The Best Low Risk, High Profit Masternodes for Investors in 2019

Masternodes are an alternative to blockchain mining which, while risky, can offer much greater profitability than mining itself.

Unlike with cryptocurrency mining, masternodes usually require little more than a desktop computer to run successfully. The initial outlay is significantly reduced, however you are required to stake, or ‘lock up’ your coins in order to gain rewards.

How to Invest in Masternodes

There are over four-hundred masternode coins currently operating in the cryptocurrency space, offering yearly returns ranging from 3% to 72,000%. Most of these are recently launched altcoins with little in the way of stability, and should not be trusted at face value.

Investing in masternodes should be treated with even more caution than investing in altcoins. Accumulating thousands of coins on a masternode which have no hope of making it to an exchange leaves you with a worthless bounty on your hands, regardless of the coin price. Therefore the following five factors should be taken into account when selecting a masternode:

  • Development Team – How would the team rate on an ICO analysis?
  • Community – Does the coin have an active community, or just one page on the Bitcointalk forum?
  • Purpose – Does the project have a clearly defined purpose? Does it have scope to become adopted/popular?
  • Liquidity – Is there enough liquidity to cash out if you wanted to? Or will you become a whale for a worthless coin?
  • Wallet – Does the coin have active wallets for storage and transactions?

Of the previously mentioned +400 masternode coins, very few meet these specifications. The coins covered below all meet the above specifications to varying degrees, and can be considered the lowest risk masternodes running today.

PivX (PIVX)

PivX also made it to our list of High ROI Proof-of-Stake coins, as it offers between 8-11% yearly returns for stakers.

Even higher rewards are offered for those willing to run a PivX masternode – between 13-14% according to the latest data. The value of running a masternode tends to fluctuate as and when operators join and leave the network. A shortage of masternode operators usually sees the ROI spike even higher, as the blockchain needs to be secured, and people need to be incentivized to run a full node.

PivX launched in 2016 and fell to a price of $0.0005 shortly after trading commenced. By January 2018 the PivX coin price had hit $14.25 – an increase of 2,849,900% in less than two years.

PivX Masternode Requirements

It requires 10,000 PivX coins to operate a masternode. At the current coin price of $1.03 that puts your initial outlay at just over $10,000.

In return, you can expect to collect around $1,300 – $1,400 a year in rewards. That doesn’t take into consideration the fluctuating coin price – which may also boost your investment worth over time.

Dash (DASH)

Dash makes every masternode list and readers must be sick of seeing its name. However, Dash’s longevity since its creation in 2014 makes it one of the more trusted masternode opportunities.

There are currently over 4,000 masternodes running on Dash, each gaining a yearly return of around 7.7% according to latest figures. According to this data from Masternodes.online, almost half of the entire DASH circulating supply is locked up in masternodes.

Dash Masternode Requirements

Dash straddles the line between high risk and low risk. On the one hand, running a masternode requires a lockup of 1,000 coins. At the current coin price of over $127, that means an initial investment of just over $128,000.

The risk is lessened by the fact that Dash was the original masternode coin, and has been operating for years without too much scandal.

Syscoin (SYS)

Another project that’s been around since 2014, Syscoin only introduced masternodes during the Syscoin 3.0 hardfork in 2018. Now there are nearly 1,500 masternodes securing the Syscoin blockchain, raking in an expected yearly ROI of 9.2% for their operators.

Syscoin’s growth between launch and now is another small-cap crypto fairytale – the coin price gained 452,193% between all-time low and all-time high. Just over a quarter of the SYS circulating supply is locked up in masternodes.

Syscoin Masternode Requirements

A stake of 100,000 SYS coins is required to run a masternode – placing the initial investment at $6,800 as per the coin price of $0.068.

Zcoin (XZC)

Zcoin has slowly established itself as one of the most popular masternode coins in recent times, with over 4,000 nodes running at time of writing.

The chart above shows the steady increase of Zcoin nodes since launch. It also shows the inverse relationship between node count and ROI. When the masternode count dropped suddenly in December 2018, the ROI jumped to over 600% to incentivize more people to run them.

Zcoin currently offers returns of around 19%, making it the most profitable on this list.

Zcoin Masternode Requirements

A minimum stake of 1,000 XZC coins are required to run a Zcoin masternode. The current price of $8.50 means an initial investment of $8,500. At the current rate of reward, that equates to a yearly profit of $1,612 based on the minimum stake.

Worth a Mention…

The most popular masternode coin right now is Horizen (ZEN), which has over 18,000 nodes in operation. That’s no doubt helped by the low stake requirement of 42 ZEN, or around $314. Horizen masternodes currently offer 34% returns.

Horizen is currently ranked just outside the top hundred by market cap, and is already listed on Binance.

Conclusion

Masternodes aren’t for everybody, but if there was ever a time to get into running one it is definitely now. The initial outlay for running a masternode will likely never get much cheaper than it is now.

During the last bull run, a Dash masternode cost $1.6 million owing to the coin price of $1,600, and unless we have further market bottoms to reach, it will only get more expensive from here on out.

Running masternodes requires more technical knowledge and a higher buy-in than normal staking. But with cryptocurrency mining reaching such unprofitable levels for the little guy, masternodes remain one of the few ways to make passive income in the crypto space.

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Author:
Greg Thomson is a freelance writer who contributes to leading cryptocurrency and blockchain publications like CCN, Hacked, and others.

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