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OctoinJanuary 28, 2018
Node/masternode - what's that pokemon?

We continue to write training articles for you and this time we will review the nodes and master nodes. You will find out what it is and for what purpose it exists.

A decentralized network of blockchain consists of a huge number of nodes, between which information is distributed. Node is a node of such a network.

At the same time, each miner (connected Bitcoin client) and purse, which are an important component of blockchain and responsible for the security of the network are nodes. In order to node communicate with each other and transmit transaction information, the protocol - peer-to-peer, P2P (peer to peer) is used.

Full and lightweight nodes

There is the concept of a full node and lightweight. In order for the node to be complete, it must be fully synchronized with the network and store the full set of files of the block system, and also be configured to receive requests from the rest. The difference between light and complete nodes in their independence.

Lightweight nodes frequently perform the tasks which are set by the miners, so they are easily deceived and they can accept a transaction that is not true, which will cause financial loss. Especially such cases are unpleasant for sites with automatic processing of transactions.

Complete nodes, in turn, are very independent units and are the only way to maximally secure the use of bitcoin. Full nodes store all information about the network, thus ensuring compliance with the rules. For example - control over the fact that bitcoin was spent by the owner and was not spent several times.


Masternodes are somewhat similar to miners, but, in fact, they are special wallets, synchronized with the block. The main thing that is required from such wallets is to be active around the clock and maintain the network.

Masternodes perform the main functions of the network - conducting transactions, as well as additional services, such as the activation of anonymity for these transactions.
The similarity of the masternode with the miner is that by processing the operations that take place, they take a part of the coins from the new blocks, and the total profit is divided among all those involved in the process. Simply put, this technology allows you to receive a commission for the content of such a node.


If we talk about the differences between the node and the masternode, we can characterize them like this: if any computer synchronized with the network performing simple functions can be a node, then the masternode is a kind of organ with a wide functionality and great significance.

The main question, how do you raise masternode and receive passive income?

Of course, the process will not be easy. To become masternode, the user must have a wallet (for example - DASH or OctoinCoin). Which, moreover, has a high entry threshold of 1000 Dash, to have its own IP server ("gateway protocol"). Next, the user must execute a number of commands in the local wallet console to get 15 confirmations and a new status. At the same time, the user should have a fairly powerful equipment. Commission, which a masternode receives is about 7% per year.

The process is quite time consuming, but as an experienced user, by having waited for the right moment, so that the result was justified, you can get the advantage of perspective and draw masternode passive income.

We will continue to write articles for you about the blockchain and crypto-currencies. Recently, we talked about the basics and types of mining (https://octoin.com/news/n172/) , and also specifically considered PoS mining (https://octoin.com/news/n178/). Very soon there will be material from which you will learn about the ways of storing cryptocurrency in hot and cold wallets.

Octoin - new era of blockchain!