Crypto nodes provide a way to earn passive income by supporting a particular crypto blockchain through verifying transactions and enhancing security. The node space is currently crowded, with two categories of nodes: masternodes and servicenodes or Nodes as a Service. However, some of these projects offer high APYs and rely on new investors to stay afloat. The video discusses six nodes that offer sustainable APYs and are not just rewarding users for creating more nodes. The nodes range from $98,000 to less than $800 and have been around for at least a year and have a market cap of over $600,000.
How Crypto Nodes Work
Crypto nodes are a popular way for investors to earn passive income in the rapidly growing world of cryptocurrency. These nodes, which are essentially computers or servers, support and verify transactions on a particular blockchain. In return for their work, node operators receive rewards in the form of cryptocurrency.
Masternodes vs. Service Nodes
Not all cryptocurrencies offer nodes, but those that do are typically divided into two categories: masternodes and service nodes (or Nodes as a Service). For example, Dash was the first-ever service node to launch in early 2014, followed by several other projects like Avalanche, Ethereum, and Chronos.
The Problem with Nodes as a Service
The issue with many of the new Nodes as a Service projects is that they rely entirely on new investors and third-party funding to stay afloat. These projects reward users for creating nodes, but there’s often no real utility for these nodes beyond building out infrastructure for new blockchains. As a result, many of these projects come with unsustainable APRs, ranging from 300% to hundreds of thousands of percent.
Sustainable Node Projects for Passive Income
In this video, Kris covers six node projects that offer more sustainable APRs for long-term passive income. He uses three main criteria to select these nodes: 1) Node rewards must come from some type of utility, 2) Break even time must be greater than six months, and 3) The main website should not mention passive income.
Examples of Sustainable Node Projects
The first project Kris highlights is Gala Games, a gaming company that aims to be the top play-to-earn gaming company on the blockchain. Node operators earn daily Gala tokens and tokens for the games launching on Gala Games. The founder’s node, which costs around $98,000, earns about $2,000 per month and takes about four years to break even. Kris also covers Flux, a proof-of-work cryptocurrency, and its different node options. The smallest node costs about $1,500 and offers a monthly ROI of around 1.44%.
The Importance of Investing in Solid Projects
When it comes to node projects, it’s crucial to invest in solid, sustainable projects with real utility. While high APR projects can be tempting, they often come with a high risk of losing investment. As Kris notes in his video, it’s important to have as many solid projects in your portfolio as possible before the next bull run.