People from the early stage of crypto have been either buying or mining crypto. The first crypto that was ever mined was Bitcoin.
The mining of a crypto can only take place if it is based on POW consensus mechanism. The POW required a computing power and a mining software in order to solve a math problem. In exchange for solving the math problem, you are rewarded with some coins.
Mining, in essence, validates the transaction of the coin on the blockchain network.
When considering to mine one need to consider the following:
- The mining difficulties
- Can my hardware mine other cryptocurrencies?
- What Graphics Processing Unit to buy
- Buying a mining ASIC chip
- Reliable Internet
- Thinking about a reliable cooling system to prevent overheating
- Is the coin going to increase in value in the future
- How big is the miner community for that coin
In summary proof of work cost, time, energy and hardware.
Website such Whattomine can calculate the estimated electricity cost and coins reward based on current mining difficulties before venturing into the home run mining business.
Proof of Stake on another hand a consensus mechanism is more green and efficient. It doesn’t rely on hardware or energy in order to validate a transaction on the blockchain.
By holding some coins you can get additional coins from the network but it is not constant and might vary from time to time
But by moving to a master node, you can guarantee a stable passive return.
Dash(Darknet) created the first masternode.By locking in 1000 Dash in a dedicated IP address and ensuring a smooth running with minimum downtown you will be rewarded on average every week with 2 Dash.
The current masternode reward on Dash is 45% of the block reward.
Currently, 60% of the Dash coins are locked in Masternode which also increase the value of the coins. To be able to run a masternode on Dash you need to have over $330000 to be able to run on masternode.
In order to become a masternode, you need to need to lock in a significate amount of coins in a wallet that is a masternode. By locking into that address, all the transaction verification run through the nodes. By doing so, you are rewarded by a coin.
Perhaps running a masternode for Dash is out of your budget by thanks to Masternodespro you are able to compare current masternode requirements for each coin and also understand the merit of the coins to see if there a longterm future for it moving forward.
Setting up a masternode for the first time is not easy, please look for tutorials in the selected coins on how to set one.
How To Set Up A Dash Masternode Tutorials
Masternode can be profitable when investing at the early stage but like any other investment due diligence and further research of the coin longterm potential.