Learn the Differences Between a White Paper and a Yellow Paper

Published in

The Capital

4 min readNov 30, 2021

“White paper” has been around for more than a century, although it is now most commonly linked to digital currencies & initial coin offerings (ICOs). Investors are recommended to thoroughly research any digital coin/blockchain project that does not already have one.

In today’s digital context, the phrase “whitepaper” is increasingly commonly used to describe the idea of an enterprise or firm. The ‘yellow paper,’ on the other hand, is the project’s technical documentation. While both are referred to as ‘white papers,’ understanding the differences is critical if you’re looking to learn more about a venture or make an acquisition choice based on it.

Whitepaper: A Vision for the Future

The Canadian and British governments are credited with coining the phrase “white paper.” British Prime Minister Winston Churchill’s 1922 white paper is cited as a pioneering example. Public policy documents like white papers used to be called “white papers” in Canada.

A white paper, sometimes known as an “authoritative report,” is a document that educates the public on a particular subject or offers a viewpoint. Whitepapers are primarily meant to assist readers in better understanding a topic, resolving a problem, or coming to a decision. A frequent tool for presenting a strategic plan or persuading an investor to invest has been around since the late 1990s.

The same rules apply to initial coin offerings (ICOs) to other types of blockchain ventures. Consumers have been exposed to the whitepaper more and more since the emergence of the initial coin offering (ICO). For the sake of this discussion, a whitepaper refers to a document outlining the vision and goals of an initial coin offering (ICO), token (TOKEN), or blockchain (BLOCKCHAIN). In addition, a pitch is frequently included to entice investors and detail the potential return on investment.

Many white papers include a business strategy, a pricing structure, client and token flow diagrams, information about the team and investors, and a development roadmap.

In many cases, the technology described in a whitepaper has already been developed instead of studying future advances.

The Example of White Paper

An excellent example of this is the Ethereum whitepaper, which has sections on Ethereum’s history and philosophy and the technology and its uses. As a whitepaper, it’s meant to pique the interest of both investors and technology enthusiasts alike, but it’s not exclusively technical.

As a result, even though the title is technically focused, it is unlikely to deter anyone with a slight interest in blockchain & Ethereum from reading further.

A Technical Document Classified as a Yellow Paper

Any research that the scientific community hasn’t officially approved is defined as yellow paper research, and it outlines the research and technology under investigation.

Blockchain technology is now widely employed in academic papers and scientific analyses.

The yellow paper is a considerably more technical document for ICOs and blockchain companies, particularly creators of blockchain technology. It frequently contains promises of future technology development that have yet to materialize. Rather than the planned technologies seen in a whitepaper, it is a theoretical / research-based publication that offers potential directions for technological growth.

It is more likely that a yellow paper will give a detailed scientific or mathematical examination of a specific blockchain network as an example.

The Example of Yellow Paper

When comparing the Ethereum white paper’s language and style to the yellow papers, it’s immediately apparent that the two texts are different.

The title “Ethereum: A safe decentralized general transaction ledger, Byzantium edition” is more technical; it’s intended for users or developers who are better familiar with blockchain technology. It begins with an abstract because it’s a scientific publication. An abstract is a standard synopsis of any scientific / research document.

The Ethereum whitepaper introduces the idea and gives terminology but then dives right into complicated computational equations meant for a specialized audience.

Blockchain startups and their technical staff typically need yellow papers to create collaborations. Corporate-level investors also need yellow papers, as do people who want to exploit open-source blockchain for their projects.

A sophisticated potential investor may wish to read a yellow paper and, based on the investment size, consult an expert to check that the technology is feasible before making a decision. In contrast, the average investor may feel more secure knowing that a complicated whitepaper exists and that the technology & design of a blockchain-based invention are transparent.

Making a Decision

A white paper can assist investors of all kinds to assess the project’s quality before making an investment choice. Finding out who is working on the project and their goals will help you make an informed decision, regardless of your level of technical knowledge.

A white paper should show evidence of viability and the settlement of a technical issue or use case to be effective. On the other hand, a yellow paper should go some distance in proving or demonstrating a conceptual scientific framework or any associated research.