How to write Security Token Offering white paper? Ultimate STO guide!

The crypto space is collectively moving towards the new fundraising strategy, the Security Token Offerings. With this demand, STO whitepaper writing services are becoming a high priority for businesses interested in Security Token Offering. However, these papers should be drafted in accordance with the guidelines imposed.

Added, the recent fall of ICO has also been the reason behind this gilt-edged strategy. Moreover, Whitepapers have already killed ICO’s. Since there are a plethora of companies who are ready to offer $100 for writing a single whitepaper. Thankfully, Security Token Offerings (STOs) are reliable answers from the crypto-community to the challenge thrown by the regulatory authorities.

Okay, this article completely discusses the steps involved in drafting best white paper STO to bring in potential benefits.

A White paper is a technical document intended to inform the users about the complete solution for a specific problem. These are the excellent tool which is created to educate the users about the product in-depth. In specific, an STO Whitepaper addresses the STO solution before getting started with the project.

This document may contain details such as the countries where the product is legal, the business outline, technical layout, the product details, the expert team, the token market, business prototype, etc. Therefore, a Whitepaper is considered to be crucial for the business.

Before knowing how to write STO white paper, you should consider the following general guidelines:

• Breakdown your content into smaller ones to enhance the readability. Make sure there is not more than two headings in a single page.
• Keep your summary short. If it is more than 350-350 words, you are not in the right way.
• Remember your target audience for the white paper is a crypto investor. Add a token sales summary sheet with all the token sale and related details in a tabular manner as an executive summary.
• Learn to make Flowcharts using popular online tools such as Lucidcharts, to make the content more intuitive.
• Don’t repeat your sentences. Don’t plagiarize your own content.
• Finally, give importance to your solution, not the Blockchain technology.

White papers are the soul part of any process. White papers provide a ready solution to solve the problem. 76% of people make use of white papers as a decision making the process.

How to create a white paper for STO?

Authorization:

Regardless of the product, you are offering, it is crucial that you mention your terms and conditions.

These forward-looking statements are being provided by the law firm once after reviewing the complete STO white paper structure. It should include sections such as:

• Countries where the product is legal

Mention the countries where your product is completely legalized. Regulators in different countries have restrictions for their citizens to invest in countries under sanctions.

• Terms & Conditions

Privacy policy of the tokens also plays a major role here. This section informs the scope of the product to the user.

Business Outline:

This is the most important section in STO white paper services. This section was actually skipped in ICO’s which had led to potential losses. Investors come from various backgrounds and would not be aware of the current industry.

Therefore, your whitepaper should answer them to know the ins and outs of the industry. Moreover, having this section could add wealth to the whitepaper for the benefit of readers.  

The industry overview should include areas such as:

• History of the industry

Put forth the readers to bring in chronological phases of development, innovations, and inventions happened over the past and how it is now. Sometimes the industry might have gone down. Try to picture them clearly for a specific area.

• Upcoming Trends in the industry

Every white paper should come up with emerging trends in the industry. If your industry is not on an emerging one, try to specify the problem here. Added, provide the solution as well. This could provide a trust factor here.

• Market Potential

There cannot be a product without a viable market. Try to represent the market using graphs, charts, infographics to present the market size.

Product Abstract:  

This is the adhesive section which the trader is actually looking for. In the product description, you should write your solution which addresses the problems. In order to know how to create an STO white paper, remember your readability factor throughout the document. Give additional importance to readability in this section.

Your section should consider:

• Overview of the Result

This section should involve a brief review of the product being built. There is a high likelihood that the solution may consider several modules that communicate with each other to a complete unit.

For instance, your cryptocurrency exchange may consider wallet, portfolio, an algorithmic module which would have been connected in the backend but presented as different phases in the front end.

Therefore, your solution must contain a small paragraph on each section and a simple diagram representing the connection between each other.

• The Complete Resultant Details

Depending on the complexity of the solution, this section length can be up to 10 pages. However, if you go beyond this, your readers would start skimming. Therefore, remember this.

Thus, this section should include details about your solution which could bring in the best STO white paper. To ensure that if the content in the section does not drive home the solution, try by making them infographically.

For instance, if you are building a token offering for the solar-powered plant, your solution can have the following areas:

• People can buy/sell tokens
• How will the solar-powered plant be built
• How you will prevent misuse
• Details of the front-end components

Provide all these details in a pristine manner such that the reader can find interesting!

Technical Layout:

A Technical Layout is the representation of the flow of information from one part to the other. Moreover, it will be the most scrutinized section of the whitepaper, remember.

A well-written Technical Layout should consider the following parts:

• Technology Used

In this section, it must contain the list of frameworks you will be using and the different technologies involved. The reason why you are using a specific technology should be clearly mentioned.

Similarly another back end development languages, libraries should also be integrated without any denial.

• Process Roadway

In this section, expand all your scope of actions you are going to implement clearly. You can make use of flowcharting tools as assistance to create diagrams for easy understanding of readers.

Ensure it doesn’t cross a single page since the idea is to depict the data flow from component to others.

• FAQ’s

Your reader would have reached halfway through the whitepaper. Meanwhile, they would end up with some queries or doubts on the same! Using this opportunity, you can provide instant solutions as a reader and make your whitepaper reading enjoyable.

For instance, if you are providing a solution for cryptocurrency exchange, your edge cases can be:

1. What happens when they try to sell a token that they do not own?
2. What happens if a liquidity crisis?
3. What happens if the trade engine faces a heavy transactional load?
4. What happens when the matching engine fails to find any matches?

Token Market & Token Offering Analysis:

This is the section which is going to differentiate between ICO and STO. Therefore, this is the peculiar section to be taken into account. To put it in simple words, tokenomics is the creation, supply, and management of token.

Therefore, in this section, it is important to do a radical difference between ICO and STO. For instance, in an initial coin offering a white paper, you could not use the words such as “profit”, “guarantee”, “asset”, etc.

This section should consider the following ones:

• Token Formation

In this section, present the various attributes of security tokens and the description of the token’s underlying asset structure. A security token is similar to utility token but with a difference. A Security Token has a condition that must be fulfilled before it is transferred from one wallet to the other.

• Token Progress

This offers the flow of token from one actor to the other as well as the channels used to complete the transaction. Yet another key detail to be overlooked is, the STO Whitepaper is the segregation of the token flow of each actor. The best way to represent them is through flowcharts along with the explanation of the text section.

• Token Sales Event Information

This section covers the token details of the STO. This part must contain:

• The dates of the token sales event.
• Whitelisting or Know Your Customer listing of STO.
• Total Token supply.
• Total tokens sold till date.
• Parts of the tokens sales event.
• Token Symbol.
• STO Website Link.

• Future scope of the product

It contains the details about the fate of the funds raised by STO. If you look from an investor’s perspective, it is important while evaluating a product/ platform offering.

Business Prototype

This is the section which most of the writers would skip and omit. This contains the following subsections:

• Business Prototype

A Business Prototype is nothing but the ways through which the company makes money. For example, if you consider Uber’s business model, it can be solo rides, shared rides, etc.

Similarly, STO also contains several methods through which revenue can be earned! Identify that and provide a clear description of that.

• Revenue Prototype

A revenue prototype is a basic structure by which the STO gains revenue. It identifies which revenue source is more profitable, how to price the token, and which actors pay value derived from the token.

• Product Roadmap

This is the crucial section for any kind of product you are drafting whitepaper. STO development can take anywhere between 1 to 3 year so know how your product is needed and the duration will depend on that.

The Team

It is time to honor your team. Give complete details of the team involved. It is important for the investor to know about your team, their background and the total expertise of those people. For the sake of increased readability, you could split your sections into:

• Management Team
• Advisory Boards
• Development Team
• Business Development Team
• Sales & Marketing Team

    When mentioning the details of the team, remember to mention:

• Name
• Past Experience details
• Relevant Experience details.
• Role in the project.
• Link to the LinkedIn profile.

This section could be worth for STO white paper cost. Since your team would have worked day and night to complete your project! Therefore, it is worth mentioning them.

This is how to develop a white paper for STO finally! Make sure you mention all these without fail!

In the end, if you ask me how much does an STO white paper cost? Yes, it depends on your project requirements ultimately! Depending on the project complexity is the STO Whitepaper!

Drafting a Whitepaper is not a simple task. However, not a tedious task as well. So know the requirements completely before getting into a whitepaper. If you are a newbie writer, know the white paper STO definition initially. Know the count of the words, pages, right usage of infographics, flowcharts to make your traders buy them.

Any longer content could actually bore your traders and there is a high chance of skimming. For example, if you had skimmed this article, you would have possibly gone through the subsections and bold letters to make you understand easily! Follow the same for your STO white paper as well!!

Being a top-notch Security token offering Development Company, you can get in touch with us if you have any unique requirements for your business!

Hope you found this article interesting!!