Staking / Nodes and masternodes

Staking

Staking is an important part of cryptocurrencies and it’s good to know a little about it.

Not all coins can be staked; they need to be (pos) Proof of stake coins.

What is Proof of Stake (POS)?

POS is an alternative process for transaction verifications on a blockchain.

To understand it a little better you need to understand what (POW) proof of work is first.

Hackernoon.com explains it best:

‘Proof of work is a mining process in which a user installs a powerful computer or mining rig to solve complex mathematical puzzles (known as proof of work problems). Once several calculations are successfully performed for various transactions, the verified transactions are bundled together and stored on a new ‘block’ on a distributed ledger or public blockchain. Mining verifies the legitimacy of a transaction and creates new currency units.’

‘The work must be moderately difficult for the miner to perform, but easy for the network to check. Multiple miners on the network attempt to be the first to find a solution for the mathematical problem concerning the candidate block. The first miner to solve the problem announces their solution simultaneously to the entire network, in turn receiving the newly created cryptocurrency unit provided by the protocol as a reward.’

‘As more computing power is added to the network and more coins are mined, the average number of calculations required to create a new block increases, thereby increasing the difficulty level for the miner to win a reward. In proof of work currencies, miners need to recover hardware and electricity costs. This creates downward pressure on the price of the cryptocurrency from newly generated coins, thus encouraging miners to keep improving the efficiency of their mining rigs and find cheaper sources of electricity.’

Now that you know what POW is it is easier to understand what POS is.

Unlike POW a proof of stake system requires the user to show ownership of a certain amount of a particular cryptocurrency. Each currency has it’s own wallet system for you to put your coins into and then stake them. Most wallets need you to run your computer 24/7 with your wallet open although a few like Neo allow you to stake without leaving your wallet open.

Hackernoon.com goes on to explain:

‘In most proof of stake cases, digital currency units are created at the launch of the currency and their number is fixed. Therefore, rather than using cryptocurrency units as reward, the forgers receive transaction fees as rewards. In a few cases, new currency units can be created by inflating the coin supply, and forgers can be rewarded with new currency units created as rewards, rather than transaction fees.

In order to validate transactions and create blocks, a forger must first put their own coins at ‘stake’. Think of this as their holdings being held in an escrow account: if they validate a fraudulent transaction, they lose their holdings, as well as their rights to participate as a forger in the future. Once the forger puts their stake up, they can partake in the forging process, and because they have staked their own money, they are in theory now incentivized to validate the right transactions. ‘

What is delegated proof of stake? (DPOS).

Daniel Larimer invented Dpos. It requires coin holders to vote for ‘delegates’, who then become responsible for validating transactions and maintaining the Blockchain. These Dpos coins do not require you to keep your computer on 24/7 while staking and therefor are more eco-friendly and easier to stake.

Why do people want to stake?

1. Proof of stake tends to be more energy efficient than POW and because it encourages anyone who has the coin or node to stake the coins it is also much more decentralized.

2. Another added bonus to why many like POS is that it encourages the holders of the coin to keep them long term thus making POS coins price more stable than others as people are not just trading in and out of them for profit. You get rewarded to hold your coin just like a dividend from owning shares.

3. Unlike POW where expensive equipment is needed or mining rigs if you wish to mine, staking costs the investor literally nothing. They simple need to leave their wallet open on their desktop in the background and you get rewarded.

4. Not only this, but it is often very simple to set up as opposed to mining etc and so less tech knowledge is needed.

5. Also when you stake you can use the coins staking calculator and you know each month how many coins you will receive and what they will roughly be worth and so is a predictable source of income. Some people actually live and pay their rent off their staking rewards.

It is very important that if you decide to stake that you use the latest Virus software and back-up your staking wallets and private keys/passwords! Many people also buy desktop computers that are used solely to stake their coins and if you are staking a few coins it may be worth thinking about doing the same

 

POS Coin list
Staking coins calculators
POS Coin list

POS (proof of stake) coins.


Which are the most known coins to stake?


The most popular coins to stake at the moment are:


1. Neo


2. Pivx


3. Lisk


4. Qtum


5. Nav coin


6. Ark


7. Reddcoin


8. Neblio


9. Stratis


10. Vechain


11. Decred


12. Komodo


13. Smartcash


It is worth noting that many coins are looking to add staking in the future like Ethereum.


Useful guides to staking the main coins:


Pivx https://pivx.org/knowledge-base/staking-setup-guide/


Lisk https://help.lisk.io/voting-and-delegates


Nav Coin https://navcoin.org/for-individuals


Reddcoin https://www.reddcointalk.org/category/12/academy


Neblio https://nebl.io/2017/07/01/staking-explained/


Stratis https://stratisplatform.com/wallets/


Vechain https://vechainthorcalculator.io/


Decred https://docs.decred.org/mining/how-to-stake/


Komodo https://komodoplatform.atlassian.net/wiki/spaces/KPSD/pages/71729215/What+is+the+5+Komodo+Stake+Reward


Smartcash https://forum.smartcash.cc/t/smartcash-smartnode-setup-guide/2320

Staking coins calculators

Nodes and Masternodes

 

What is a node?

A node is very important and allows the blockchain network to function and survive. A node is a device on a blockchain network, which is in essence the foundation of the technology. Nodes are distributed across the network and carry out a variety of different tasks.

A node role is to support the network by maintaining a copy of the blockchain and sometimes nodes are needed to process the transactions.

Node owners contribute their computer resources to store ad validate transactions and therefore have the chance to collect the transaction fees and earn a reward for doing so.

A full node downloads a complete copy of a blockchain and checks all new transactions.

What is a master node?

p>A master node is the same as a node, but the holder of a master node receives a dividend for running the master node. To run a master node the buyer usually has to hold a certain amount of a particular coin.

It is best to try and get in very early to buy a master node, as they tend to go up in value. Dash is a perfect example, you need 1000 coins for a master node and you could have picked up a dash coin for less than a dollar in the past, at the all time high one dash coin went to $1,500 a coin.

Why do investors want a master node?

Coins that have master nodes or staking tend to hold their value better than other coins that do not offer a reason to hold them. If you are lucky enough to buy a master node early on you can achieve a great return on your initial investment and get a nice monthly income from them.

 

List of master node coins to buy
Choosing a good master node
List of master node coins to buy

List of master node coins to buy


Not all master nodes are created equal and it is important to find the good ones that will last.


Here are two links that have a full list of master nodes, how many you will need and the return you should expect from having one. There are many nodes available to buy, but below are the most popular ones.


  1. Dash

    What is Dash?

    (link to Dash coin page)


    Website:

    https://www.dash.org/


    Master node set up guide:

    http://dashmasternode.org/setup-your-own-masternode/


    How many Dash coins needed for a master node?

    1000 Coins.


    Further Information.

    https://www.dash.org/masternodes/


    ROI:

    6.84% Yearly.

  2. Pivx

    What is Pivx?

    (link to pivx coin page)


    Website:

    https://pivx.org/


    Master node set-up guide:

    https://pivxmasternode.org/masternode-setup/setup-your-own-masternode/


    How many Pivx do you need for a master node?

    10,000


    Further Information:

    https://pivx.org/reward-system/


    ROI:

    53.92 Pivx a Month.


    Calculator:

    http://pivx.cryptonode.co/

  3. Blocknet

    What is Blocknet?

    (Link to blocknet coin page)

    Website:

    https://www.blocknet.co/


    Master node set-up guide:

    https://github.com/BlocknetDX/blocknet-docs/blob/master/blocknetDXservice-node.md


    How many Blocknet do you need for a master node?

    5000


    ROI:

    16.53% Yearly.

  4. Zcoin

    What is Zcoin?

    (Link to zcoin page)

    Website:

    https://zcoin.io/


    Master node set-up guide:

    https://zcoin.io/zcoin-znode-setup-guide/


    How many Zcoin do you need for a master node?

    1,000


    ROI:

  5. Vechain

    What is Vechain?

    (Link to Vechain page)

    Website:

    https://www.vechain.org/


    Master node set-up guide:

    https://vechaininsider.com/guides/guide-to-vechain-nodes-and-node-rewards/


    How many Vet do you need for a node?

    ROI:

  6. Nuls
Choosing a good master node

Not all master nodes are created equal and it is important to find the good ones that will last.


Here are two links that have a full list of master nodes, how many you will need and the return you should expect from having one.


https://masternodes.online/


https://masternodes.pro/statistics

What to look for before buying a master node?

  1. Utility and use case of a token.

    It is important to know that many cryptocurrencies have been created just to take advantage of buyers looking for master nodes. When you buy a master node you need to think will this coin be around in 2, 3 or 5 years time. Look at their competition and see if they are better.

  2. Investigate existing master nodes and what people think of it.

    Go to the social media groups of the coin you are interested in and see what the feedback is. Are they happy? Are the returns constant and do they really pay out the dividend they promise?

  3. Roadmap.

    Research the future plans of a Cryptocurrency you are interested in. Is there a planned future? Have they hit their roadmap targets on time? Are their plans and goals realistic to achieve?

  4. The Team.

    Legitimate projects have social media groups where you can talk to the team and get answers to your questions. Any project that doesn’t have a visible team with proven experience in the projects field should raise a red flag for you.

  5. Block rewards.

    Investigate how the block reward may change over time as with a master node you are in for the long term. Some rewards are reduced over time, so you need to know if this is the case.

  6. Coin holding.

    When deciding on a cryptocurrency it is important to look at how many coins the team own. Is there a large amount of coins not in circulation and when will they be released? Is there a lock up period? A perfect example of this is Veritaseum, which has 2 million, coins in circulation and 98 million coins total supply.

  7. Volume and liquidity.

    This is often an over-looked aspect of buying a coin. You will some daily volume in your cryptocurrency in order to sell some of your rewards. However some coins have low volume and liquidity at the beginning but later on if the project is good there can be much more volume later on to sell into, you might need to give it time.

  8. ROI

    Is the return on investment % good enough to hold long term? However some coins will be worth a great deal more so compounding your rewards and selling much later on you can increase your profit substantially.