I am the creator and moderator of the Crypto_Currency_News subreddit. Each day I invite the world to post links to their favorite Bitcoin and crypto related articles. Here I plan to give my thoughts on popular articles I have opinions on.
Today’s article is Make Money with a Masternode While You Sleep.
I have run Masternodes in the past without really understanding the purpose, so when I saw this article posted I decided to dig a little deeper to help deepen my understanding. The article gives a basic overview of the functions Masternodes perform. The definition I liked was…
“A Masternode is a server on a decentralized network. It is utilized to complete unique functions in ways ordinary nodes can’t. It can be used for features like direct send, instant transactions or private transactions.”
For me, I needed to understand without full scale modifications, there are limitations to what the basic blockchain and associated wallets can achieve. For this reason Masternodes employ code to plug additional functionality into the network, and reward the people running these nodes with coins in return.
PIVX is a coin I have Masternode experience with. It uses the Masternodes to make transactions on its network private from prying eyes. In a basic blockchain you can use an explorer to track the origination and final destination of coins, but with PIVX Masternodes this becomes impossible. This is just one example of how they are used.
People sometimes pay to use a Virtual Private Server (VPS) to host their Masternodes. I asked someone the reason for this a few days ago. When you run a Masternode on your own system, it broadcasts your IP address to the Network essentially announcing to the world you have digital currency. The VPS eliminates this. Also, the best guides for Masternode setup I have seen are written from a Linux perspective using a VPS, so the documentation available to set these up is readily available.
On the negative side for VPS, when there are updates or disruptions to their system and it goes down you are not in control to get it fixed. You have to wait for someone else to get to it. This was frustrating for me.
Check the article for links to a list of Masternode coins if you are interested in giving one a try. There are many to choose from.
Thanks for reading!