GIN Platform | Why Masternodes are a Powerful Investment Tool for Passive Income

Rental Income vs. Masternodes

What is the GINcoin Platform?

The GIN Platform is a service allowing you to create and run Masternodes without all the technical hassle, making it simple and easy to use even for non-technical people. With GIN Platform you can benefit from the Masternode income, with little to no need for maintenance.

GIN Platform is sponsoring the contest for 5x 10 GIN at (link). To attend, simply like, retweet and tag two friends and your favorite crypto personality in the comments. Winners will be drawn and contacted on Monday, August 20: https://twitter.com/Alt__Magazine/status/1029636155250229249

Intro

For some, cryptocurrency is the 21st century epiphany, the future of all money. For others, it’s the big bad wolf, a chimera that one should run away from. In fact, cryptocurrency is just another type of investment, that comes along with both pros and cons. In the following, we’re putting masternodes opposite to another type of investment: real estate eligible to be rented out.

Recurring Income

Rental Income (RI): Having a property that you can rent out is guaranteed to bring you a recurrent sum of money. Be it weekly, once a fortnight, or monthly, your tenants are bound by law to pay for using your property. (That is, if you’ve signed a legally binding contract, which you definitely should.) The only way the regularity of receiving payments can be disrupted is if you can’t find tenants. In the times we’re living, that’s unlikely.

Masternodes (M): Masternodes are a great way of generating passive income. Come rain or shine, a masternode will give you a certain reward at a specified time. It’s a piece of code, it doesn’t get to decide whether it should pay you or not, it is simply programmed to do so. Keep in mind, however, that masternode rewards change overtime, due to a number of reasons (e.g. number of masternodes).

Income from Value Growth

RI: Whether you’ve made improvements to the property or an important business center just opened up nearby, your real estate can go up in value easily. The more accessible it is, the more equipped, modern, and well-kept, the higher you can go with the rent.

M: This one is pretty simple to explain. The more valuable the coin, the more valuable the reward. Let’s say you’re getting 10 coins as reward from your masternode. If the coin is valued at 5$, you’re getting 50$ everytime you receive a reward. If the coin is 10$, though, you’re getting 100$ every time you get a reward! Income from value growth? Check!

Sweat Equity

Sweat equity represents the value of unpaid work that results in a market rate value increase. Put simply, it’s how much can one influence the value of the asset by putting in the effort (blood, sweat — hence the name — and tears).

RI: When it comes to real estate, every little bit of work you put into the property is bound to show. It’s one of the few investment types in which your contribution in the form of labor (as Wikipedia puts it) is guaranteed to give the asset’s value a boost. Many other forms of investment require constant toil, but not all of them give you direct control over the asset’s value.

M: At first sight, there’s not much you can do to control the value of a coin. But dig deeper and you’ll discover that you can do your part to push a coin you’re holding to the moon! Be active in the community, answer people’s questions if you can, and communicate with the project’s team. In a word: represent!

Accessibility / Availability

RI: Having property that one can rent out is not the easiest way to start your investment adventures. Well, not for everyone. If you’ve been lucky and already own some real estate, the most difficult part has passed. Don’t worry, it’s not impossible if you don’t, either. One way to buy a property (leaving aside winning the lottery), is getting a mortgage and making payments using the rent. In time, the property will have paid for itself and you will be both an owner and ready to start profiting.

M: There’s no comparison between owning real estate and owning masternodes. The latter is way more attainable, for a larger pool of people. You can compare, however, non-tech masternode investors with tech savvy people. While it may be easy for techies to set up a masternode, regardless of the coin, for less tech knowledgeable individuals it might prove to be a headache. A headache that platforms such as GIN is trying to remove.

Security

RI: When it comes to real estate, two factors that could seriously damage one’s property spring into mind: burglars and natural disasters. Both are easily countered by insurance. Sometimes it’s better to fully protect the goose and not the eggs. Invest in some good insurance and you’re covered from those robbers and extreme weather.

M: Cryptocurrency could not exist without the blockchain. This technology is considered to be one of the most secure available right now, mainly due to two things: the unique cryptographic fingerprint each block receives (the hash) and the decentralization feature (blockchain copies being kept on the entire network, instead in a single, vulnerable location). This guarantees a high level of safety for cryptocurrency as well. Keep in mind, however, that blockchain is not bulletproof. More often than not, people invent extremely creative ways to cheat.

Flexibility

RI: Immovable assets are, by nature, less flexible than their counterparts. You cannot divide them, relocate them, repurpose them. Real estate is no exception. If you already own the property, it might not be very easy or convenient for you to sell and buy something else. If you don’t, you have to choose wisely what you buy, because after you do, it might not be very easy and convenient for you to sell and buy something else. If you do, you have to… Do you see the pattern?

M: To setup a masternode, you need to have a certain amount of coins, called “collateral”. For GIN, as well as for DASH, the needed amount is of 1,000 coins. The collateral is what keeps the masternode alive and giving you rewards. Needless to say, if you dismantle a masternode by dividing the coins that uphold it, you lose the rewards, plus all the other benefits a masternode brings. Because of this, masternodes don’t get too many flexibility points.

Privacy

RI: Renting out a property must be done based on a legally binding contract. When law comes into play, there’s no wiggle room with the information you’re sharing. You must give your authentic personal information to be put in the contract, and your tenants must do the same. You can choose not to share your personal appearance, by sending a real estate agent, for example, but the legal documents will contain your personal data, and that makes you identifiable.

M: The anonymity that the blockchain technology entails gives the impression, at first glance, of full privacy. Once you dig deeper, though, you discover that, in fact, privacy on the blockchain is quite an issue. The presumed anonymity is in fact pseudonymity, which can be defined as a process of data encryption in such a way that the shared personal data cannot be used to identify a certain individual without the decryption key. Furthermore, by definition, the blockchain is a public ledger and the information contained cannot be deleted or altered. So if a transaction can be linked to your wallet, and your wallet address can be linked to your identity (maybe because you used personal data to have and use an account on an exchange), you might want to reconsider how much privacy you have on the blockchain.

Interest Rates

Interest rates do not directly apply to investments into real estate or masternodes. It’s a characteristic feature of money deposits, which get paid a certain percent as a compensation for keeping the money in that account.

Scalable Growth

RI: In order to make the real estate a scalable type of investment for you, you need a serious budget. It’s not impossible, but if you’re not a big player on the real estate market, it’s debatable whether you’ll be able to grow your property rental passive income scheme with the snap of a finger. Don’t be discouraged, hard work pays off instead and in time you can gather a portfolio of properties for you to rent out.

M: When it comes to masternodes, scalable growth is a fact. Masternodes give you rewards that in time can be used to build other masternodes. And so on. The only downside here is the time required to accumulate the needed amount to set up a new masternode from these rewards. The more masternodes out there, the longer it takes for a masternode to receive a reward. (Better explained somewhere down below in this article.)

Diversification

RI: To buy real estate is not necessarily a difficult decision. Exactly which real estate to purchase is. Location, structure, facilities, and so many other factors are to be taken into account before buying property. The pool of choices fluctuates depending on your budget. Diversification? It’s there, but it’s not that easily attainable.

M: There are SO many masternode supporting coins out there that it would be an absolute blasphemy not to give the “diversification” feature a full score. And yet, we won’t. And here’s why: if you are a non-technical person that can only rely on third-parties to create a masternode (either tutorials, people that take over the setup process entirely for a fee, or a platform, such as the GIN one), you are conditioned by the third-party’s limitations.

Turnaround Time

RI: Yet again, we have to make the distinction between already owned properties offered for renting and those still in process of being paid for. If you’re already a real estate owner, your passive income should be there pretty quickly, depending on the rent payment date previously agreed upon. If you purchased a property with the intent of renting it out, it might take a while until you get to cash in profits.

M: The turnaround time for masternodes is tightly connected to the number of existing masternodes. Here’s how the mechanism works: each time a block is mined, a randomly selected masternode will receive a reward for validating transactions, with the algorithm that selects the masternode ensuring the rewards are distributed in a round-robin fashion. (Yes, we’re quoting ourselves.) To put it simply: the more masternodes there are, the longer you’ll have to wait for your reward.

ROI

RI: Having property that you can rent out has one of the best scores when assessing the return-on-investment figures. If you already own it, it’s obvious: you’re already ahead with your compensation, since you’re receiving some money in return for allowing someone to live on your property. Most of the times, it’s extra-money, aside from your paycheck at your job. If you’re still in the process of paying to own the property, it will take a while till you attain passive income, but you’ll get there.

M: In crypto world, each masternode has a different return-on-investment degree. ROI is one of the most important stats to be evaluated in a masternode coin project. You can use a calculator or check site tools such as masternodes.online or masternode.pro to analyze a certain coin. In general, masternodes have convenient, advantageous ROIs. The worst case scenario is if a project you’ve invested in proves to be a scam. Just choose wisely.

Taxes, Fees, Insurance

RI: As with any other type of property, when owning real estate, you have to pay attention to the property tax. This is a levy imposed by the authorities and the way it is computed depends on each country. There are, however, jurisdictions that do not charge a property tax, such as Kenya, Malta, Palau etc. Since this is not usually included in rent, it will have to come out of your own pocket. Another important thing, previously mentioned as well, is insurance. It is of utmost importance for the real estate to be properly insured. Not to mention that in some countries, it is mandatory by law.

M: Property tax and insurance might not apply to masternodes, but you do have some fees to handle. From transaction fees to internal masternode administration ones (such as the cost of the hosting server), there are some expenses to be made when holding a masternode. Luckily, they’re usually quite low. The important thing is to always make sure you have a little extra besides the collateral, so your masternode doesn’t break.

Active Involvement

RI: Earning passive income from renting out property is quite a laid back activity. It might be a bit of a bustle until you find your tenants, but afterwards, it’s pretty straightforward. You only have to be there to collect the rent, or in case a bathroom tile needs replaced. Getting resourceful, active tenants is a blessing; you’ll be able to solve any issues just by making a phone call.

M: Masternodes will require a bit more of your time. It might only take 5–10 minutes, but you do have to check quite regularly (preferably daily) that everything is in order with your masternode. And if you want to get the most out of your masternode, you should ensure that the coin is performing well. The more involved you are, the higher you can drive the price of the coin. This is linked to the previous paragraph about Value Growth.

Liquidity

Put simply, liquidity describes either quite literally — cash, or an asset’s capability of being quickly transformed into cash, without having its price affected.

RI: Real estate has a high degree of liquidity, mainly because it is an immovable, valuable asset. We did, however, subtract a few liquidity points because in some cases it might take a while to transform it into cash. Time can put some pressure on the asset’s price, either because the owner is very eager to sell or if the right buyer hasn’t come up yet. Still, property prices will only be severely affected by serious incidents.

M: In this aspect, masternodes behave in a similar way. It’s not very difficult to transform cryptocurrency into cash, you just have to be on the proper exchange and have an account set up. However, the buying/selling trends are among the factors that influence a coin’s price. And it can be quite a great influence: it can make or break the coin price. For this, we’re taking away liquidity points on masternodes as well.

Scammers

RI: In the property rental business, the risk of getting scammed is quite low, because of two things. 1. You get to meet with the tenants face to face. You can assess their behaviour, their body language, their style of speech and conclude whether they seem to be shady or not. Plus, in case anything happens, you can describe them to a sketch artist or recognise them in a photo. 2. The agreement between landlord and tenant is in the form of a legally binding contract. If anything should go wrong, you have a document that allows you to sue.

M: On the internet, you don’t have the opportunity to talk face to face to the people you’re transacting with. (Except on very, very rare occasions.) As such, the risk of getting scammed rises pretty high. The internet is abundant on advice on how to choose a trustworthy project (we also pitched in some ideas here). Being fully aware of the risks is step 1 from protecting yourself against swindlers.

Liability

RI: It feels good to be a property owner. Yes, it does, no doubt about it. But you know what else your name on that ownership paper brings? Full liability. You are in charge of what happens on your property, in your property, with your property. We’re not trying to scare you away, just to make you fully aware of the responsibilities.

M: The same goes for masternodes. Even if it’s not in your power to control what happens to the project or to the market, you are accountable for what happens to your masternodes. Make sure to pay the fees, to monitor the masternode’s status and rewards and keep updated on news from the project’s team.

Required Capital

RI: How much money you need to start off your rental business venture depends on the stage of the property. Don’t have any? You’re going to need a bigger budget boat. Already have real estate but it’s not in the best shape and it would definitely need remodeling? Still need to put together a budget. The property is in top shape and ready to receive its tenants? Just pay the rental agreement document fee (if any) and be on your way to collect that passive income.

M: The needed budget to start a crypto adventure varies as well. Mainly, according to the project you choose to invest in. It might get really financially strenuous to get into a mature, well-established project at the moment. At the opposite end stand all the new, fresh, infant project which appear constantly. You won’t need as much money to get into a new project (maybe at all, if there’s an ICO, for example), but the risks you’re taking are higher, since a lot of new projects prove to be scams.

Transaction Times

RI: If you’re getting paid rent in fiat money, and you probably are (unless you’re already a crypto-head, accepting payment in cryptocurrency), all that money is under the authority of a third party (a government, a bank etc.). Third parties mean centralization, control, laws and procedures, paperwork and so on and so forth. All of these translate into long periods of waiting time until a transaction is carried out fully.

M: All cryptocurrency is subject to the same transaction times. And they are low. It’s not even comparable to the periods of time it takes to transfer fiat money from one place to another. Cryptocurrency brought the Instant Send method, which guarantees fund transfers… well, instantly.

Transaction Limits

RI: Similar to transaction times, fiat money transaction limits are also controlled by third-parties. There are certain amounts that you can deposit in or withdraw from your bank account daily. Each bank imposes their caps, which become restraints for the user.

M: When it comes to masternodes, there are two types of limits to be considered. One is the amount of transactions the network can process and the other is represented by the trading limits imposed by exchanges. The first one is an inherent characteristic of the blockchain. The public ledger represented by the blockchain can only be written as fast as the computing power behind it allows it. For example, it has been estimated that the Bitcoin network cannot exceed 7 transactions. The second type of limit is applied on certain exchange sites and it refers to the amount of currency you’re allowed to deposit, withdraw or trade on said exchange. Be sure to check all terms and conditions before setting up your account.

Value Fluctuation

RI: The real estate market is thoroughly controlled and regulated, and that doesn’t allow drastic changes in value to take place. The market can lean slightly in favour of one party or the other, depending on various factors, such as tax bills. Of course, unique, disastrous situations like the 2008 recession can appear, but, generally speaking, the real estate market is a stable one, which means that your property’s value will not fluctuate a great deal.

M: At the opposite pole from that sits the crypto market. It’s known for its volatility. One day, a coin could be worth 20,000$ and the next, just 7,000$. That’s just how crypto works. Let’s give cryptocurrency a full score on value fluctuation.

Complexity

RI: To put your property out for renting is not rocket science. However, it takes a bit of research into the legal part, and also there’s the toil of finding good tenants. It helps to have a nose for shady people that might bring trouble in the future. A bit of a hustle? Yes, but not the intricate type.

M: As stated above somewhere, setting up a masternode can prove to be a bit of a headache. You need either a good chunk of tech knowledge, a person to do it for you, or your good ol’ buddy platform GIN. The complexity of investing in a masternode coin is slowly, but surely, being reduced to the thoroughness of the research required before investing in a project. The GIN platform is eliminating the difficult setup process step by step, coin by coin.

“The article is in no way intended to be financial advice. Regardless of what your choice of financial vehicle, whether it be crypto or real estate, be aware that capital risks are real and you should only invest what you can afford to lose.”
This article was written and composed by GINcoin Platform in a collaboration with ALTCOIN MAGAZINE. To attend the contest for 5x 10 GIN, follow the instructions in this link: https://twitter.com/Alt__Magazine/status/1029636155250229249

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