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Cryptocurrency Masternodes: explained in every day language.
Masternodes are a type of passive investment, which is specific to cryptocurrency. Many people don’t understand what is a masternode. So don’t feel bad if you don’t understand them. I think they are easier to understand if you compare it to a common type of bank account called a certificate of deposit and leave out the technical jargon and technical functions of masternodes. Plus, you don’t have to understand the jargon to understand it as an investment.
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Certificate of Deposit
In the case of a “Certificate of Deposit” you deposit money into a storage container called an “account”. You agree to keep your money in the “account” and not spend it. The bank uses your money to facilitate other people’s “financial transactions”. The bank agrees to pay you money called “interest” for using your money. You get paid “interest” based on a predetermined percentage. You get paid “interest” based on a predetermined schedule. You make money every day without any work from you.
You even make money while your sleeping. This is called a “passive” investment.
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Masternodes
In the case of a “Masternode” you purchase a certain amount of a cryptocurrency coin. You deposit this cryptocurrency coin into a container called a “wallet”. You agree to keep your cryptocurrency coin in the “wallet” and not to spend it. The coin blockchain uses your cryptocurrency to facilitate other people’s “financial transactions”. The coin blockchain agrees to pay you money called “rewards”for using your cryptocurrency. You get paid “rewards” based on a predetermined percentage. You get paid “rewards” based on a predetermined schedule. You make money every day without any work from you. You even make money while your sleeping. This is called a “passive” investment.
Conclusion: As you can see these two types of investments are very similar. This is also why they are popular. Like all investments you could lose all your investment or profit greatly by some 100 or 1000 multiple. This article isn’t investment advice, but a hopefully useful explanation.
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