Embracing the Power of Blockchain: Advantages of Running XDC Masternodes
Institutions embracing blockchain networks find a plethora of advantages by running XDC Masternodes. The benefits are far-reaching – spanning enhanced security, transparency, and immutability of data. Moreover, by participating in the network’s consensus mechanism, institutions contribute to its robustness and resilience, fostering trust among stakeholders. The shared infrastructure further facilitates seamless collaboration and data sharing across participants, fostering an ecosystem of trust and cooperation. By exploring these advantages, institutions can thrive and lead the way in a blockchain-powered world.
Financial Rewards through XDC Masternodes
Hosting an XDC masternode may also offer lucrative financial rewards to participants. As an essential element of the XDC Network, masternodes play a pivotal role in securing the chain and validating transactions. In return for their contribution, masternode operators receive various incentives, such as…
Masternodes are entitled to a portion of the block rewards for each successfully validated block. These rewards are typically distributed in XDC tokens, XinFin’s native cryptocurrency.
Masternode operators also receive a share of the transaction fees generated within the XinFin Network. As the network’s usage grows, so do the transaction fees, potentially increasing the operator’s earnings.
In addition to masternode rewards, XDC holders can participate in staking to earn additional rewards. Masternode operators can stake their XDC holdings, compounding their earnings.
The Role of Validator and Standby Masternodes
The XDC Network relies upon a distributed network of Masternodes that run on a Delegated Proof of Stake consensus mechanism. These Masternodes can be identified in 2 categories: Validator Masternodes and Standby Masternodes.
Both types of Masternodes require the operator to stake 10 million XDC and comply with KYC procedures. The staked $XDC is locked in a smart contract and can be released only after a 30-day cool-off period following the operator’s resignation of the Masternode. The Validator and Standby Masternode operators are incentivized to maintain the Network—and ensure the Masternodes do not act maliciously against the network—since any loss of trust in the Network may result in a reduction in the value of the staked $XDC as impermanent losses.
The Role of Standby Masternodes
There are 108 Validator Masternodes (or simply “Validators”) on the Network, which operates pursuant to the XDPoS consensus mechanism to validate blocks before they are recorded on the blockchain. During each validation cycle, Validators are selected in a random round-robin process to propose and validate new blocks. Except with regard to the three Validators operated by XinFin Fintech, the Project Team has no control over the operation of the 108 Validators and does not control or necessarily know where the nodes are set up geographically.
Standby Masternodes (or “Standby Nodes”) are identical in form and function to Validators but do not participate in the validation process. Rather, as the name implies, Standby Nodes are on standby and are called into action only when the number of Validators drops below 108. As with most Validators, all Standby Nodes are owned by independent third parties. Their presence contributes to the pool of Validators no matter the weather the Network finds itself in – and their rewards come from a set aside treasury.
Empowering the Blockchain Ecosystem
Hosting a node on a blockchain network offers significant usefulness and benefits. Nodes play a crucial role in maintaining the network’s integrity, validating transactions, and ensuring consensus among participants. Hosting a masternode also enables users to actively participate in the blockchain ecosystem, earning rewards for their contributions and promoting decentralization.
Empowering through XDC Masternodes
Overall, hosting an XDC Network masternode empowers individuals and institutions to actively engage with blockchain technology, contributing to a more robust, secure, and transparent digital infrastructure.