The Passive Income No-Code Guide To Nodes
(little but constant)
Nodes have many names.
API Node, Seed Node, Block Producing Node Witness Node […]In essence, they all do one major thing: update a database. Nodes are crucial for the success of any decentralized ledger. The more, the better. The problem: size.
Bitcoin for example stands at 342GB and keeps growing.
In the meantime, storage needs and capacity are having an arms race, and leave little room for terabyte-sized copies of ledgers.
The key difference between most types of nodes lies in the amount of transaction history they copy and keep track of.
To incentivize someone to take on the role of a node and remove entry barriers, many chains have started rolling out various benefits such as voting rights, tokens, and even flat out payments.
Works, Costs & Profit Of Nodes — A Look Under The Hood
Uni is a blockchain that went public just recently. It is up to modern standards, has a straightforward reward system, and its nodes are fairly easy to set up. This makes it a great example.
The installation process can look intimidating but is actually easy. You open up your terminal and follow a couple of steps. If you ever followed a cooking recipe or YouTube tutorial on anything you’ll manage.
Let’s look at just the first step to visualize this.
wget https://github.com/uniworld-io/unichain-core/releases/download/v1.0.1/unichain-core.jarLooks complicated? Not really. We open a terminal, copy and paste the node we want to install into the terminal and the installation is finished. What remains is configuring the settings and/or registering an account depending on the service — which usually takes but a few minutes and is as easy as registering a new Facebook account.
Once set up, rewards pour in every 6 hours. (In the case of Uni)
Setting the node up is done in a mere couple of hours. After that, it’s only a question of electricity and hardware cost. In this case, an average laptop running 8 hours a day.
In Germany, you pay 30 cents per kWh. A laptop using 100 w/h would cost ~18 cents per 6 hours.
To calculate the equipment cost, we assume an average laptop which equals a 2.5 years runtime, i.e. 900 days, for $500 or 20 cents per day. If the rewards are higher than ~40 cents, it’s worth it. Uni rewards ~40 UNW per hour worth ~$3. This doesn’t include additional benefits like voting rights or bonus tokens. Bear in mind that this varies heavily on each node.
This is highballing it. There are cheaper laptops and Germany is the most expensive country for electricity.
Conclusion
There are also many more models of nodes each of which comes with its own benefits such as voting rights, high security (very useful if you do a lot of crypto transactions daily), trading advantages, and so forth. Unlike simple ‘hodling’, creating a Node gives you control and makes you an active part of a project. Take a look at your favorite blockchain/crypto projects and give them a shot.
