One of the oldest and most effective ways to earn a crypto passive income is by running masternodes, contributing the computer power necessary to drive a blockchain.
A masternode is a type of full node in a blockchain network that performs additional functions beyond simply validating transactions. Masternodes typically require a significant amount of collateral in the form of the blockchain’s native cryptocurrency in order to operate, which incentivizes their owners to act in the best interest of the network.
That said, by operating a masternode, the investor will be rewarded with the blockchain’s native currency. In contrast with regular nodes, masternodes don’t add new blocks of transactions to the blockchain. Still, they verify new blocks and have unique roles in the blockchain’s governance, such as voting on changes to the ecosystem and running protocol operations.
Running a masternode requires some expertise but also a significant collateral investment. Investors should be prepared to buy a substantial stake in the native cryptocurrency, purchase more expensive computer hardware than the average laptop, and consider the running costs.
For this reason, masternodes can be seen as a long-term investment. Running a masternode may require a substantial initial commitment, but little effort is needed to keep it running once it is in use.