As you know, to insure that cryptocurrency transactions are verified, a network of computers must be online at the time of the transaction. A Masternode holds a fixed amount of a coin in a wallet that is online at all times. This is rewarding for the coin because it means that there will be computers online to verify transactions. It is equally rewarding for the operator of a Masternode because they are guaranteed daily payment and a rapid return on the cost involved in setting up a masternode as you can see. Depending on the coin, half or even more of block’s reward is split between masternode owners. The most famous Masternode coin is Dash. Masternodes are an excellent way to guarantee yourself a passive income.
- The advantage of a Masternode is that you buy it one time and get paid passively forever. I receive daily and weekly payouts from my Masternodes.
- High ROI – as you can see, the ROI from owning a Masternode is huge! And you usually recover your initial investment within a month in most cases.
- Guaranteed network confirmations – if a coin does not have participating parties, then it is subject to the 51% attack or other attacks. By having a large number of distributed MN, it would be very difficult to buy enough coins for a 51% attack.
- Supply and demand – because a large number of coins are locked up into a Masternode, the supply available for the general public is reduced. This drives up prices.
There are a number of garbage Masternode (MN) coins – the coin developer simply forks the codebase for an existing coin, tosses up a website with a fake mission statement and earns income when people purchase the requisite amount of coins needed to have a masternode. So it is important to separate wheat from chaff when choosing a MN.
The scam artist has a thought process like this:
- Download the code for an existing Masternode coin
- Make a few changes myself or hire a C++ developer for $10,000
- Create a pretty website and a fake whitepaper and roadmap for $2,500
- Pay $10,000 to get the coin listed quick and fast. Crypto-bridge is the fastest easiest and most reasonably priced.
- Charge $1,000 per masternode and promise 100% ROI on investment in 28 days
- It only takes 20 suckers to break-even. 40 suckers and I am at 100% ROI, plus I get all the coin I want for free and can dump it at anytime.
There are many such garbage projects. RACE comes to mind… cute website, high-sounding “The Future of XYZ is here!” yada yada and now look at it.
The typical hurdle to obtaining a Masternode are affording all the coins and then the hassle of setting the node up properly. The first hurdle is monetary, but since most MN (Masternode) coins offer 100% ROI within 28 days, that is usually not a problem if the price holds up. However, it can be very time-consuming and error-prone to get a MN setup, especially since a new coin will be seeing wallet upgrades on a regular basis until the coin’s codebase is stable.
For these reasons, I highly recommend the Midas Masternode system for beginners and advanced people who want to get involved in receiving automatic passive income from a one-time purchase.