcoin.

 

Storage options

How to Store Bitcoin

Once you’ve purchased your bitcoin, it’s important to keep it safe. It’s generally considered unsafe to keep your cryptocurrency on exchanges, as there’s a risk of your bitcoin being hacked. For this reason, you’ll want a bitcoin wallet which makes it easy to check how much bitcoin you have. There are several different types of bitcoin wallets, ranging from desktop to paper. While most wallets are just for one particular cryptocurrency, some allow you to store other crytocurrencies as well. Read on to find out about each of the wallet options, and how to go about choosing one that’s right for you.

 

Wallet options

How to compare and choose a bitcoin wallet?

A btcoin wallet is the combination of a public address and a private key. At first, you may feel a little overwhelmed with the number of bitcoin wallet options. However, it’s really a good thing to have so much choice. The type of bitcoin wallet you choose depends on which features most important to you. For convenience, you may want a web wallet, or one on your phone, for checking your bitcoin by mobile device. On the other hand, the bitcoin security offered by a hardware or paper wallet may be of greater value.

What is a bitcoin desktop wallet?

Quite simply, a bitcoin desktop wallet is one that you can access from your desktop computer. They store the private keys to your bitcoin information on your hard drive. Desktop wallets are available for Windows, MAC OSX, and Linux. One of the most popular is the Electrum Bitcoin Wallet which, while not particularly pretty, does the job required. It’s very secure and has a number of interesting features.

What is a bitcoin paper wallet?

A bitcoin paper wallet is just as it sounds. It’s the transferring of digital coins onto physical paper via a printer. The advantage of paper wallets is that they are offline and safe from malware. You are also fully in your control, as opposed to wallets that are operated by a third party. However, paper is obviously susceptible to damage. It’s also vulnerable to theft, so it’s important to place your paper wallet in a very secure location.

What is a bitcoin mobile wallet?

Some people choose to have a bitcoin mobile wallet in order to check their bitcoin amount and transactions while they’re on the go. When it comes to accessing your bitcoin accounts by mobile device, there are mobile wallets available for Android and iOS. They run as a bitcoin app on your smartphone. A popular mobile wallet for both Android and iOS is BreadWallet, which is known for its simplicity. BreadWallet is great for beginners.

What is a bitcoin hardware wallet?

Another option available to you is storing your bitcoin, or at least the private keys, on a hardware wallet. Unlike the other types of bitcoin wallets, hardware wallets aren’t free. However, the price may be worth it if you have a substantial amount of bitcoin. Hardware wallets cannot be hacked as they are secure, offline devices. There’s hardly an abundance of choices. Two options to seriously consider are the Ledger Nano S and the Trezor Bitcoin Wallet.

What is a bitcoin web wallet?

Also referred to as online wallets, bitcoin web wallets store your private keys online. This allows you to access your web wallets anywhere, on any device. Some of these link to mobile and desktop wallets, which certainly offers convenience. However, leaving your private keys in the hands of a third party is risky, particularly if you hold a large amount of bitcoin, which could put you at greater risk for a bitcoin hack. If  you’re still keen on the convenience of them, take a look at the web wallet offered by GreenAddress, which offers more security features.

What is a bitcoin brain wallet?

A brain wallet involves you memorizing the private keys of your bitcoin; the private key is never written down. Naturally, this is much more secure than leaving physical evidence of your private key, such as on paper or a web wallet. However, the risk is that you may forget the private key and lose your bitcoin forever. The security of your funds is dependent on the strength and complexity of the passphrase chosen – the longer the better, as long as you can remember it!

What is a bitcoin private key?

A Bitcoin private key is a secret, alphanumeric number which is randomly generated when you create a wallet. It allows you to spend and send your bitcoin. A private key is not to be confused with a public address, which is what you use to receive funds. Your bitcoin private key needs to be kept in a safe and secure location. That may be on a piece of paper, on your hard drive, or on hardware. For maximum security of your bitcoin information, your bitcoin private key is better off with you than with a third party, such as a web wallet.

 

Debit card options

How to compare and choose a bitcoin debit card?

One bitcoin payment system that lets you spend your bitcoin, as you would spend fiat currency from a regular debit card, is the bitcoin debit card. It works by drawing bitcoin directly from your bitcoin wallet. The advantage of this is that you can spend your bitcoin in more places, since bitcoin debit cards are typically VISA cards. You’re no longer limited to buying from a store that accepts bitcoin, or from having to convert your bitcoin to a fiat currency in order to buy things. Some of the main bitcoin debit cards to explore are Wirex, Cryptopay, and Xapo.

It’s important to take the time to compare and contrast the various bitcoin debit cards. When comparing and choosing a bitcoin debit card, consider the following points:

  • Fees: Unfortunately, there are fees associated with bitcoin debit cards. This may include a delivery and activation fee, as well as ATM and foreign transaction fees.
  • Security: If you’re spending bitcoin from your bitcoin wallet via a debit card, you want to know your wallet is safe. Be sure to check security features available.
  • Customer Service: There’s nothing more frustrating than slow support. Read reviews on customer service to make sure the customer service is quick, reliable, and friendly.
  • Apps: The ability to see what you’re spending is undoubtedly convenient. Some bitcoin debit cards offer you a bitcoin app for this. Both Android and iOS options are usually available.

 

How to trade

How do I trade bitcoin?

It’s one thing to buy bitcoin and hold it long-term, and another to trade bitcoin on a regular basis. Trading bitcoin can be extremely profitable, but it’s not without risk, due to the overall volatility of cryptocurrency. In order to trade bitcoin, you need to find a bitcoin money exchange. Earlier, we mentioned some popular bitcoin exchanges. Take a look at these and research available locations, transaction fees, liquidity, reliability, and overall safety and security. In particular, Bitfinex and Kraken meet most of these requirements. Coinbase is much easier to use than Bitfinex and Kraken, but the fees are higher.

 

How does it work?

How do bitcoin transactions work?

In the case of bitcoin, everything is very transparent. Bitcoin transactions are digitally signed for security. Everyone on the bitcoin network can see a transaction, and transactions between two addresses are stored on a vast public ledger, known as the blockchain. By looking at the blockchain information, you can see the information regarding the block and balance of a particular bitcoin address. While this isn’t very private, a degree of anonymity is offered since no personal information is linked to a bitcoin address.

In order to send bitcoin, you need a bitcoin address and a private key. These are generated when you create a bitcoin wallet. When you send bitcoin, you use your private key to sign a message with a transaction input in order to create a record of which address the Bitcoin is coming from. You also include a transaction output, which is the recipient’s bitcoin address, and the amount you want to send. The bitcoins are then sent out onto the bitcoin database and verified by miners before being put on a transaction block and solved. Miners are paid transaction fees and a subsidy of the newly created coins.

How does bitcoin mining work?

We’ve just briefly touched on transactions being verified by miners. Now we’ll explore bitcoin mining a little further. Without bitcoin mining, we wouldn’t have bitcoins. In order to mine bitcoin, miners use special software to solve mathematical problems. Bitcoin data mining works much like mining for physical resources, such as gold, in the sense that it’s resource-intensive and increasingly difficult. It’s designed this way so as to control the number of blocks found by miners each day.

In order to be considered valid, individual blocks must have a proof-of-work, which is verified by other bitcoin nodes when they receive a block. A proof-of-work is a method used to ensure that time and money went into making a block. Not only does mining serve to create new coins, it also serves to verify the legitimacy of transactions. This prevents a person from spending the same bitcoin twice.

 

Mining

Bitcoin Mining

How do I become a bitcoin miner?

If you’re interested in mining bitcoin, you’ll probably want to take a look at setting up a bitcoin miner. The alternative is bitcoin cloud mining, which we’ll cover shortly. First, you’ll need to consider hash rate. This is the number of calculations your hardware can perform each second, as it attempts to solve the mathematical problems put before it. The higher your hash rate and bitcoin mining power, the more likely you are to solve a transaction block. Second, it’s important to consider energy consumption. Read further and you’ll find out more about this in relation to bitcoin mining cost and profitability.

Once upon a time, you would have been able to mine with a Bitcoin CPU miner. Nowadays, the main bitcoin mining problem is that you’ll need to spend more money on an ASIC bitcoin miner for mining activities to be worth it. Based on price per hash and electrical efficiency, you’re best choices for hardware are the AntMiner S7 or S9, depending on your budget. Once you’ve purchased your bitcoin mining hardware, your next step is to download a program for mining bitcoin. The two most popular are CGminer and BFGminer. You should also consider EasyMiner, if you’re looking for a more user-friendly experience.

What are bitcoin mining pools?

In order to make money mining bitcoin, you’ll probably need to join a bitcoin mining pool. A mining pool consists of a group of miners who pool their resources together. This increases your odds of being rewarded, but decreases your reward as it is shared with the other miners in the pool. You’re unlikely to get rich from a bitcoin data mining pool, but you will be rewarded on a more consistent basis. Most of the biggest bitcoin mining companies are located in China, due to the cheap cost of electricity there.

When choosing a bitcoin mining pool, you need to ask yourself a few questions. Consider the following:

  • Pool Size: The bigger the mining pool, the more frequent the payout. However, the reward is then split between more miners.
  • Reward Method: There’s a wide range of reward methods in crypto mining. This dictates how and when you’re paid. The most common are PPS and PPLNS.
  • Fees: Most bitcoin mining pools charge fees. These can vary a great deal from pool to pool, so be sure to check to details regarding fees.
  • Security: Choosing a mining pool that offers bitcoin security, as well as personal security, is of the utmost importance. For increased security, look to more established mining pools.

How does cloud mining of bitcoin work?

You don’t need a bitcoin miner of your own in order to get involved with mining bitcoin. With bitcoin cloud mining, you can avoid much of the hassle involved. Cloud mining means using shared bitcoin mining power, which is run from remote data centers. By buying a particular cloud mining contract, you’re essentially renting some of the available hardware to mine bitcoin.

The advantages of cloud mining are that there is no added electricity costs and no expensive mining equipment to deal with. However, a few issues to consider are that profits are lower and that most bitcoin cloud mining companies are scams. This makes finding the few good bitcoin cloud mining companies even harder. It’s very easy for someone to take your money, claim that they’re mining for you, and then not pay out fairly or at all. One of the few bitcoin mining companies to consider is Genesis Mining. This is a Hong Kong-based company which offers three different mining cloud contracts.

How do I calculate mining profitability?

First of all, it’s worth mentioning that bitcoin mining is highly competitive due to the existence of huge mining pools. The difficulty of mining is constantly increasing, so you should work out the costs to mining bitcoin to see whether it can be profitable for you. You can do this with a bitcoin mining calculator, which will let you enter the data of the bitcoin miner in order to see how long it will take for you to make a profit.

One of the key things to consider when it comes to the profitability of mining bitcoin, aside from the cost, is energy consumption. Mining cryptocurrency consumes electricity, which can be costly. Check the energy consumption of the hardware used, as measured in watts. If you’re using a bitcoin mining computer to run your mining hardware, you’ll also need to factor in its electricity consumption.

 

E-commerce

Bitcoin ecommerce

How do I accept bitcoin payments in my store?

If you have a business, you may wish to accept bitcoin payments. It’s easier than you think to install a bitcoin payment system. The easiest way to do this is simply place a sign on your store, whether it’s in your shop window or on your store’s website. Chances are, only a small number of people will want to pay in bitcoin. These customers can ask you for your wallet address in order to pay you using bitcoin.

When it comes to accepting payment, you have a few options. Customers can pay using hardware terminals, such as a bitcoin app or via QR codes. The user can then scan the code and press ‘spend’ in order to buy a particular item.

Bitcoin e-commerce services for merchants

Setting up your website’s bitcoin payment system is now easier than ever before. There have been a number of bitcoin e-commerce services springing up in recent years. Currently, the most established and popular options are Bitpay and Coinbase. One newer option in 2017 is Shopify. While there are other e-commerce services available, it’s recommended that you research them thoroughly before choosing them for your bitcoin store.

The Complete Guide to ICO Community Management

On YavinMay 2, 2018
vectopicta / Shutterstock

Successful ICOs require a multi-faceted approach to marketing. High profile advertising bans from Google, Facebook, Twitter, LinkedIn, and MailChimp are squeezing the ICO marketing channels available. However, what the bans mean is that other methods of marketing an ICO will need to get more attention. There are of course many conventional and non-conventional marketing channels that can be utilized, but one particular element is gaining a lot of traction and importance in ICO marketing strategies: the role of an ICO Community Manager.

What is an ICO Community Manager?

If there was just one platform in the world for people to exchange information about upcoming ICOs and cryptocurrency news, it would make marketers’ lives a breeze. However, that isn’t the case, and marketers’ lives are not a breeze. While there is no unanimously agreed upon definition of the cryptocurrency community, it can be loosely described as a vast and widespread group of people who connect via different mediums in cyberspace. It is the responsibility of the ICO community manager to engage and optimize the community through the mediums favored by the cryptocurrency community.

The channels that fall under the responsibility of the ICO Manager vary, dependent on the company size, its budget, its overall marketing strategy and the ICO manager itself. However, an ICO community manager should be looking to establish a presence and the transparency and trust needed for a successful ICO across as many channels as possible.

Crypto Community Channels to Manage

Channels vary in popularity from country to country, but the main channels favored by the crypto community are:

Telegram – Warmly embraced by the cryptocurrency community from its very outset. This platform, in the process of its own ICO, has a “secret chat” facility which allows conversations with end-to-end encryption and other security options. Telegram is an important part of a community manager’s strategy and it is much more direct than other channels and provides the opportunity to pinpoint key messages so that new users are always kept up-to-date.

Reddit – The Reddit crypto community is a hard to win over crowd making Reddit management one of the more challenging aspects of the Community Manager role. Generally, the Reddit community is a knowledgeable and unforgiving group, but gain their trust with transparency and regular engagement, and you have the ability to make an ICO.

Quora – This content-based channel requires the management of good quality content and keeping on top of updated threads. Again, a knowledgeable community and a community that should be catered to.

Facebook – Although ICO advertising was banned from Facebook in January, community building and maintenance through pages and groups are still allowed and popular. Posting and commentating in other crypto groups also gains exposure. Facebook has over 2.2 billion active users and is too big for a community manager to ignore.

Twitter – ICO advertising bans came into effect in March, but Twitter is very popular among the cryptocurrency community. By using hashtags and tweeting three times a day, it is possible to draw attention and convey your ICO message.

LinkedIn – Another of the social media platforms that implemented a ban on ICO advertising this year, but still popular within the crypto community. There are knowledgeable, professional people in crypto and blockchain groups that have tens of thousands of members, all of which can be accessed and engaged with for free.

Steemit – A Reddit style content sharing platform that is becoming more and more popular with the cryptocurrency community. An ICO manager will need to post quality content and engage with other users.

BitcoinTalk – Probably the biggest and most important of all the specialized crypto forums. A community manager will need to engage with the forums to promote their ICO project. Regularly updated, it is one of the more labour intensive community channels to optimize, but an excellent channel for coverage.

Medium – Similar to Quora in that it is used for publishing important content that conveys the information and message you want to get across.

The Difference Between an ICO Community Manager and a “Regular” Community Manager

There is some definite blurring in the roles of an ICO community manager. What’s the difference between what a social media manager does versus a community manager, and what’s the difference between an ICO community manager and a “regular” community manager? Well, a lot depends on ICO management strategy and its intended presence in particular channels, and a lot depends on the actual person.

When one thinks of a “regular” community manager, someone who posts on Facebook, Twitter, Instagram, Pinterest, and LinkedIn springs to mind. Community managers are generally more social media centric with some forum posting. Regular community management is about engagement and being able to convey and respond to messages.

ICO Community management, on the other hand, requires a much more hands-on approach to community management, and demonstrate a far higher level of expertise and knowledge than “regular” community management.

The elite community management required in ICO community management needs a willingness and an ability to engage across many platforms throughout the whole ICO process 24/7, across different time zones.

The ICO community manager has two very clear tasks which a regular community manager probably doesn’t have: Pre-ICO and Post-ICO. Pre-ICO, the ICO community manager has the responsibility of building trust, gaining exposure, and cementing brand identity. How the information is conveyed and how communities are engaged can make or break an ICO before its launch. Post-ICO is just as important for an ICO community manager, as they have the responsibility to maintain and moderate social media ICOs channels, follow up on the shares and comments, and answer all the questions or queries community members may have.

In the immediacy of an ICO crowdsale, too often a post-ICO strategy is put to one side. The ICO community manager is vital for keeping engagement levels up and keeping the community informed. Keeping the community engaged is crucial for any next phase of growth in the ICO campaign or blockchain-related project.

Qualities Needed for an ICO Community Manager

Now, no one is saying that ICO Community Managers need to have super-human powers, but there are certain qualities needed to be a successful ICO Community Manager.

Dedicated – Community Management requires a 24/7 committed approach.

Knowledgeable – This is not a position where you can bluff your way through. You will be expected to be the ‘face’ of the ICO and know everything about the company behind the ICO, including the technical aspects. A strong knowledge of blockchain technology and the crypto world is essential for an ICO community manager to build trust within the crypto community. Try and bluff your way through, and you will get found out very quickly, especially on Reddit.

Patient – An ICO community manager will have to deal with all types of community members and potential investors, some more knowledgeable than others. Also, the ICO community manager will have to answer the same few questions repeatedly on a daily basis – “How much do I get?” and “When are the bounties distributed?” are two of the most common questions an ICO manager will have to answer… a lot! Patience is important.

Communicative – The ability to communicate is essential to the role of ICO community manager. Different messages will have to be conveyed to different groups in different styles, so the ability to get the ICO message across to the right people in the right way is a big responsibility of the ICO manager.

Flexible – Most ICO community managers are forced to wear many hats. Facebook group posting one minute, then posting 1000 word articles on Quora the next minute, requires a degree of flexibility.

Alert – Crypto ICO news comes in thick and fast and it is the job of the ICO community manager to stay on top of the news and events and react accordingly.

Experienced – The key to successfully running a community is being part of the community itself. The ICO manager must know the nuances of important channels like Reddit and BitcoinTalk and ideally be experienced members themselves, to be able to fully optimize valuable the resources.

 ICO Community Managers Playing a Bigger Role

In the fast-growing world of ICO consulting which has sprang up alongside the equally booming ICO crowdfunding industry, more importance is being placed on the role of the ICO Community Manager. Simply put, the ICO community manager can make the difference between a successful ICO and a failed ICO and there isn’t an ICO PR agency worth its salt that doesn’t realize that.

There is no definitive role description for an ICO community manager, its tasks and responsibilities vary from person to person and company to company. However, the function and purpose do not differ and the person who sits in the role or roles of ICO community managers will have the biggest impact of all. Get the right person who has the attributes listed above and provide them with the right tools, budget and backing and they can go a long way to help an ICO enjoy long-term success. As the advertising bans intensify and the coin launch calendar becomes busier, the ICO community manager will have more responsibility and more power to make or break an ICO. Therefore, it is essential the right person(s) fill the roll with the right backing given to carry out a defined and widespread ICO community management strategy.

Keep Reading

How to check a whitepaper

Gracie AppeltMay 1, 2018

A whitepaper is arguably the most important document for any crypto ICO. However, the style and contents of whitepapers can vary drastically. We reached out to several crypto industry leaders to find out what they look for when reviewing a whitepaper. Read their quotes and gain valuable insight regarding what aspects of a whitepaper are considered to be the most important, and what some red flags might be. This post is updated monthly, so be sure to check back to see who else has been added and what their suggestions are for reviewing a whitepaper.

 

  1. Ami Ben David, Co-founder and managing partner of SPiCE VC: “We specialize in tokenization, so my initial focus is first to see if the project is suitable for our specific investment criteria – in our case, I’m checking if it is delivering a key building block of the blockchain / tokenization ecosystem that we know is missing, or has room for more players and massive growth, or is it a new revolutionary protocol with some following, or a tokenized business which has a unique edge in the market because of the use of the blockchain or the smart use of a token economy. If the basics are not there, its a quick No for us. But if the story does meet our focus criteria, we look at the team (which we need to talk to anyway to form an opinion), what is their story and the way they choose to tell it, and I try to compare the big vision and big words with how much they actually achieved in terms of execution in the time they had to spend on the project so far. If it all makes sense, I schedule a call.”
  2. Ofir Beigel, Owner of 99Bitcoins.com: “I make the same suggestions to crypto investors and blockchain startups alike. Look at the team, the tech, and the market. Additionally in the white paper look for an alignment of interest. What are the long and short team motivations for all stake holders? Are the interests of the founders and advisers in parallel with the large investors and are they in line with the users of the platform, protocol or service? Even before the blockchain the old adage of “follow the money” provided an enormous amount of insight. For example: Are the issuers offering discounts or bonuses? Are they transparent about this and are they putting in vesting or lockout periods? Some founders check the box saying “yes we have a vesting period so investors cannot flip the token.” But when that vesting period is only three months and the first deliverable is four months out, that is pretty much worthless.”
  3. Lou Kerner, Partner, CryptoOracle: “While we take a holistic view of projects, for CryptoOracle, the team is the most important aspect of the Whitepaper. We actually use machine learning/AI to help us evaluate teams.  We are also very focused on the problem being solved and the role the tokens play in that solution, starting with, does the solution really require a token (and blockchain)? Then we look at token economics to ensure the token economics align the different players in the ecosystem. Governance is critical for decentralized projects. We also look for realistic roadmaps. For the most part, poorly written Whitepapers are more hurtful to projects than well written Whitepapers are helpful.
  4. Motti Peer, Co-CEO of Blonde 2.0: “We receive hundreds of whitepapers, and as most investors with little time, I review many of them. With this being said, if the whitepaper does not immediately state the company’s purpose and process, chances of continuing to read them are slim to none. With so many white papers, it’s crucial to remain relevant by stating and emphasizing the clear message of the company and its product. This is the difference that can make or break successful projects.”
  5. Yaniv Feldman, Co-founder & Chairman, Cointelligence: “Today’s whitepapers are different from what they used to be in the past. Satoshi’s whitepaper was nine pages and was almost entirely technical. Today’s whitepapers are 30-80 pages long and are full of marketing info, roadmap, team and investor offering. While Bitcoin is very different from today’s ICOs, I still try to focus on what matters. I try to understand if the company is solving a real problem, for a real, big-enough, relevant market, instead of just building a “decentralized” solution to the same problem other have solved centrally without any relevant additions (besides so-called decentralization) or a made-up problem that doesn’t really have a real-life, big enough use case to sustain the existence of such a project. Most project fail at this level. If a project passes the first stage, I take a brief look at the team and try to understand if their token economics structuring makes sense (how many tokens, inflation rate, built-in incentives to stakeholders, consensus mechanism, etc).”
  6. Eric Turner, Research Lead, Messari: “Whitepapers are still the best way to gauge how well a project will execute. I have learned it is best to skip to the end and see who is leading, advising, or investing in the project. With that in mind, start from the beginning and don’t skip the “fluff”. This is often dismissed as marketing speak but can give you a good idea of how realistic the project is. High hopes are to be expected, but if a project thinks they can overtake multiple existing markets or only want to offer a slight change to existing solutions, you should put on your skeptic hat. Be more skeptical if the team and advisors have limited experience in the space. Give the technical details a good read but realize that anything too technical is a distraction. A great whitepaper will address the “why” and the “how” of a project. Most projects today want to be the AWS, Uber, Airbnb, eBay, Facebook, etc., of the decentralized world. The “why” is how you will be better than these solutions. The “how” is even more important. The best whitepapers will give details on how their solutions will outpace competitors, gain a community, and incentivize developers. A detailed roadmap is something to look for. Even though whitepapers are early-stage ideas, having a defined timeline for development is important. If you really want to understand a project look at who is running it and map that against how feasible it is they can execute on their goals.”
  7. Melanie Mohr CEO and founder of YEAY, Creator of WOM: “When reviewing a whitepaper, I look for the following: simple, concise language that cuts to the point quickly – there’s absolutely no point filling up the word and page count for the sake of the thud factor. A well articulated and watertight vision – I need to see a clear and inspiring concept that I can get behind. Credibility and expertise – I need to feel faith in the team behind the idea. User experience – does it have a good UI/UX? Technical detail – what’s actually being built and what’s the go-to-market strategy. It’s easy to say “this is x, built on the blockchain, to disrupt y” but how will it actually do this?”
  8. Martin Wos, Co-Founder, Co-CEO and CVO of Block Stocks: “Firstly, the validity of the business model. The model should make economical sense. If an idea already exists, not important if off- or on-chain, a new idea have to be 10x better. Just because an idea is decentralized, does not attract clients. Think from a client’s perspective. Then, start looking at how the technical components (technical whitepaper) and the token sale structure. Under which conditions does the currency appreciate in value and why? What are the underlying drivers and do I fully profit from it or are there any constraining conditions? Also do research about existing business models. What are the differences, advantages and disadvantages of similar business models.”
  9. Evgeny Ponomarev – Co-founder and CEO of Fluence: First of all, you have to understand the difference between the Whitepaper and Primer. The first is a technical document while the latter is for pitching. Since the decentralized technology landscape is yet full of “terra incognita”, don’t expect the team to answer all the questions, but at least they must understand the challenges that exist and the obstacles they face. The best way to understand how a proper whitepaper looks is by reading ones made by great, successful projects: IPFS and Filecoin, Plasma, TrueBit, Polkadot — these served as an inspiration for our team.”
  10. Dr. Omri Ross, CEO of Firmo Network: “When reading a whitepaper, I always look for academic rigor. Is the paper describing an existing product or does the team have the skillset to execute on the vision depicted in the paper? Does the product cater to a relevant niche and is the business model and go-to-market-strategy carefully designed to suit the customers needs? If the product is distributed or decentralized, has appropriate measures been put in place to provide a feasible governance model?”
  11. Sharon Shineberg, In-House Blockchain Maximalist at Blonde 2.0: “When I first read Satoshi’s white paper, I could not sleep many nights. I was up restless and obsessive over bitcoin. In my experience, I can only compare this occurrence to the ‘rabbit hole effect’ from Alice in Wonderland. From afar, there’s a dark hole in which another world exists; once you’ve stepped foot in the hole, there is no turning back. Curiosity is contagious, and this is the exact effect I am looking for when reviewing white papers.”
  12. Dror Futter is a Partner at the Rimon, PC law firm: “Whitepapers should provide a description of the regulatory compliance of the token. At this point in time, any ICO claiming to be a “utility token” should be viewed very skeptically. Potential token buyers should be very leery of overinflated legal claims. For example, many ICO’s claim to be issuing “SEC compliant” tokens with little explanation of the basis of this claim. This is critical because at this time, there is not a single ICO that has received the express approval of the SEC. In other instances, whitepapers identify the prestigious law firms ICO’s have hired and leave it unclear what advice they received. Our firm was approached by an issuer three days before their ICO after their global law firm withdrew from the representation. Their whitepaper still said they had consulted with the firm – which, while technically true, was also misleading. Potential token buyers should also look for details about how the tokens will trade after issuance and what the issuer will do to ensure ongoing regulatory compliance. While ICO issuances have gotten all the press, the after-market trading poses as many regulatory issues.”
  13. Jonathan ben Shimon, CEO of Matchpool: “It is more important to look at the formation and the architecture to determine whether it is original or not. I care more about new architecture and existing technology than about those who are trying to force the economy on our business.”
  14. Liron Langer, Chief Investment Officer at Nielsen Innovate: “Based on experience and involvement in subsequent projects, the most important factor and the things that should be carefully analyzed in any whitepaper you’re considering: The team, and in particular, do they have DLT real experience and whether they address a challenge at a cost that is significantly lower than the benefits the adoption brings, do they understand the token usage, utility and value model, many teams fail to understand this critical factor. What do they achieved so far, what’s the use of funds plan, what’s the development roadmap, how will their economy interact with the token once it hits the market? How effective and professional is their social media presence? I am glad to see that the market evolves towards addressing real challenges in a much more professional manner with global brands, as well as the due diligence done accordingly by investors. STOs will help weed out bad actors, can be linked to virtually any type of investment, and could grow to $1+ trillion value in a few years’ timeframe.”
  15. Jon Buck, President, B&B Content Management: “Think of a young person going on their first date. They spend hours making sure that they look their very best – picking outfits, fixing hair, agonizing over every detail. Why? They want to attract the person they are meeting. The same is true with a whitepaper. Investors who look at a whitepaper are ‘dating’ the company. To attract the best investors, the whitepaper has to look its best. Typographical errors, broken English, punctuation and grammar mistakes – these are like massive red flags to investors that the company is not mature enough to even clean up on a first date. If a whitepaper is clean, well written, properly edited, with excellent grammar, it shows a care and consistency that makes a company investment-worthy. Companies that don’t take the time to produce a professional whitepaper only prove that they are not professional, and generally, destined for failure.”
  16. Adi Karmon Scope, Founder of Fractal Boutique: “When I review a whitepaper, I’m most interested in the token economics section. The reason is that a company must justify the creation of a new token, if it would like to embark on the ICO route. If I’m convinced that a new token is indeed needed, then this means that the idea and eco-system are much larger and more valuable than the company itself which is conducting the ICO. Most of the whitepapers I read are vague about their economy and lack lots of details about how they’re planning on creating intrinsic value to their token. A healthy economy is about creating new value, which is captured via the token and not about only creating artificial scarcity.”
  17. Chad Pankewitz, CEO of Coinage: “Evaluating crypto and blockchain companies can be done in a similar way to how a venture capitalist would evaluate an investment. Here are a few things that we look for when reading a whitepaper: Will the company’s main product be useful? What problem will the company solve? Do they have a great vision for their company and for their products in the market? Is the product and the technology truly great? Do they have the team to execute the vision? Does the project have traction – in terms of product readiness, users, community, and revenue? Who are their competitors? To be able to do our own research, I want to be able to understand from their whitepaper where they fit in the market; such as, are they a cryptocurrency, blockchain platform, or a protocol? Furthermore, if they are a cryptocurrency, are they a privacy coin, a stable coin, to be used for fast payments or just a storage of value? The more drilled down the categorization is, the better we can understand the competition and evaluate accordingly. Last but not least, longevity is one of the factors that you want to be certain of after reading a white paper: Will the product and company have a good chance of succeeding over the long term in this space?”
  18. Adi Ben-Ari, Founder and CEO of Applied Blockchain: “There’s an old joke about the physicist, the chemist, and the economist stranded on a desert island with a single can of food. How are they to open it? The economist’s answer is, ‘Assume we have a can opener.’ The joke should be updated for the Cryptoeconomist. Check the technical and token economy assumptions made in the whitepaper, look out for bold assumptions about technology that doesn’t exist, or gaps in the token economy model. A few more important areas to consider are the idea and solution that they are proposing, is the company creating something new, or just building an existing technology?  Also, in regards to the token, whilst reading ask yourself, does this solution need a token? Is what they are proposing really a blockchain solution from the ground up, or simply a regular tech startup looking for funding by issuing a token? Most tokens are generally created as a utility token, so the question needs to be, does this serve as a true utility or has the token been added to the solution so they could raise capital through an ICO? And lastly, in terms of competition, is this solution part of a dozen others that are already successful, or is it different enough to add value to the blockchain ecosystem?”
  19. Tai Kaish, CEO of Wemark: “Traditional investors get a chance to do their due diligence by meeting the founding team and asking in-depth questions. The whitepaper is often the only way for ICO investors to evaluate the company, its product, and future plans. When reviewing a whitepaper, investors should compare the associated risks of the project, to the potential gain. Projects will usually outline the market size and opportunity early on. Realizing the risks, however, is something each investor has to do on his own. Each key factor presented in the whitepaper (team, product, token economies, roadmap, competition, etc.) might hold potential risks and prevent the projects from reaching its goals. Following deep research, investors should support projects that demonstrate the lowest risk along with the biggest potential outcome. It’s great when teams get technical and explain how their protocol works with code samples and architecture flowcharts. It’s easy to get carried away in technical descriptions, but it’s crucial to understand why people will want to use it, not just how it works. For some projects – marketing, sales and UX are more important than expertise in smart contracts or blockchain development.”
  20. Johnny Kolasinki, Head of Media at XYO Network: “The first thing I look at when reading a whitepaper is the project’s purpose. Are they solving a real problem? Does a blockchain-based solution to this problem make sense? I’ve seen projects that had amazingly innovative implementations of blockchain technology or DLT; however, they were trying to replace existing platforms without actually addressing any flaws in the models that are already in place. If a project is going to compete with existing technology, it needs to clearly lay out how it will either augment or improve upon what’s already out there.”
  21. Mark Vermeeren, Global Marketing Manager of MobileBridge Momentum – “For us, one of the most important aspects of a whitepaper is that it correctly communicates the value of the service or product. No matter how well written, how awesome the design of the paper is, or how cool the graphics used look, the offer needs to be strong. Additionally, the reasons indicating “why blockchain” or “why an ICO” should provide an understanding of the product or service’s USP, and specify the way it changes the paradigm of its respective market. Naturally, investors and crypto enthusiasts will consider funding a project whose likelihood of success is high; so, in order to properly assess the value proposition, it is important to also detail the competitive advantages, and the specifics that relate the strengths of the solution to the market dynamics.”
  22. Darvin Kunaiwan, CEO of Crowdvilla: “The first thing that I would look for is the problem area that the project aims to solve. After that I’ll look at the detail surrounding their token economy: what does the token represent, how will the token retain value and how will the token be distributed initially. I’ll come up with my own conclusion on whether this type of token will be considered as securities or otherwise, which then allows me to see whether the project is being done in a legally responsible way. Next I’ll look at the team – not so much on finding hyped up factor (personally I don’t believe ex-big mnc matters much in this case) – but more towards seeing that there are indeed real people fronting the project, and that it is not an elaborate scam. Finally, if applicable, I’ll look at their basic approach from the technical point of view, on whether it makes any sense in achieving what they set out to do.”
  23. Avishai Shoushan CEO of Carats.io: “When you review a whitepaper there are several crucial issues that must be addressed. For us, the things that are most important for reviewing the project through it’s whitepaper is the order of the content, while looking for the known entity, team and partners who stand behind the project and the token. Another important criteria is the token usability, while asking if there is a real need and use for the token, except for fundraising. The last aspect is the technology and value standing behind. In which stage the company is in, regarding technology if it is deploying, alpha, or beta and what will the token bring considering it’s long term value, beyond of speculation.”
  24. Ran Avidan, Founder & CTO of Mobilechain: “The first thing I look at when reviewing a whitepaper is ‘The Team’ section. Do they have past experience building and creating a new business in the targeted industry? The Mobilechain team has a lot of experience in the mobile industry, so we try to focus on that in our whitepaper. The next thing I look at is the solution itself and if blockchain is really needed to solve the issue. There needs to also be business potential in the idea.  Like every investment, I expect to see a bit of market research and thought into how the solution will make an impact.”
  25. Barak Ben Ezer, CEO of Neema: “My advice for reading a whitepaper: I’m more interested in projects that solve the three underlying barriers to adoption: (1) interface, volatility and solving the legal status of crypto (what we are doing with SOV.Global), (2) looking for impressive team more so than impressive advisors, (3) explain to me what you’re doing in the first paragraph. The more concise and clear the better. Long convoluted is explanations and lots of fluff are a red flag. I’ve noticed that geniuses are typically people who can explain very complex issues in very clear terms. Satoshi’s bitcoin white papers from the 2009, was nine pages of pure gold. Less is more.”

 

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What You Should Know When It Comes to Crypto PR

Motti PeerApr 27, 2018

It’s no secret that a cryptocurrency PR agency can be a strong factor in making or breaking your product and, sadly, your company. So putting your trust into the right hands is crucial. If it’s not known yet, the official press release announces any news or updates that a company has to share with the public. The success of a release and securing media coverage can do wonders for your company.

Let’s get into the details of what it looks like at each stage of your ICO and how to find the right cryptocurrency PR agency for you:

Pre ICO

It’s the beginning of a new era for your company, which you’re hoping will be the next big thing or at the very least a successful project that will lead to even greater success in the future. At this point, you have an idea of what your token will be and the utility behind it. Now, you’re going to need seasoned PR experts to represent you throughout the length of this process, so you start the search for a crypto PR agency. Taking care of this first step can really push your project further than you could ever imagine. The success you achieve with your new agency will have a big impact on your token.

Think long and hard about who you will be hiring and make sure you are comparing a few options. Part of your research ought to include talking to others around you and in the industry, performing a general search, and checking out the reviews. This process helps rule out the ones that don’t fit your standards for the work you expect. Focusing on past successes and having a proven track record are clear indicators when picking a PR agency.

Let’s fast forward a bit to after you’ve picked the perfect PR agency and it’s time to create a PR strategy. This is the point where the crypto PR strategy must align with your company’s idea, messaging, and product. Make sure to have a back-and-forth to ensure that you’re getting exactly what you want. Speak up and don’t be shy! Part of this stage is creating the crypto PR itself, which also may involve many iterations as things evolve. Once it’s complete, it’s time to move on to the next step.

Now comes the media outreach. This is one of the most important pieces of this entire process because this is what will lead to success in securing coverage. As I like to tell my clients, all token PR is good PR as long as they spell your name right, and I stand by that. Getting back on topic, a good rule of thumb is quality over quantity. In other words, it’s better to have a smaller group of writers that are 100 percent interested in covering your story. Rather than having a large quantity of writers that won’t be interested, you want the influencers in the space that care about the topic and have covered it at length. In this case, the odds would be in your favor and they will better understand your mission.

Before we move on, let’s discuss the advantage of having a ‘bazooka.’ In our case a bazooka is a known politician, celebrity, athlete, or an esteemed professor can really make a difference in the success of the campaign. We all know that a bazooka can pack a punch and have a big impact. The advantage of having one in the crypto world is entering an entirely new ball game. I suggest all my clients to get a bazooka because it’s not only going to make my job easier and more fun, but it’ll make the clients project more successful and newsworthy.

During ICO

Your ICO has started and you’ve already reached the hard cap thanks to the great ICO PR you had. You’ve also received great coverage thus far. Congratulations, you did it! But, the work isn’t over just yet.

It’s time for you and your community team to build a presence on your social media accounts, especially if you haven’t done so yet. That means being active on Facebook, Twitter, Telegram, Medium, Reddit, Steemit, and Bitcointalk. It’s best to constantly share notable news, project updates, and interact with users on a daily basis. You’re not just growing these social platforms, but maintaining interactions and creating that strong presence that you want people to talk about for years to come.

While your team is focusing on building the community, the PR team is working to secure more coverage. Whether it be about updates or even connecting your project with current headlines, it’s important to go after every relevant angle.

It’s also a great time to be on podcasts and write thought leadership pieces. Both of these are great for maintaining coverage and displaying your expert knowledge of the industry. By positioning yourself as a leader in the industry, you will show the community that they can trust you and your project.

Post ICO

Fast forward a few months or maybe even a year, your company is established and you’ve built a strong community. Furthermore, your token is doing great! What more could you want? Well, there’s a simple answer to that question. You should always want more. There are certain limits with this way of thinking, but none-the-less your work with the PR agency isn’t over just yet.

Constantly having updates and news to share with the community is always a great way to stay in the media and, of course, keep people interested in your token. This doesn’t change after the ICO is over. One great story to share is when your token officially enters the exchanges. People who have invested in your token will care and take notice to this effect because  they will need to decide on their next steps.

It’s important to be completely transparent about what you are doing because a lot of people have decided to invest in your token. There are too many scams out there these days and you are not one of them. Constantly sharing updates about your token, letting the community members know when there will be a beta of the product to test, and having a demo that can be used by writers is all necessary. By putting these types of stories out for community members and journalists your project will gain more legitimacy.

Part of PR agency’s outreach includes submitting the CEO, CMO, COO, and others for various event opportunities. Events can include sponsored options like paying for a booth to exhibit or  getting on stage for a speaking opportunity to discuss a project or industry. These are great opportunities to get out into the world of crypto, technology, and the specific industries your product is targeting. At these events you can network with other professionals and leaders in the industry, getting to pick their brains on how you can improve your own ideas, while securing possible collaborations in the future. It’s important to note that no matter the success of your ICO, attending these types of events can really show you off as a leader in the industry, and can open many doors to the business world. Connections are everything. It’s also helpful to submit the company for awards to display your success. Plus, every company wants to receive awards.

Wrap It All Together

Whether you’re in need of a blockchain PR agency, crypto PR agency, ICO PR agency, token PR agency, or cryptocurrency PR agency, your team should be making your project feel like it’s the single and only project that is being worked on. They should be doing everything in their power to make your project and PR a success, no matter what the story.

About Motti Peer

Motti Peer is the Co-CEO of Blonde 2.0, an award-winning global PR agency. Also named as one the startup nation’s “Movers and Shakers” on Forbes. With a team of 35 professionals, Blonde 2.0 one of the leading forces in PR for Blockchain and Crypto, startups and VCs.

The views expressed are of the author.

Cointelligence invites global Blockchain and crypto professionals to share their opinions and expertise with our readers. If you would like to share your point of view, please contact us at info@Cointelligence.com.

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