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Main function of a whitelist in crypto
A whitelist, also known as an allowlist, is a mechanism that allows entities with permissions to access a particular service and privilege. This process is known as whitelisting.
Some time back when crypto discord servers and NFTs were the big new thing, influencers started to ask their followers to contact them if they wanted to get on a whitelist. You must remember that.
How is a crypto whitelisting different?
So, how is a crypto whitelisting different? Well, a crypto whitelist is not much different than a traditional whitelist.
A crypto whitelist is a list of participants that are given exclusive access to a particular crypto project – usually an NFT. Those on the whitelist are like the elites of the crypto community.
The term whitelist dates back to 1842 and was used to refer to a list of approved or favored items. In the blockchain space, whitelisting got famous with the launch of NFTs in 2015.
You can consider a whitelist as a database of specific digital wallet addresses that were given access to an NFT collection before its public launch.
Typically, addresses that have access can opt to buy an NFT of a specific project before its official launch at a much lower transaction fee.
The Bored Ape Yacht Club is one of most famous NFT projects to exist and people are always in lines to get their wallet address whitelisted whenever the project is launching NFTs.
Whitelist vs allowlist
There is no apparent or major difference between a whitelist and an allowlist. Both are the same terms used for the same process. Thus, know that there is no whitelist vs allowlist and that they can be used interchangeably.
How does whitelisting work?
The exclusive access given to the participants on a whitelist involves contributing to an ICO.
And what does an ICO stand for?
An ICO stands for Initial Coin Offering. It is a commonplace fund-raising strategy used by many renowned cryptocurrency companies. Most companies that are launching or are still in the development phase of their blockchain-based product, service or platform use ICOs to raise funds and subsequently market their product/platform.
An ICO is also more of a mindset and early-bird advantage game. ICOs are attractive because the investors expect to get more returns on their investment once the product has been launched and is open for more people to invest in.
So, how did we jump from investors investing in a product that has yet not launched to some whitelist that has a bunch of whitelisted crypto-heads? Imagine that a company is launching a new product and doing an ICO to raise funds. Interested people or investors can go and make the desired investment in the product. But someone with a whitelist will not have to pay if they are interested in the product. They can get direct access to it. Thus, this is the elaborated main function of whitelist.
This is the privilege that being whitelisted or whitelisting gives you. It is important to note that in the case of cryptocurrencies, the company can be the one that releases and sells NFTs. An ICO, thus, would be getting access to a classy, much-anticipated NFT. In similar vein, an NFT whitelisting would be a more accurate term to refer to an ICO in NFT projects.
How to get on a whitelist?
Anyone can be whitelisted. It can be a tedious process but with your unwavering interest, you are bound to be on that whitelist. So, how do you go about it? Let me tell you in 5 simple steps how you can be on a whitelist and become an elite of the crypto world.
1. Whitelisting Step 1 – Active participation
Now, I can understand how participation in a whitelist can be daunting for some of you (throwback to school days) but here participation refers to online participation in different Discord servers, Twitter, Quora communities, Reddit – basically any online platform where there is a community and the relevant people. Be active wherever the people from the project are and whitelisting is no more an elusive dream.
2. Whitelisting Step 2 – Get your presence noted
Once you have had a good understanding of the project, the company, what they are releasing, the know-how of their workings, etc., you can work on making sure that now they know your name and recognize your presence. This could be done by participating in giveaways or advertising their NFT projects.
3. Whitelisting Step 3 – Once they notice you, your chances will go up
Upon realizing that you are someone who has been active for the last, say, 6 months on different channels of the project, your chances of getting a whitelist spot will automatically go up. HODL on, you’re only this close to getting on that whitelist.
4. Whitelisting Step 4 – Brace for security checks
Once you are approached by any of the community members, you will have to go through some security and background checks along with providing your contact details.
5. Whitelisting Step 5 – Prepare to be whitelisted
Once approved, you will be whitelisted and can consequently, participate in the ICO.
Example sentence: I was lucky that I joined that project early and was active. It helped me in securing a whitelist spot for their new collection! ⚡️
In conclusion, a whitelist in cryptocurrency plays an important role in the ICO process. The main purpose to introduce the concept of whitelisting in NFTs was to attract people to their projects and to market them. This way creators can market their projects and in return those on a whitelist can enjoy some perks.
By pre-approving a select group of participants, it helps to ensure the security of the ICO and maintain control over the token distribution. If you’re interested in participating in an ICO, be sure to check if it has a whitelist and follow the steps to get added to it.