The principle of independent nodes is a kernel of the work of any decentralized cryptocurrency, as the nodes participate and confirm transactions and, in fact, form a blockchain.
All independent nodes must confirm each other’s actions, i.e, reach a consensus to form a new network unit that is called a consensus algorithm. The most common algorithms are PoW (Proof-of-Work) and PoS (Proof-of-Stake).
But now we will explain how the hybrid LPoS algorithm (Leased Proof-of-Stake), i.e, “leased proof of ownership interest”, works. This type of confirmation is relatively new and has not yet become widespread, but it holds potential and a great future is predicted for it.
This consensus mechanism has its significant advantages: for example, it attracts all users, regardless of their stack, to work on protecting and securing the network, and distributes the reward fairly, as each participant receives their share in proportion to the contribution. This is an excellent opportunity even for owners of a small number of coins to get a stable profit.
The essence of the algorithm is that owners of smaller amounts of cryptocurrency rent their coins to full-fledged nodes, while the nodes form a block, therefore, the owners receive their share of the total reward. This principle is similar to mining pools, which now serve almost the entire Bitcoin network. Due to the initiation and stimulation of network members with smaller amounts, the level of its security is also increased.
The Edinarcoin cryptocurrency is one of the few pioneers which is switching its mining algorithm to the LPoS algorithm. All coin holders are merged into masternodes which is a certain kind of fund in which users donate their coins, thereby allowing the node to mine Edinarcoin and bring profit to all participants of the fund!
In order for a node to become a masternode, you need to collect a certain amount of coins (100 million) on it, which will be captured for a certain period of time to start a mining process to create new coins.
What does this look like? Masternode is a networked computer with an Edinarcoin wallet running on it that captures the number of coins and provides network security when implementing important functions, such as instant confirmation of InstantSend transactions, as well as ensuring network voting.
Thus, the first masternode in the amount of 100 million coins is formed and is accepted for leasing. Coins are captured for different periods of time – starting from 3 up to 12 months, respectively, there will be different fees released depending on the number of coins in leasing and depending on the lease term.
The Edinarcoin Foundation will be the first holder of the masternode, which will initially form the masternode and be able to accept leasing from users, in order to make the entire system operate. Thus, everyone can organize their own fund and become a holder of masternode.
We give an opportunity for each user to place several leased deposits for different terms at once. We make the mining process as easy as possible: if you donate coins, you do not need to keep your personal account open and conduct a daily transaction. You will automatically receive daily accruals on your Edinarcoin wallet and you can freely dispose of these coins. Earning on mining has never been easier!
The masternode mechanism will be launched in January 2019 and this is just the beginning, as the Edinarcoin team have prepared for you many more interesting updates that will increase the liquidity of the cryptocurrency and, respectively, the income of our investors.
Follow our news, keep up to date and make a wise investment with Edinarcoin.